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BAJAJ ELECTRICALS
Key takeaways
The company does not yet see any slowdown in sales of consumer appliances. The sales
growth in the segment is continuing at the same rate as was reported in the first quarter.
The company is not seeing any pricing pressure in the consumer appliances segment on
account of new launches by various companies entering the segment. On the contrary, it
is hopeful of margins increasing in the segment as raw material prices have started
correcting.
In the EPC business, results for 2QFY12E would be subdued as the company would try to
reduce the number of active sites by completing the fringe works (2-3% of the total
project). This would allow the company to improve its project management in the future
as the number of sites would go down which would make the management easier. Also,
it would release the retention money (5-10% of the project cost), which is currently
blocked by the clients as the projects are only 95-97% complete.
The company wants to bid carefully for EPC projects in the future. It would avoid rural
electrification projects where the competition is high. It would bid selectively for projects
of NTPC, NHPC etc. where the payments terms are better and the competition is a little
lower.
The company aims to maintain the current proportion of EPC revenues as a percentage of
the total revenues.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
BAJAJ ELECTRICALS
Key takeaways
The company does not yet see any slowdown in sales of consumer appliances. The sales
growth in the segment is continuing at the same rate as was reported in the first quarter.
The company is not seeing any pricing pressure in the consumer appliances segment on
account of new launches by various companies entering the segment. On the contrary, it
is hopeful of margins increasing in the segment as raw material prices have started
correcting.
In the EPC business, results for 2QFY12E would be subdued as the company would try to
reduce the number of active sites by completing the fringe works (2-3% of the total
project). This would allow the company to improve its project management in the future
as the number of sites would go down which would make the management easier. Also,
it would release the retention money (5-10% of the project cost), which is currently
blocked by the clients as the projects are only 95-97% complete.
The company wants to bid carefully for EPC projects in the future. It would avoid rural
electrification projects where the competition is high. It would bid selectively for projects
of NTPC, NHPC etc. where the payments terms are better and the competition is a little
lower.
The company aims to maintain the current proportion of EPC revenues as a percentage of
the total revenues.
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