1. At a Glance
A household name selling everything from fans to floodlights. Bajaj Electricals is deep into the FMEG market, but with a 69x P/E and sluggish sales growth, it might be more fuse than flash. Is this just another overcharged legacy stock?
2. Introduction with Hook
Imagine a company that lights up tunnels, cooks your dinner, cools your room… and somehow still struggles to electrify its P&L. Bajaj Electricals, part of the Bajaj legacy, should’ve been India’s Philips meets Siemens — instead, it’s been limping with a 5-year sales CAGR of negative 1%.
- FY25 Net Profit: ₹133 Cr
- ROE: 7.52% — lower than your FD return after tax.
Will new CEO Sanjay Sachdeva flip the switch?
3. Business Model (WTF Do They Even Do?)
Bajaj Electricals operates across two key verticals:
- Consumer Products: Fans, appliances, lighting, Morphy Richards (premium brand), Nirlep (cookware).
- Lighting Solutions (LS) & EPC: Smart street lighting, tunnel illumination, power distribution infra.
It’s part FMEG, part infra-lighting EPC. A confusing combo — one sells ceiling fans, the other lights up highways.
4. Financials Overview
📊 FY25 Standalone Financials (₹ Cr)
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 4,889 | 4,639 | 4,826 |
| EBITDA | 375 | 260 | 307 |
| Net Profit | 216 | 132 | 133 |
| OPM (%) | 8% | 6% | 6% |
| EPS (₹) | 18.8 | 11.4 | 11.6 |
Takeaway: Revenue is in a coma. Margins dipped post-COVID spike. And profit? Flat as a dosa.
5. Valuation
- CMP: ₹675
- Book Value: ₹135 → P/BV = 5x
- P/E: 69x (for a company growing at 0%)
Fair Value Estimate:
- Average sector P/E: ~40x
- On FY25 EPS of ₹11.6 → Fair Price Range = ₹400 – ₹475
- Current price = Hope Premiumâ„¢
6. What’s Cooking – News, Triggers, Drama
- New CEO: Sanjay Sachdeva appointed with a ₹5.17 Cr pay + incentive plan. Can he cook up a turnaround?
- Tunnel Lighting Tie-Up: Strategic deal with SEAK S.R.O. — betting big on infra-lighting.
- Middle East Play: Subsidiary incorporated in UAE — perhaps aiming to fan the Gulf breeze with Morphy Richards?
- Tax/GST Woes: Rs. 4.3 Cr GST demand upheld in July. Not a deal breaker, but a buzzkill nonetheless.
7. Balance Sheet
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Net Worth | ₹1,907 Cr | ₹1,441 Cr | ₹1,559 Cr |
| Total Borrowings | ₹101 Cr | ₹215 Cr | ₹243 Cr |
| Fixed Assets | ₹770 Cr | ₹916 Cr | ₹950 Cr |
| Total Liabilities | ₹4,993 Cr | ₹3,833 Cr | ₹4,053 Cr |
Takeaway: Clean balance sheet post EPC exit. Leverage manageable. Assets are mostly operational, not parked in landbanks.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY23 | ₹449 Cr | -₹88 Cr | -₹139 Cr | ₹223 Cr |
| FY24 | ₹354 Cr | -₹449 Cr | -₹133 Cr | -₹227 Cr |
| FY25 | ₹347 Cr | -₹195 Cr | -₹146 Cr | ₹6 Cr |
Operating cash = steady. But investments in assets and moderate financing costs keep the net cash flow grounded.
9. Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROE | 11.5% | 7.4% | 7.5% |
| ROCE | 18.0% | 13.0% | 12.2% |
| Interest Coverage | 6.9x | 4.1x | 4.4x |
| OPM | 8% | 6% | 6% |
| Cash Conversion Cycle (days) | -6 | -30 | -35 |
Comment: Negative working capital is good. ROCE falling = not so good. Margins need a Red Bull.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | EBITDA | Depreciation | Interest | Net Profit |
|---|---|---|---|---|---|
| FY23 | ₹4,889 Cr | ₹375 Cr | ₹74 Cr | ₹44 Cr | ₹216 Cr |
| FY24 | ₹4,639 Cr | ₹260 Cr | ₹110 Cr | ₹63 Cr | ₹132 Cr |
| FY25 | ₹4,826 Cr | ₹307 Cr | ₹144 Cr | ₹70 Cr | ₹133 Cr |
Takeaway: Despite better EBITDA in FY25, higher depreciation + interest have zapped PAT growth.
11. Peer Comparison
| Company | Rev (₹ Cr) | Net Profit | ROCE | P/E | OPM | ROE |
|---|---|---|---|---|---|---|
| Voltas | 15,413 | 823 | 17.6% | 55x | 6.4% | 13.35% |
| Blue Star | 11,968 | 585 | 26.2% | 64x | 7.3% | 20.62% |
| V-Guard | 5,578 | 310 | 19.5% | 57x | 9.2% | 15.85% |
| Bajaj Elec | 4,826 | 133 | 12.2% | 69x | 6.4% | 7.52% |
Verdict: Same sector. Lower returns. Higher P/E. Something’s not plugged in right.
12. Miscellaneous – Shareholding, Promoters
- Promoters: Stable at 62.72%
- FIIs: Down from 11.2% to 7.9% in 2 years.
- DIIs: Slightly up at 15.6%
- Retail: Hovering at ~14% — not much action
Other Facts:
- Dividend Yield: 0.44%
- 26% payout ratio = at least they’re trying.
- No pledge. No dilution. Good governance track record.
13. EduInvesting Verdictâ„¢
Bajaj Electricals has the brand. It has the distribution. It even has Morphy freakin’ Richards. But what it lacks is… momentum.
Revenue hasn’t moved in 3 years, despite new geographies and product launches. Even with decent cash flows and margin potential, it’s priced like it just invented a flying air fryer.
Triggers to watch:
- FY26 sales revival post infra-lighting and UAE push
- Will Sanjay 2.0 (new CEO) deliver better power metrics than Sanjay 1.0?
- Re-rating only if revenue accelerates and margin hits 10%+
Metadata
– Written by Prashant | July 19, 2025
– Tags: Consumer Durables, Bajaj Electricals, FMEG, Morphy Richards, Bajaj Group, Turnaround Stock
