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Bajaj Electricals returns to profit in Q1, expands ESOP pool and strengthens leadership
Consumer products drive turnaround as company names new growth chief and boosts employee incentives
Mumbai: Bajaj Electricals Limited switched on a strong start to FY27, returning to profit in the first quarter as growth in its consumer products business and tighter cost management helped the company recover from a weak previous quarter.
The company reported a standalone net profit of Rs 47.9 crore for the quarter ended June 30, compared with Rs 1.6 crore in the corresponding period last year. It also rebounded from a loss of Rs 64.3 crore in the March quarter.
Revenue from operations increased to Rs 1,089.4 crore, up from Rs 1,064.6 crore a year earlier, while total income rose to Rs 1,115 crore, supported by Rs 25.6 crore in other income.
On a consolidated basis, profit attributable to owners of the company stood at Rs 48.4 crore, while consolidated profit before tax reached Rs 65.7 crore, including contributions from associates and joint ventures.
Basic earnings per share increased sharply to Rs 4.16 on a standalone basis and Rs 4.19 on a consolidated basis, compared with Rs 0.14 and Rs 0.08, respectively, in the year-ago quarter.
The company’s total standalone expenses declined to Rs 1,058.5 crore from Rs 1,086 crore a year ago despite higher raw material and traded goods purchases. Lower inventory costs, reduced depreciation, lower finance costs and tighter control over other operating expenses helped improve profitability.
Profit before tax, excluding exceptional items, stood at Rs 56.5 crore. The bottom line was further supported by an exceptional gain of Rs 8.8 crore arising from the sale of immovable property. This compares with significant exceptional charges booked during the previous financial year related to labour code provisions, impairment of goodwill, moulds and dies, and employee-related expenses.
The consumer products division remained the key growth engine during the quarter. Revenue from the segment, which includes appliances, fans and Morphy Richards products, increased to Rs 820.4 crore from Rs 807 crore a year earlier. More importantly, the segment returned to profit with Rs 32.4 crore, compared with a loss of Rs 13.6 crore in the corresponding quarter last year.
The lighting solutions business also delivered steady growth, with revenue rising to Rs 269 crore from Rs 257.6 crore. Segment profit stood at Rs 17.9 crore, lower than Rs 27.2 crore reported a year ago.
Alongside its financial results, Bajaj Electricals announced key leadership changes. The board appointed Krishnan Sundaram as chief growth and new business officer, effective August 11, and designated him as senior management personnel.
The company also approved a significant expansion of its Performance Stock Option Plan 2023, subject to shareholder approval. The ESOP pool will increase from 575,510 options to 3,002,559 options, with the addition of 2,427,049 stock options, substantially widening employee participation in the company’s long-term growth.
In addition, the board recommended changes to the remuneration structure of whole-time directors, including Bajaj Electricals Limited, executive chairman, Shekhar Bajaj, to align with the country’s updated labour codes. The proposals will be placed before shareholders through a postal ballot.
The quarterly results received an unqualified limited review from SRBC & Co LLP.
With a return to profitability, improving operational performance and fresh investments in leadership and employee ownership, Bajaj Electricals has entered FY27 with renewed momentum as it looks to strengthen growth across its consumer and lighting businesses.
