Crompton Greaves showing signs of influence of global cues on markets

Shares of Crompton Greaves, a diversified industrial company, fell more than 2 percent after global brokerage Nomura downgraded the stock to Neutral and cut its price target to 186 rupees post a dismal first quarter performance.

Nomura said in a note to clients it was cutting its EPS estimates for Crompton by 27-60 percent as losses in the International business continue. The brokerage feels that after demerging its cash cow Consumer products business in India, Crompton will have little left to drive profit in the listed entity because domestic power and industrial segments show no signs of recovering.

Shares of Crompton fell 2.5 percent, or 4.4 rupees, to 175.20 rupees on the National Stock Exchange. The stock is down 7 percent over one year compared with the 29 percent rise on the BsE Mid Cap Index and the 13 percent gain on the BSE Capital Good Index.

Last week, Crompton reported its first quarter profit fell to 16 crore rupees from 64 crore rupees a year earlier. Sales during April-June fell to 3,211 crore rupees verus 3,472 crore rupees in the year earlier period.

Crompton's market capitalisation has shrunk 8.2 percent to 11,260 crore rupees over one year as investors searched for other greener pastures.

(Image credits: Indiatimes)