Crompton Consumer came under focus after both Morgan Stanley and CLSA issued their latest views on the company’s Q2FY26 performance. Morgan Stanley maintained its equal-weight call with a target price of ₹310 per share, while CLSA retained its outperform call with a slightly reduced target of ₹305 per share, implying around 10% upside from the current market price of ₹277.55.
Morgan Stanley noted that adjusted PAT missed estimates, dragged down by 3% lower revenue, weak margins in the electrical consumer durables (ECD) segment, and lower other income. ECD revenue declined 2%, led by softness in fans and large appliances, while ECD margin contracted 425 basis points year-on-year due to negative operating leverage and higher advertising spends. On a positive note, lighting revenue rose 3%, with margin improving 485 basis points year-on-year on a favourable product mix.
CLSA also said that Q2FY26 results were below expectations due to margin weakness. The brokerage attributed the softness in TPW fans and large appliances to high commodity prices and seasonality. However, it highlighted that the lighting segment rebounded strongly with improved margins. CLSA added that the company expects its solar business to become its second-largest revenue contributor within 18–24 months, supported by strong return on capital employed (RoCE).
At the time of the reports, Crompton Consumer shares were trading at ₹277.55.
Disclaimer: The views and target prices mentioned are those of the brokerages (Morgan Stanley and CLSA). This article is based solely on the provided inputs and is intended for informational purposes only. No investment advice.
