Crompton Greaves Consumer Electricals Ltd is Rated Sell

Current Rating and Its Significance

The 'Sell' rating assigned to Crompton Greaves Consumer Electricals Ltd indicates a cautious stance for investors considering this stock. This recommendation suggests that the stock is expected to underperform relative to the broader market or its sector peers in the near to medium term. Investors are advised to evaluate the risks carefully before initiating or maintaining positions in this stock.

Quality Assessment

As of 09 January 2026, Crompton Greaves Consumer Electricals Ltd holds a good quality grade. This reflects a stable operational framework and a reasonable level of business integrity. However, the company’s long-term growth prospects appear subdued, with operating profit growing at an annualised rate of just 3.50% over the past five years. This modest growth rate signals challenges in scaling operations or expanding profitability significantly.

Valuation Perspective

The stock currently carries an attractive valuation grade, suggesting that its market price may be undervalued relative to its intrinsic worth or sector benchmarks. This could present a value opportunity for investors who are willing to accept the associated risks. Despite this, valuation alone does not offset other concerns impacting the overall recommendation.

Financial Trend Analysis

The financial trend for Crompton Greaves Consumer Electricals Ltd is negative as of today. The latest quarterly results for September 2025 reveal a significant decline in profitability, with the PAT (Profit After Tax) falling by 34.5% to ₹86.19 crores compared to the previous four-quarter average. Additionally, the PBDIT (Profit Before Depreciation, Interest and Taxes) for the quarter was at a low ₹158.37 crores. The debtor turnover ratio for the half-year stands at a concerning 1.02 times, indicating potential inefficiencies in receivables management. These factors collectively point to deteriorating financial health and operational challenges.

Technical Outlook

From a technical standpoint, the stock is currently rated as bearish. Price movements over recent months have been weak, with the stock delivering a negative return of 30.70% over the past year. Shorter-term trends also reflect weakness, including a 9.68% decline over the last three months and a 25.17% drop over six months. Although there have been minor positive movements such as a 1.78% gain year-to-date and a 1.92% rise over the past week, these are insufficient to reverse the prevailing downtrend.

Performance Relative to Benchmarks

Comparing Crompton Greaves Consumer Electricals Ltd’s returns to broader market indices highlights its underperformance. The stock has lagged the BSE500 index over the last three years, one year, and three months. This persistent underperformance underscores the challenges faced by the company in delivering shareholder value relative to its peers and the wider market.

Investor Considerations

For investors, the current 'Sell' rating reflects a combination of factors: moderate quality, attractive valuation, negative financial trends, and bearish technical signals. While the valuation may tempt value-oriented investors, the ongoing financial and operational headwinds suggest caution. The stock’s weak recent returns and deteriorating profitability metrics imply that risks remain elevated.

Outlook and Strategic Implications

Looking ahead, Crompton Greaves Consumer Electricals Ltd will need to address its operational inefficiencies and improve profitability to alter its current trajectory. Investors should monitor upcoming quarterly results and management commentary for signs of recovery or strategic initiatives aimed at reversing the negative trends. Until such improvements materialise, the 'Sell' rating advises a conservative approach.

Summary of Key Metrics as of 09 January 2026

The stock’s one-day change is -0.29%, with a one-week gain of 1.92% and a one-month increase of 1.48%. However, the three-month and six-month returns are negative at -9.68% and -25.17% respectively. Year-to-date, the stock has gained 1.78%, but the one-year return remains deeply negative at -30.70%. These figures highlight the volatility and downward pressure on the stock price over recent periods.

The company’s market capitalisation remains in the smallcap category, reflecting its size within the Electronics & Appliances sector. Investors should weigh the risks associated with smaller companies, including liquidity and market sensitivity, against potential valuation opportunities.

Conclusion

Crompton Greaves Consumer Electricals Ltd’s current 'Sell' rating by MarketsMOJO, last updated on 07 August 2025, is supported by a comprehensive analysis of quality, valuation, financial trends, and technical factors as of 09 January 2026. While the stock’s valuation appears attractive, ongoing financial challenges and bearish technical signals warrant caution. Investors should carefully consider these factors in the context of their portfolio strategy and risk tolerance.

Monitoring future earnings releases and operational developments will be crucial for reassessing the stock’s outlook. Until clear signs of recovery emerge, the 'Sell' rating advises a prudent stance.

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