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• Standalone Revenue: INR1,645 crores in Q2 FY25, growth of 11% YoY.

• ECD Business Revenue: Grew 13% YoY to INR21,393 crores.

• Appliances Growth: 26% YoY in Q2 FY25.

• Pumps Growth: 20% YoY in Q2 FY25.

• Fans Growth: 5% in Q2 FY25.

• Lighting Revenue Growth: 6% YoY in Q2 FY25.

• Solar Pumps Sales: Crossed INR100 crore.

• Large Kitchen Appliances Revenue: INR19 crores.

• Alternate Channels Growth: 37% YoY, contributing 21% of sales.

• Ecommerce Revenue: Over INR200 crore in Q2 FY25.

• Standalone Material Margins: 31.9% in Q2 FY25, up from 30.1% in Q2 FY24.

• EBIT: INR160 crore, growth of 18% YoY, with a margin of 9.7%.

• H1 Revenue: INR3,605 crore, growth of 15% YoY.

• H1 EBIT: INR362 crore, growth of 26% YoY, with a margin of 10.1%.

• Butterfly Revenue: INR258 crore, sequential growth of 42%.

• Butterfly EBIT Margin: 8.9%, expansion of 380 basis points.

• Warning! GuruFocus has detected 3 Warning Signs with BOM:539876.

Release Date: November 14, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Crompton Greaves Consumer Electricals Ltd (BOM:539876) reported double-digit revenue growth for the fifth consecutive quarter, with standalone revenues increasing by 11% in Q2 FY25.

• The company's ECD business saw robust growth, with appliances growing at 26% YoY and pumps at 20% YoY.

• The lighting segment showed improvement, with revenue growth of 6% YoY and margin strengthening, driven by non-conventional lighting products.

• The company has successfully executed pricing actions and maintained strong EBIT margins, with a 60 basis point improvement to 9.7% despite increased A&P spending.

• Crompton Greaves Consumer Electricals Ltd (BOM:539876) has been proactive in regulatory compliance, completing BIS transitions in a timely manner, which positions them well in the market.

Negative Points

• The fans segment, while growing, only saw a 5% increase in revenue, indicating potential challenges in maintaining higher growth rates.

• There is competitive pressure in the market, with some competitors delaying price hikes, which could impact Crompton's pricing strategy.

• The company faces headwinds from weather disturbances and a delayed agricultural season, affecting certain segments like pumps.

• Despite improvements, the lighting segment's growth is still relatively modest at 6% YoY, suggesting room for further enhancement.

• Butterfly Gandhimathi Appliances, a subsidiary, is undergoing a business refresh, which may temporarily impact revenue growth as the company focuses on stabilizing fundamentals.

Q & A Highlights

Q: Can you elaborate on the margin improvement in the fans segment? Is it driven by an increase in the share of premium fans? A: The margin improvement is due to a combination of factors, including price increases, new product development (NPD), and premium offerings. The share of premium fans remains at a similar level, but we have consistently taken price increases, which some competitors have delayed.