Crompton Greaves Consumer Electricals Limited Q3 FY26 Earnings Call Summary

Summary

Crompton Greaves Consumer Electricals Limited - Q3 FY26 Earnings Call Summary Friday, February 06, 2026 5:00 PM IST

Event Participants

Executives 6 Kaleeswaran Arunachalam (CFO), Natasha Kedia (Head IR), Promeet Ghosh (MD & CEO), Rajat Chopra (BU Head - Home Electricals), Shaleen Nayak (BU Head - Lighting, Solar & Wires), Swetha Sagar (CBO - Butterfly Gandhimathi)

Analysts 8 Aditya Bhartia, Aditya Vikram, Aniruddha Joshi, Keshav Lahoti, Manjeet Buaria, Manoj Gori, Parag Khare, Praveen Sahay, Rachna Kukreja, Renu, Siddhartha Bera, Umang Mehta

Financials & KPIs

*Estimated based on segment growth commentary.

Geographic & Segment Commentary

• Electric Consumer Durables (ECD): Performance was anchored by a doubling of solar pump revenues YoY and reaching the #2 market share position in Water Heaters within General Trade (GT). The segment managed the BEE 2.0 fan transition effective Jan 1, 2026, by liquidating legacy inventory and scaling BLDC fan sales by over 50% QoQ.
• Lighting: Maintained industry-leading margins through a shift in product mix toward ceiling lights and accessories. The segment benefited from supply chain efficiencies and the launch of new premium products to offset commodity pressures.
• Butterfly Gandhimathi: Net profit grew 44% YoY, driven by the “Idea First” premium series and improved terms of trade in the go-to-market strategy. Gas stoves and pressure cookers both registered double-digit growth.

Company-Specific & Strategic Commentary

• Residential Wires Launch: Entered the ₹36,000-37,000 crore residential wires market using an outsourced manufacturing model to leverage brand equity and pan-India distribution. Products will be available in select markets within 6-7 weeks.
• BEE 2.0 Fan Transition: Successfully transitioned to new star ratings on Jan 1, 2026, as the world’s largest ceiling fan brand. The “XTECH” program enabled cost-effective engineering changes to meet new standards.
• Solar Expansion: Currently executing a ₹500 crore solar rooftop order book, primarily B2B state tenders (e.g., 38,000 homes in Andhra Pradesh). Management noted material gross margin improvements in solar as scale increases.
• Premiumization: Focused on the “Idea First” series in Butterfly and high-margin “Agri & Specialty” pumps to drive ASP and margin expansion.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

New Business Segments

• Question: What is the procurement and Capex strategy for the new wires business? (Aditya Bhartia)
• Answer: Currently using an outsourced model with no significant Capex planned for the next year. The focus is on leveraging the brand and distribution to gain leadership share (Promeet Ghosh).
• Question: Is the solar rooftop order book B2C or B2B? (Praveen Sahay)
• Answer: It is B2B/B2G in terms of the contract (government intermediated), but the product is identical to B2C rooftop solutions. Execution has already begun with ₹18-19 Cr booked this quarter (Promeet Ghosh).

Margins & Pricing

• Question: How much price hike is needed to offset BEE 2.0 and RM costs? (Keshav Lahoti)
• Answer: A 1-1.5% hike was taken in January. Two more hikes are planned for Q4 and Q1. This, combined with “UNNATI” cost savings, should offset the impact (Kaleeswaran A).
• Question: Why enter low-margin categories like wires? (Manjeet Buaria)
• Answer: Crompton enters categories to lead. Solar pumps are already highly profitable and growing 100%+. We categorize entries into “play-to-win” vs “play-to-participate” (Promeet Ghosh/Kaleeswaran A).

Product Performance

• Question: How is the water heater business performing in General Trade? (Umang Mehta)
• Answer: We have moved from a lower rank to become the #2 player in GT nationally, complementing our #1 position in E-commerce (Promeet Ghosh).

Key Takeaway

Crompton reported a resilient Q3 FY26 with consolidated revenue growing 7% YoY to ₹1,898 crores, marked by a strong 18.5% sequential EBITDA recovery. The company successfully navigated the BEE 2.0 fan transition and solidified its #2 position in the water heater GT segment. Strategically, the launch of residential wires and the execution of a ₹500 crore solar order book signal a significant expansion of the company’s Total Addressable Market toward ₹2.0 lakh crores. While commodity inflation persists, management is aggressively deploying its “UNNATI” cost-saving program and implementing staggered price hikes through Q1 FY27 to protect margins. The company remains focused on transitioning from a traditional appliances player to an end-to-end home solutions provider, with a clear trajectory of premiumization across its core and new categories.