India's Bajaj Electricals posts Q3 profit drop on shrinking consumer spends

Bajaj Electricals

05/02/2024 09:34

BENGALURU, Feb 5 (Reuters) - India's Bajaj Electricals
 BJEL.NS  reported its third consecutive drop in quarterly
profit on Monday, as high inflation dampened festive spending
and rural demand remained subdued.
    Consolidated net profit slumped nearly 40% to 373.6 million
rupees ($4.5 million) for the three months ended Dec. 31,
following declines of 56% and 14% in the previous two quarters.
    The October-December period typically marks the festival
season in India, during which consumers traditionally splurge on
non-discretionary products. However, demand was subdued in the
latest quarter due to elevated inflation levels, which
restrained expenditure on non-essential items, in both rural and
urban areas, analysts said.
    While the likes of Voltas  VOLT.NS  and Blue Star  BLUS.NS 
benefited from demand for air coolers and fans due to
warmer-than-usual temperature in the quarter, companies such as
Havells  HVEL.NS  were hit by slowing sales of other home
appliances.
    "Consumer products continue to show signs of rural stress
and weak consumer demand," Bajaj Electricals said in a
statement. 
    Bajaj Electricals' total revenue fell 6.2% to 12.28 billion
rupees, marking the third consecutive quarter of decline.
    Sales of consumer products, which accounted for nearly 80%
of revenue, dropped 8%, while sales of lighting products barely
increased about 1%.
    The Mumbai-based company's input costs increased 4.8% to
1.24 billion rupees.  
    


($1 = 83.0386 Indian rupees)

 (Reporting by Manvi Pant in Bengaluru; Editing by Dhanya Ann
Thoppil)
 ((Manvi.Pant@thomsonreuters.com; +918447554364;))