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Bajaj Electricals Q1FY22 Conference Call Highlights

Bajaj Electricals Q1FY22 Conference Call Highlights

Published on 16 August 2021 Views 4 Comments 0
  • Consumer products bottom line has been affected due to
  • Some part of the incremental cost of EPC business has been added to it.
  • Incremental advertisement spending- Rs 29 Cr (4.7% of consumer sales is spent on ads.)
  • Logistics outsourcing to Mahindra logistics is still going on. It will be completed by the next quarter. Hence, the inefficiencies have multiplied and the COVID impact.
  • Employee incentives have gone up in this quarter.
  • Starlite merger has been fully completed and the synergies are looked into to gain cost efficiencies.
  • Net Debt at 434 Cr. The company plans to have a zero debt position in terms of its standalone business at the end of FY-22.
  • Consumer Products EBIT Margins will hover around 9% for this year. In the next year, the company is planning to have 10% EBIT margins.
  • Gross margins were affected due to raw material price rise. Some of the impacts were passed away to consumers albeit later.
  • Research and Development costs will be around 2% for this year. Going forward the company will reduce it towards 1 to 1.5%.
  • EPC business is still in the red. The company is expecting a turnaround in the business till Q4. In the EPC, Illumination has seen a turnaround but the Transmission and Distribution segment is still making losses.
  • Margins and Profitability will get normalized in the coming quarters.
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