The company took a hit of Rs 89.4 crore due to an exceptional item
Bajaj Electricals posted an 81 percent drop in its March quarter standalone net profit at Rs 7.3 crore YoY missing estimates because of a one-time hit of Rs 89.4 crore from loans given to its joint venture with Starlite Lighting.
The company had posted net profit of Rs 38.42 crore in the fourth quarter of FY17. A Reuters poll of equity analysts had estimated net profit to rise by 50 percent to Rs 57.6 crore in the fourth quarter.
In its results statement, the company said that it has re-assessed the recoverability of its investments and loans provided to Starlite Lighting Limited. Consequently, it has impaired it fully in both standalone as well as consolidated financial results and disclosed as an exceptional item.
This decision has been taken by Bajaj Electricals after the reduction in the compact fluorescent lamp (CFL) business and future outlook, according to their statement.
The total income saw a 26.3 percent jump YoY to Rs 1,628.82 crore in Q4. In terms of the segment revenue, consumer products saw a 5.5 percent increase in revenue YoY to Rs 644.64 crore. Engineering, Procurement and Construction (EPC) segment saw a jump of 44.1 percent YoY in revenue to Rs 961.48 crore in Q4.
The company announced that Anant Bajaj has been elevated as the Managing Director of Bajaj Electricals.
The board has recommended a final dividend of Rs 3.50 per share, subject to approval of shareholders.
Shekhar Bajaj, Chairman and Managing Director, Bajaj Electricals said that the benefit of Range and Reach Expansion Programme (RREP) is evident from the topline and bottomline growth in consumer products segment, which is driven by strong demand for LED and few other products.
"The RREP rollout in J&K, Himachal Pradesh and North-East states is in progress and is expected to be completed by end September 2018," he added.
RREP refers to a programme wherein the sales staff is evaluated on the number of outlets and the number of stock unit covered.
An Edelweiss Securities report had said that the company’s consumer durables segment is expected to grow 5 percent as they launch new products to gain back its lost market share.
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