01 — At a Glance
The Fan Company Becoming Something Else Entirely
- 52-Week High / Low₹368 / ₹217
- Q3 FY26 Revenue₹1,898 Cr
- Q3 FY26 PAT₹112 Cr
- Quarterly EPS₹1.71
- Annualised EPS (Q3×4)₹6.84
- Book Value₹52.8
- Price to Book4.75x
- Dividend Yield1.20%
- Debt / Equity0.05x
- TTM EPS (Latest)₹7.17
The Setup: Crompton just reported its highest-ever Q3 revenue at ₹1,898 crore (+7.3% YoY). EBITDA margin expanded to 10.3%. Net profit up 2.3% despite commodity inflation that would make most companies weep. The stock sits at a 32.7x P/E and has delivered -29.1% returns over the past 12 months. History, meet the new strategy: solar rooftops, residential wires, BLDC premiumization, and a company trading at 2.3x Book Value. Either the market is pricing in apocalypse for the fan business, or it’s underpricing the TAM expansion. Spoiler: it’s probably neither.
02 — Introduction
Welcome to Crompton 2.0: A Fan Company Deciding Not To Die
Let’s talk about Crompton Greaves. For 75 years, the company sold fans. Big fans, small fans, table fans, ceiling fans, pedestal fans—fans for every occasion except the existential one where your business becomes commoditised and gets destroyed by the internet. But somewhere around 2023, the management looked at the strategic mirror and asked the question that matters: “What if we didn’t?”
Enter Crompton 2.0. Not a rebrand. An actual business metamorphosis. The company spent ₹100 crore on R&D in FY25, launched 170 new products, acquired Butterfly Gandhimathi Appliances in 2022 (now 11% of revenue), cracked the top 3 in water heaters and air coolers, and recently announced an entry into residential wires—a ₹36,000–37,000 crore market where Crompton claims a “strong right to win.”
But here’s the kicker: in FY25, the company generated ₹78,636 crore in revenue and posted a net profit of ₹564 crore, good for an 18.5x EV/EBITDA multiple even after going near-debt-free. A decade ago, the stock was at ₹400+. Today, it’s at ₹249 and has delivered -29% over 12 months. The market has decided fans are dead. Crompton is silently building something else. Let’s find out if the market is right, or just lazy.
Concall Highlight (Feb 2026): “Crompton is launching a range of residential wires… products will become available in select markets in the next six to seven weeks.” —Management. Translation: we’ve already done the work. We’re just letting you know we exist now.
03 — Business Model: We Sell Things That Work. Even EV Fluids.
The 75-Year-Old Company Trying Not To Be The Next Nokia
Crompton’s core business is deceptively simple: electrical consumer durables. Fans (26% market share, #1), pumps (27% residential, #1), water heaters (#3), air coolers (top 4), lighting, and post-Butterfly acquisition, kitchen appliances. The company operates through 60% of electrical goods stores in India, 289,000+ retailers (post-acquisition), 28 warehouses, and 7 manufacturing facilities across Goa, Vadodara, Ahmednagar, Baddi, and Chennai.
The business was historically a duopoly-plus-fragmentation play. You sold fans through the general trade, dominated through brand recall and distribution. Margins were stable, growth was 6–8%, and nobody asked questions. Then EV adoption started happening, BEE efficiency norms got stricter (BEE 2.0 effective Jan 2026 for ceiling fans), and commodities started inflating. The answer? Enter adjacent categories and pray you can scale.
Revenue split: Electrical Consumer Durables (76%), Butterfly Gandhimathi (11%), Lighting (13%). The company targets ₹1.5–1.6 lakh crore in addressable TAM by adding wires, solar pumps, solar rooftops, and industrial appliances. It’s not a pivot. It’s a controlled explosion into adjacency.
Fans26%Market Share (#1)
Residential Pumps27%Market Share (#1)
Distribution Reach289K+Retailers All-India
Management Discipline: Crompton explicitly stated it plays “play-to-win” and “play-to-participate” segments. Fans, pumps, water heaters: play-to-win (target leadership). Mobile appliances, smaller categories: play-to-participate (profitable niches). This clarity alone puts them ahead of most Indian companies.
💬 Does the residential wires entry feel like genuine TAM expansion, or FOMO-driven adjacency? Let’s hear your auditor hat.
04 — Financials Overview
Q3 FY26: The Numbers Don’t Lie. The Commentary Does.
Result type: Quarterly Results | Q3 FY26 EPS: ₹1.71 | Annualised EPS (Q3×4): ₹6.84 | TTM EPS: ₹7.17
| Metric (₹ Cr) |
Q3 FY26
Dec 2025 |
Q3 FY25
Dec 2024 |
Q2 FY26
Sep 2025 |
YoY % |
QoQ % |
| Revenue | 1,898 | 1,769 | 1,916 | +7.3% | -1.0% |
| Operating Profit | 195 | 188 | 158 | +3.7% | +23.4% |
| OPM % | 10.3% | 10.6% | 8.2% | -30 bps | +210 bps |
| PAT | 112 | 110 | 91 | +1.8% | +23.1% |
| EPS (₹) | 1.71 | 1.68 | 1.39 | +1.8% | +23.0% |
The Recount: Q3 FY26 marked the highest-ever quarterly revenue in Crompton’s modern era. Revenue growth of +7.3% YoY looks soft on paper. But dig deeper: ECD grew +8% YoY, Lighting +7% YoY, Butterfly +3% YoY. The company is navigating commodity inflation that persisted (steel, copper, aluminium), took pricing actions, and still expanded EBITDA margins by 210 bps quarter-on-quarter. The YoY margin compression of 30 bps? Commodity pass-through lag plus seasonal brand spends. Management flagged January saw “1–1.5% net hike” and two more rounds of price increases planned for Q4 and Q1. This isn’t deterioration. This is inflation management in real-time.
05 — Valuation: Fair Value Range
Is ₹249 Expensive Or Catastrophically Priced?
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