Crompton Greaves slips post disappointing Q4 results

MUMBAI: Shares of Crompton Greaves were witnessing selling pressure after it reported weak results for quarter ended March last Friday. The company’s consolidated net profit fell 75 per cent to Rs 25.27 crore for the fourth quarter ended March 2013 as compared to a net profit of Rs 100.32 crore in the same period last fiscal.

At 10:00 a.m.; the stock was at Rs 95.05, down 1.35 per cent, on the BSE. It touched a high of Rs 95.80 and a low of Rs 91 in trade today.

Total income for the quarter stood at Rs 3,392.44 crore, as against Rs 3,077.67 crore in the same period last fiscal.

The profitability was impacted by restructuring of power transformers activity in Europe, the company said.

It has declared a final dividend of 20 per cent amounting to Rs 0.40 per share for last fiscal.

ICICI Securities has downgraded the stock to ‘Sell’ due to continued weakness in the overseas power segment margins as the situation post restructuring has not improved. The brokerage is of the view that no guidance on FY14E margin further raises concern on outlook.

It expects muted domestic power segment topline as well as margins given weak order wins and higher proportion of project-related orders and sluggishness in consumer segment margins.

“We believe that the low-margin environment will linger in the near term, as the issues are more structural in nature," ICICI Securities said.