Crompton Greaves Consumer Electricals Ltd. - BUY
CMP Target Upside Tenure
Rs 216 Rs 262 21.3% 1 Year
Crompton operates in four distinct product categories - fans, lighting, pumps and appliances. Fans & lighting contribute ~42% & ~31% of its turnover respectively. Pumps and small appliances account for ~20% and ~10% respectively of its revenue.The company has a leading market shares across the product categories it operates in. We expect the company to register revenue & PAT CAGR of ~19% & ~28% over FY17-19E, helping it to generate strong free cash flows of Rs1,146 cr over FY17-19E. Crompton’s asset light approach, margin expansion & improving market share across products will lead to industry leading RoCE (44-48% over FY17-19E). Given these positives we value the stock at 35x on FY19E earnings. We have a BUY rating on the stock to arrive at the 12 months target price of Rs 262.
IIFL Research
Crompton Greaves Consumer Electricals Ltd - BUY
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Re: Crompton Greaves Consumer Electricals Ltd - BUY
HI. I WOULD LIKE TO INVEST IN CG CONSUMER ELEC FOR LONG TERM PERIOD. ABOUT 2-3 YEARS. WHAT ARE YOUR VIEWS? WHAT TARGET WOULD YOU SUGGEST?
OR DO YOU THINK ITS BETTER TO BOOK BY END OF 2017?
THANKS
OR DO YOU THINK ITS BETTER TO BOOK BY END OF 2017?
THANKS