Multibagger Alert: This FMEG manufacturer has given returns of 110.93% in the past year!

The management's focus on transforming the company into a dominant FMEG player has changed the business dynamics for the company.

Bajaj Electricals (BEL), one of the leaders in electrical and home appliances, has given investors stellar returns of 110.93% over the last year. The share price of the company stood at Rs 610.45 on January 01, 2021, and since then, it has more than doubled investor wealth.

Headquartered in Mumbai, Bajaj Electricals engages in the manufacture and sale of electrical and industrial products. It operates through the segments of Consumer Products, Engineering & Projects (EPC), and Others. The Consumer Products segment offers appliances, fans, and consumer lighting products. The EPC segment includes transmission line towers, telecommunications towers, high mast, poles, and special projects including rural electrification projects and luminaires. The Others segment deals with wind energy. The company derives 72% of its revenues from consumer-facing businesses and 28% from industry and infrastructure-related businesses.

Despite facing several challenges such as high commodity prices, supply chain issues, Bajaj Electricals came out with a decent top-line growth led by the consumer product segment. The company reported revenue growth of 6.09% YoY to Rs 1283.44 crore led by 29.8% YoY growth in a consumer product. However, the EPC business declined by 37.3% YoY. The PBIDT (excluding other income) for the quarter declined 9.95% YoY to Rs 94.37 crore while margin contracted by 136 bps YoY affected by high commodity prices, supply chain issues. PAT for the quarter grew by 17.77% YoY to Rs 62.55 crore, on account of a 134.89% increase in other income.

In the past few years, Bajaj Electricals has been focussing on driving a more consumer-centric business where it holds a strong brand presence with adequate investment in its portfolio and quality of reach. The management commits to delivering double-digit growth in consumer products, led by sustained market share gains and new product launches.

In consumer products, the company has delivered sales CAGR of 10% from FY19 to FY21, the highest among established large brands with sustained gain in market share across segments which has led to wealth creation for its shareholders. Looking ahead, the company’s innovation and ability to realign its product portfolio with the changing trends of consumer behaviour are likely to help it penetrate deeper into the market.

At 1 pm on Tuesday, the stock of Bajaj Electricals Limited was trading at Rs 1277, down by 0.83% or Rs 10.65 per share on BSE. The 52-week high of the scrip is recorded at Rs 1,588.55 and the 52-week low at Rs 602.05 on the BSE.