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Consumer durable major Bajaj Electricals on Tuesday reported 51 per cent decline in consolidated net profit to ₹48 crore in the quarter ended December 2021, compared to ₹100.5 crore profit during the same period last year. Bajaj Electricals’ revenue from operations during the quarter shrunk by 12 per cent to ₹1,320 crore compared to ₹1,500.14 crore.
Shekhar Bajaj, Chairman and Managing Director, Bajaj Electricals Limited said, “This quarter has continued to witness the impact of increased commodity costs coupled with subdued demand, leading to a deferral of price hikes for our Consumer Product business. While there is a dip in Y-o-Y performance (which had benefited from pent-up demand), the business has delivered a healthy 2-year CAGR on revenues as well as EBIT. Our EPC segment has delivered an EBIT loss despite lower turnover, but continues to focus on project execution and remains cash flow positive. We have continued to generate strong overall positive Cash Flow from Operations amounting to ₹139 crore this quarter.”
Price hike imminent
The consumer goods major which has been bogged down by high commodity prices for the whole fiscal year is likely to hike its prices again. Anuj Poddar, Executive Director, Bajaj Electricals Limited told BusinessLine, “Another price hike of 5 per cent is to be expected, we are watching the market but will take the decision imminently.” According to Poddar, while Q3 saw rising input costs, subdued demand during the quarter meant that Bajaj had to stall its price hike in eptember- December period last year. Bajaj Electricals has already taken a cumulative price hike of nearly 15 per cent between tanuary and September 2021.
Despite of the tough quarter, according Poddar major wins for the company include- surpassed ₹1,000 crore sales mark (2nd highest historical high), an operating margin at 9 per cent (dilution of 3.3 per cent mainly due to rise in input costs and negative operating leverage) as well as an 2-year Operating Profit (EBIT) CAGR in excess of 20 per cent.
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