Shares of Crompton Greaves plunged 21.7 per cent to ₹130.6 on Wednesday after the company reported a net loss of ₹107 crore in the December 2015 quarter. While income from operations dropped 14 per cent to ₹2,068 crore, net loss from operations stood at ₹55 crore.
Open interest zooms in F&OIn the derivative segment, Crompton Greaves futures were the highlight of the session, due to the emergence of short sellers. Open interest in February futures rose 41 per cent on Wednesday.
For Crompton Greaves, international business played spoilsport. Power systems business deteriorated in West Asia and the European markets. Net revenue from this segment declined 19 per cent over the corresponding quarter of the previous year. Revenue from the industrial systems segment, however, increased 4.4 per cent to ₹475 crore. While the income from power segment contributed to 77 per cent of the revenue, industrial segment contributed for the balance.
Power system sale lossThe company has recorded a loss on the sale of the power systems segment in Canada to PT Holdings. It has also written off the advances given to CG International BV, a wholly owned subsidiary. This amount was considered irrecoverable based on prevailing business conditions. The combined hit on account of these two accounts totalled ₹410 crore. The international power systems business of the company which saw a quarter-on-quarter decline of 17 per cent is undergoing a challenging phase. This business accounts for roughly 57 per cent share of the overall power segment, based on the outstanding order book. The management is looking for potential buyers to sell the remaining international power business segment too.
Profit on sale of land at Kanjumarg for ₹426 crore helped decrease the overall loss considerably and reduce the overall debt. The company has demerged the profitable consumer products segment last quarter.
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