India's Orient Electric posts smaller Q1 profit as high costs outweigh sales jump

Orient Electric

01/08/2024 11:06

BENGALURU, Aug 1 (Reuters) - India's Orient Electric  ONTE.NS  reported a 27% fall in first-quarter profit on
Thursday, as higher expenses outweighed the rise in sales of fans and coolers as the country battled with scorching heat.
    Orient Electric, which also sells  mixer-grinders and switchgears, said profit decreased to 143.4 million rupees
($1.7 million) in the quarter, from 196.9 million rupees a year earlier.
    Revenue from operations grew by 7% to 7.55 billion rupees.
    
    KEY CONTEXT
    Rising temperatures and intense heatwaves across the country has boosted demand for cooling products, but it was
offset by higher costs of traded goods, hitting the company's bottomline. 
    Indian home appliance makers have delivered a largely mixed set of earnings, setting up a balancing act between
bolstered demand and higher costs of raw materials like copper and aluminium.  
    Last month, Crompton Greaves  CROP.NS  beat quarterly profit estimates, helped by rising demand for fans and coolers,
although Havells India  HVEL.NS  missed estimates as expenses surged.

    PEER COMPARISON    
    
                                     Valuation(next 12     Estimates (next 12        Analysts' sentiment            
                                         months)                months)                                         
                          RIC           PE        EV/EBI   Revenue     Profit    Mean     # of      Stock to    Div yield
                                                   TDA    growth (%)   growth   rating*  analyst     price         (%)
                                                                        (%)                 s       target**    
   Orient Electric      ONTE.NS        47.17      24.20     13.97      45.08      Buy      15         1.13        0.52
    Havells India       HVEL.NS        65.33      44.37     20.25      26.78      Buy      21         0.98        0.49
   Crompton Greaves     CROP.NS        45.44      29.91     12.21      30.78      Buy      31         0.99        0.66
 Consumer Electricals                                                                                           
    Polycab India       POLC.NS        47.99      33.02     17.99      19.27      Buy      24         0.99        0.44
 
    
 * Mean of analysts' ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
 * Ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the
PT
    
    APRIL-JUNE STOCK PERFORMANCE
    
 -- All data from LSEG
 -- $1 = 83.7150 rupees

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Orient Electric Q1    https://tmsnrt.rs/3WOhJhH
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 (Reporting by Dimpal Gulwani and Ashna Teresa Britto in Bengaluru; Editing by Savio D'Souza)
 ((Dimpal.Gulwani@thomsonreuters.com;))