Bajaj Electricals surges 18%, hits new high on robust Q3 results

The company's consumer product business has delivered a strong growth in this quarter despite continuing supply challenges and increase in commodity prices

Shares of Bajaj Electricals hit a new high of Rs 907, surging 18 per cent in intra-day deals on the BSE on Friday after the company reported robust consolidated net profit of Rs 98 crore in December quarter (Q3FY21), on strong performance by consumer products (CP) business. The household appliances maker had profit of Rs 9 crore in a year ago quarter.

For Q3FY21, the company has achieved sales of Rs 1,500 crore as against Rs 1,284 crore, an increase of 16.8 per cent over the third quarter of the previous year. The earnings before interest and tax  (EBIT) for the CP segment stood at Rs 142 crore, showing a 115 percent rise over the year-ago period, the company said.

The management said the CP business has delivered a strong growth in this quarter despite continuing supply challenges and increase in commodity prices and has delivered its highest ever quarterly EBIT. The engineering, procurement and construction (EPC) segment has reduced its loss, while continuing to focus on execution and working capital, it said.

As on January 1, 2021, the order book position of the company stood at Rs 1,220 crore, comprising of Rs 388 crore, for transmission line towers, Rs 501 crore for power distribution, and Rs 331 crore for illumination projects, the company said.

Bajaj Electricals has a leading position in the consumer products business, supported by strong brand image, product development capabilities and a wide distribution network. ICRA has a stable outlook on expectation that the company would be able to sustain a healthy revenue growth in the consumer products segment in the near term with profitability level in line with the company’s expectation. The stable outlook also reflects the company’s stated strategy to selectively focus on the EPC segment to ensure the budgeted profitability, it said in recent rating rationale.

At 11:26 am, the stock was trading 13 per cent higher at Rs 871 on the BSE, as compared to 0.54 per cent rise in the S&P BSE Sensex. The trading volumes on the counter more-than-doubled with a combined 2.7 million equity shares changing hands on the NSE and BSE.