Crompton Greaves Consumer Electricals reports 43% drop in net profit for September quarter, revenue edges up

Crompton Greaves Consumer Electricals Ltd. reported a substantial 43% year-on-year decrease in net profit for the September 2025 quarter, with profit falling to ₹71 crore from ₹124.9 crore in the same period last year. Revenue from operations saw a modest 1% rise, reaching ₹1,915 crore, supported by a 3% underlying volume growth that was partially affected by pricing adjustments. The decline in profitability was attributed to commodity inflation, pricing pressures, increased advertising and promotional investments, and higher operating expenses related to transformation initiatives. Earnings before interest, tax, depreciation, and amortisation (EBITDA) fell by 22.6% to ₹158 crore, and the EBITDA margin contracted to 8.2% from 10.7%. The company also recorded a restructuring cost of ₹20.36 crore at its Baroda facility.

Segment performance showed mixed results. Butterfly Gandhimathi Appliances reported strong revenue growth of 14%, while the Electrical Consumer Durables (ECD) segment experienced a 1.5% decline in revenue. Pumps and Small Domestic Appliances (SDA) performed well, driven by solar pump demand and new launches respectively. The lighting segment showed stable performance with a 3.1% revenue increase. Notably, Crompton Greaves made a strong entry into the solar rooftop segment, securing orders worth approximately ₹500 crore.

Impact: The financial results highlight the pressures of inflation and operating costs on profitability. However, the significant solar rooftop orders represent a new, promising growth avenue for the company. Investors will monitor the company's ability to improve margins and execute these large orders effectively. Impact Rating: 6/10

Difficult Terms:

Net Profit: The profit remaining after all expenses, including taxes, have been deducted from total revenue. Revenue from Operations: The total income generated from the company's primary business activities before deducting expenses. EBITDA: Earnings Before Interest, Tax, Depreciation, and Amortisation. It is a measure of a company's operating performance. Commodity Inflation: An increase in the prices of raw materials such as metals, plastics, and energy. EBITDA Margin: EBITDA expressed as a percentage of revenue, indicating the company's operational efficiency. Restructuring Cost: Expenses incurred by a company when it reorganizes its operations or facilities. Electrical Consumer Durables (ECD): Household electrical products like fans, air conditioners, and refrigerators. Small Domestic Appliances (SDA): Smaller electrical appliances used in homes, such as mixers, toasters, and irons. Solar Rooftop Segment: The business of installing solar panels on residential or commercial rooftops to generate electricity.