ICICI Securities: Crompton Greaves - Externalities Challenging, Execution On Track
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ICICI Securities Report
Covid-19 impact led to approximately 47% drop in Crompton Greaves Consumer Electricals Ltd.’s Q1 FY21 revenue, while margin remained resilient through lower advertisement expenses and cost savings.
From March 23, 2020 till April-end, operations were severely impacted. All factories, depots, distributors, wholesalers and retailers were closed due to the lockdown.
Business picked up in May and improved in June. Ebitda margin was almost flat at 14.1% in Q1 FY21 driven by 12% reduction in employee costs, no advertisements and sales promotion (3.3% of sales in Q1 FY20) and 51% lower other expenses (due to lower activity and cost control programs).
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