Motilal Oswal sees 35% upside in Crompton Consumer, reiterates Buy

Motilal Oswal has maintained its Buy rating on Crompton Greaves Consumer Electricals with a ₹340 target price versus a ₹252 market price. The brokerage forecasts FY26–28 revenue, EBITDA and PAT CAGRs of about 13%, 18% and 21%, respectively, aided by premiumisation and margin gains.

— Source published Fri, 21 Aug, 2026, 09:43 IST · First seen Fri, 21 Aug, 2026, 10:47 IST · Source NDTV Profit

What happened

Motilal Oswal reiterated Buy on Crompton Greaves Consumer Electricals with a Rs 340 target, implying 35% upside. It expects revenue, EBITDA and PAT growth

Key facts

  • Buy rating
  • Target price: Rs 340
  • Current market price: Rs 252
  • Potential upside: 35%
  • FY26-28 revenue CAGR: ~13%
  • FY26-28 EBITDA CAGR: ~18%
  • FY26-28 PAT CAGR: ~21%
  • Operating profit margin: ~11% by FY28 versus ~10% in FY26
  • Valuation: 27x FY27E EPS and 22x FY28E EPS
  • Net cash: Rs 180 crore in FY26
  • Annual free cash flow: Rs 650 crore+ over FY24-26

Why this matters

The outlook reinforces the strategic value of premium product expansion and margin-accretive portfolio moves in consumer durables, where Crompton is expected to outgrow earnings through FY28.

What to watch

  • Fan and pump demand acceleration during the peak summer season.
  • Sequential improvement in premium-product mix and realization growth.
  • EBITDA margin expansion exceeding expectations despite promotional activity.
  • Commodity-price movements in copper, aluminium, steel and plastics.
  • Rural consumption recovery, monsoon quality and farm-income trends.
  • Any deterioration in channel inventory, receivable days or dealer-led discounting.
  • Quarterly earnings upgrades or downgrades relative to the 13% revenue and 18% EBITDA CAGR assumptions.
  • Track quarterly volume growth in fans, pumps and small appliances versus category demand.
  • Monitor gross-margin and EBITDA-margin progression for evidence of premium mix and cost savings.
  • Watch management commentary on channel inventory, dealer incentives and competitive pricing.
  • Compare summer-season demand trends with weather conditions, rural income indicators and housing-sector activity.
  • Assess whether analyst earnings revisions begin to validate the projected FY26-28 PAT CAGR of about 21%.