Margins recover, but revenue growth collapses vs prior 8–10% guidance

Q2 FY27 revenue ₹1,123.3 Cr vs ₹1,107.0 Cr Q2 FY26 = +1.5% YoY

31.9% vs 31.4% = +70 bps confirmed

EBIT margin now 4.4% vs 3% prior year = +140 bps confirmed

PAT reported ₹26.1 Cr but PBT trajectory confirmed

Management claimed consistent 4% EBIT margin Q2, adjusted 5.9% ex-brand spend

Q2 FY27 delivered 1.5% revenue growth = 15–19% of guidance target

Lighting EBIT margin 3.1%, down 1.3% YoY = missed prior guidance

Prior: 8–10% quarterly growth. Q2 FY27: 1.5%. No formal retraction but clearly missed and now conditional FY28 guidance issued

Prior: 6–7% sustained for 2 years. Current: 4%, 5.9% adjusted. Below guidance floor

Prior: double-digit margins targeted. Delivered: 3.1% EBIT, down 1.3% YoY

Shekhar Bajaj stepping down from CEO role as of 1 Jan 2027; signals governance/strategy shift

Prior: 'no major price increases needed'. Actual: one price hike in lighting taken Oct 2026, Consumer Products hike under evaluation

BLDC fans up 56%, premium fans down but BLDC driving category. Channel consolidation underway, portfolio shift in progress. Building capacities next 3–6 months.

20–25% of total coming from new business (wires, switches). Focused on 4 states for penetration and faster growth.

Most categories stable/growing except fans (share lost in '22–'23 due to portfolio change). Now recovering with BLDC ramp. EPC separation changed the baseline; next 2 years will show correction.

Q-o-Q +56%. Premium + BLDC = 30% of ceiling fan portfolio. Average pricing ₹2,500–3,000. Ramping capacity next 4–6 months to accelerate.

Water heaters better margin profile. One price hike in lighting Oct 2026. Evaluating Consumer Products hike. Inflation on metals and plastics; half to be absorbed by productivity, half by pricing.

Channel improved, inventory discipline good. Wires launched Feb 2026, still small. FY28: grow double-digit ahead of market (if market 8%, grow 10%; if 6%, grow 8%). EBITDA margin: double-digit, dynamic based on opportunities.

In next 2–3 years, surpass INR320 Cr EBITDA — that will happen. Focus on 2 brands (Bajaj, Morphy Richards). No plans to exit fans, lighting, or kitchen appliances. Channel synergies and innovation are the way forward.

Conditional (if market 8%, grow 10%; if 6%, grow 8%). Wires scale-up, BLDC ramp, consumer lighting new categories expected to drive.

Actual result; commodity costs and market consolidation cited as headwinds. Below prior explicit 8–10% quarterly guidance.

No specific number given; 'dynamic based on opportunities.' Vague hedging suggests uncertainty on delivery given Q2 margins only 4.4%.

Currently 4% actual, 5.9% adjusted ex-brand. Material shortfall vs prior guidance; no formal restatement but clearly missed.

Currently 3.1%, down 1.3% YoY. Guidance withdrawn; professional lighting pressure and consumer mix shift cited.

New BLDC production lines coming online in next 3–6 months; capacity will support 50%+ growth trajectory.

Q2 FY27 delivered only 1.5% growth. Management cites commodity costs and market consolidation but no detailed action plan to return to 8–10% target. BLDC ramp and wires launch nascent.

Keshav Garg (CCIPL) pointed out that Bajaj has underperformed even smaller players, losing share in fans for 2–3 years. Stock price unchanged vs 16 years ago. Management admits loss but argues on EPC separation baseline.

Consumer EBIT 4% vs 6–7% guidance; Lighting EBIT 3.1% vs double-digit target. Reported EBIT 4.4% vs stated goal of double-digit profitability. Cost control improving but pricing discipline hesitant (price hike taken late, evaluating more).

Lighting revenue down 1.3% YoY. Professional lighting declining; lost some bids due to cost selectivity (inflation headwinds, unwilling to drop margin). Consumer lighting up double-digit on wires/switches but small base.

Shekhar announced transition out of CEO role after Q2 call, moving to Non-Executive Director. Sudarshan Sampatikumar (Independent Director) to become Non-Executive Independent Chairman. Sanjay Sachdev continues as MD-CEO. Signals governance change; execution capability untested on turnaround.