Hold Crompton Greaves Consumer; target of Rs 415: ICICI Direct

ICICI Direct's research report on Crompton Greaves Consumer

Crompton Greaves Consumer (CGCEL) is among India’s leading fast moving electrical goods (FMEG) companies, present in electrical consumer durables (~63% of revenue) and lighting businesses (~16% of revenue). CGCEL acquired Butterfly Gandhimathi Appliances, which contributes ~21% to revenue. Market leader in the domestic fan industry with value market share of 29%. The company has enhanced focus on increasing market share in home appliances categories like (air coolers, water heater and kitchen appliances) • Robust balance sheet with RoE & RoCE of ~30% each (three-year average), respectively, with stringent working capital policy.

Outlook

We maintain our HOLD rating on the stock. We value CGCEL at Rs 415 i.e. 37x P/EFY24E EPS.