Bajaj Electricals Q1 - Green Shoots In Rural Demand, Consumer Products Coming Out Of Woods: Yes Securities

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Yes Securities Report.Bajaj Electricals Ltd.'s consumer products business registered muted revenue growth of 3.7% on soft demand for kitchen appliances. Summer products (fans, air coolers) and Morphy Richards premium small domestic appliances demonstrated better growth. Margins were subdued on back of operating de-leverage and higher brand investments. The company has been aggressively launching new products large part of it at the premium end. On the lighting front growth in professional lighting was marginally offset by drop in consumer lighting. Company believes worst is behind them for the consumer products and there has been sequential improvement. Bajaj Electricals has taken corrective actions which includes price hikes, cutting of excessive discounts and focus remains to protect the margins. We maintain our revenue estimates as kitchen which has been key category is seeing signs of improvement. Management is witnessing green shoots in rural demand which has been pain point of the company. We upgrade the stock to Add with target price of Rs 1,062 as-Management believes worst for the consumer products is behind;Bajaj Electricals will protect margins by taking appropriate actions and Green shoots visible in the rural market which is key for the company. .We now value the stock at 40 times as rural is expected to do well in the coming time given the steps taken by government is aimed at improving rural consumption..Click on the attachment to read the full report:.Bajaj Electricals Q1 Results: Profit Falls 24%.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Bajaj Electricals Q1 - Green Shoots In Rural Demand, Consumer Products Coming Out Of Woods: Yes Securities

The brokerage expects the stock to rerate once there is sustainable improvement in profitability and pick-up in rural demand.

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