Buy Crompton Greaves Consumer Electrical; target of Rs 280: Edelweiss

Edelweiss' research report on Crompton Greaves Consumer Electrical

Crompton Greaves Consumer (Crompton), riding a healthy double digit growth in key segments in Q4FY18, regained some investor confidence which had been shaken by a tepid Q3FY18. The market share gain in fans aided by double digits value growth versus flat industry is commendable. Management reiterated its growth strategy targeting retail expansion and product innovation while retaining cost rationalisation focus.

Outlook

Which we believe, will drive 19% earnings CAGR yielding 17% free cash CAGR over FY17-20E. Maintain ‘BUY’ with revised TP of INR280 (INR290 earlier) building in the impact of slower growth in pumps and water heaters segment.