Crompton
Greaves Consumer Electricals Ltd (539876)
is Trading at ₹399.45 with
a Loss of -0.9% on
26-May-2021 with formation of a Red Candle on Daily Price
Chart at the time of writing this article.
About the Company : Crompton Greaves Consumer Electricals Limited is one of the leading
consumer companies in India with a 75+ years old brand legacy. It is an
independent company under professional management and have 2 business segments
– Lighting and Electrical Consumer Durables. We market our products under the
“Crompton” brand name in India and select export markets
Sector Update : Stable
Strength : 1. The company gained a 1
per cent share in fans from smaller players in FY21 with its current share at
28 per cent
2.. All the main consumer product categories
such as fans, appliances and pumps which make up 78 per cent of revenues
reported robust growth ranging from 59-74 per cent. Growth in the lighting
segment was led by consumer lighting which grew by 41 per cent.
3. It has also outperformed the sector growth
across segments such as pumps, mixer grinders and air coolers.
Financials : Crompton Greaves Consumer
Electricals Ltd has posted Net Sales /
Revenue of ₹4803.50 Cr &
Net Profit of ₹141.10 Cr in
FY2020 and expected to post Net Sales / Revenue of ₹1358.60 Cr &
Net Profit of ₹616.70 Cr in
FY2021 and expected to post Net Sales / Revenue of ₹5429.40 Cr &
Net Profit of ₹573.90 Cr in
FY2022 & Net Sales / Revenue of ₹6521.50 Cr & Net Profit of ₹744.10 Cr in
FY2023.
Valuations : The Company is now
Trading at X 32.50 of its valuations
( FY2021 earnings considered here) with ~150 % premium and at X2.66 of its FY 2022, which is
almost ~166% premium to its value and X 2.05 of its FY 2023 earning with a Premium of ~105% of its FY2023 earning .
Margin of Safety (1Yr Bond Yield: Value>1
) is now 0.60 which
makes is attractive after a ~40% fall in market price. The Equity Value Per Share ( Enterprise Value Method
) is ₹393.50
Whats
best in It : Strong growth, higher cash flows due
to efficient working capital management and improving balance sheet are
positives will help it to capitalise on
pent up demand once normalcy returns.
If We factor its earnings/valuations, its Price arrives
at ₹491.00 with
consideration FY2023 earnings.
Disclaimer : We are / may going to take exposure shortly.
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Data
Source | NSE Website | Screener.In | Capital Line | Money Control |
The
author tracks economic, behavioural and corporate tends, hoping to gauge good
avenues of return based on Fundamental Valuations of Stocks, a follower of EPV
method. You can reach me/us at |
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