Transformer manufacturer Crompton Greaves will declare its second quarter (July-September) results today. According to a CNBC-TV18 poll, analysts expect sluggish growth during the quarter due to subdued power sector and restructuring in international business.
Standalone consumer business (domestic) will drive the revenues while some improvement in international operations will help margin growth, feel analysts.
However, the company could report a negative margin surprise for overseas subsidiaries. Upside to margin will also be capped due to the impact of rupee depreciation on imported raw materials.
Losses in international business are expected to continue, led by losses on projects shifted from Belgium to Hungary and scale up of Hungarian operations.
Analysts expect consolidated profit after tax to grow 78.4 percent year-on-year to Rs 75 crore and net sales may rise 11.8 percent Y-o-Y to Rs 3,268 crore in the quarter gone by.
Earnings before interest, tax, depreciation and amortisation is likely to increase 26.8 percent on yearly basis to Rs 173 crore and operating profit margin may expand 60 basis points Y-o-Y to 5.3 percent in three-month period ended September 2013.
Meanwhile, Crompton announced a buyback of shares upto worth Rs 270 crore within a year from July 2013. Since then, the company has bought back 1.18 million shares (1.8 percent of total equity) at an average price of Rs 83 apiece.
Analysts say while the buyback has provided some near-term support, concerns remain on margin pressure.
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