(Reuters) -India’s kitchenware maker TTK Prestige reported a nearly 22% rise in its second-quarter profit on Tuesday, driven by mass-priced launches in smaller towns and margin-boosting premium offerings in metropolitan markets.
The company’s consolidated net profit rose to 642.4 million rupees ($7.3 million) in the quarter ended September 30, from 528.7 million rupees a year ago, per a regulatory filing.
Its revenue from operations grew 11% to 8.34 billion rupees, compared with a growth of 3% last year.
Shares of the company jumped 10% post results.
KEY CONTEXT
The consumer-focussed company has been witnessing pressure on its profits in recent quarters due to weak urban demand and declining rural sales, as microfinance institutions scaled back lending amid stress in their loan portfolios.
To revive sales, TTK Prestige has been foraying into smaller towns with more affordable offerings while simultaneously refining its premium catalogue to attract affluent customers in larger cities.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBI Price/ Revenue Profit Mean No. of Stock to Div
TDA Sales growth (%) growth (%) rating* analyst price yield
s target** (%)
TTK Prestige 43.86 28.42 NULL 8.14 11.17 Hold 3 0.99 0.93
Voltas 49.35 38.97 2.60 10.64 21.13 Hold 35 1.04 0.49
Havells India 51.04 34.37 3.77 11.71 18.15 Buy 25 0.89 0.67
Crompton Greaves 27.54 18.02 2.12 9.09 14.32 Buy 30 0.71 1.03
Consumer
Electricals
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
JULY TO SEPTEMBER STOCK PERFORMANCE
— All data from LSEG
($1 = 87.8950 Indian rupees)
(Reporting by Ananta Agarwal in Bengaluru; Editing by Sumana Nandy)
