In conversation with Kaleeswaran Arunachalam, Group CFO & Head of Strategy, Crompton Greaves Consumer Electricals Ltd

How did the company perform in Q2FY26 and what were the key factors behind the pressure on bottom-line growth?

In Q2FY26, we delivered stable topline performance and further strengthened our market standing, supported by 3 per cent YoY volume growth, market share gains across key ECD categories, and an exceptional performance by Butterfly. Revenue was up 14 per cent YoY and EBITDA grew 21 per cent. Within the ECD segment, fans showed a sharp recovery versus Q1, pumps registered mid-teen momentum driven by Solar orders, SDA posted double-digit progress, and the Lighting segment remained in single-digit growth.

However, the bottom line remained subdued due to weather-linked headwinds in fans and LDA, along with deliberate upfront investments towards future-proofing the business, including solar scale-up, GTM revamp, premiumisation, regulatory readiness for BEE 2.0, and marketing spends for festive campaigns and new product launches. These are strategic and temporary investments that position the company for sustainable, profitable growth.

Could you walk us through the company’s product portfolio and the revenue contribution across various segments?

Crompton’s portfolio is strategically built around consumer needs in both comfort and convenience, enabling us to participate meaningfully across high-demand categories while maintaining a balanced revenue mix. Our business spans three major segments: Electrical Consumer Durables (ECD), Lighting, and Butterfly, each contributing to scale, profitability, and long-term growth. In addition, we continue strengthening our kitchen portfolio, building a wider base in an attractive and fast-growing category.

• Electrical Consumer Durables (ECD): Comprising fans, pumps, Small Domestic Appliances (SDA), Large Domestic Appliances (LDA), and Large Kitchen Appliances (LKA), this segment accounted for 72 per cent of revenue in Q2FY26, reflecting its central role in driving scale and market leadership.
• Lighting: Including LED lamps, battens, ceiling lights, and outdoor/industrial solutions, this segment contributed 14 per cent of revenue, highlighting our focus on energy-efficient and sustainable solutions.
• Butterfly: Centred on pressure cookers, wet grinders, mixer grinders, and gas stoves, Butterfly contributed 15 per cent of revenue, strengthening our presence in essential kitchen and household categories. As a leading kitchen appliances brand with strong equity in Southern India, Butterfly enhances our portfolio with a comprehensive suite of LPG stoves, pressure cookers, mixer grinders, and wet grinders.

Building on this momentum, we have reinvented the Butterfly brand and introduced the ‘Idea First Series’, a dedicated platform for industry-first innovations designed to set new benchmarks in the category. This initiative reflects our focus on delivering differentiated performance and clear consumer value. The debut products under this series emphasise this intent, while Butterfly’s refreshed range, covering gas stoves, pressure cookers, mixer grinders, and wet grinders, has been thoughtfully grouped to simplify consumer choice and elevate everyday kitchen experiences.

This well-balanced mix enables us to play meaningfully across both comfort and convenience categories while deepening our presence in high-growth consumer segments.

With the solar business positioned as a new growth engine and expected to reach Rs 2,000 crore in revenue over the next 18-24 months, what strategic plans are in place to drive this expansion?

As Crompton charts its next chapter, the solar business has emerged as a strategic engine. Backed by strong policy momentum, accelerating customer adoption, government initiatives, and its increasing relevance in our portfolio, solar represents a meaningful opportunity to scale sustainably and create value.

Our strategy to drive this expansion is built on four key levers:

• Expanding into high-growth segments: We are prioritising solar pumps and rooftop solutions, aligned with initiatives such as PM-KUSUM and the government’s 40 GW rooftop target for 2027.
• Leveraging Crompton’s brand strength: With over eight decades of legacy as a trusted consumer durables brand, Crompton is a preferred choice for millions of consumers. We are extending this trust to our solar offerings, ensuring higher adoption and confidence in the category.
• Strengthening execution capabilities: We have a proven track record of delivering Rs 372 crore in solar pump orders, with over 12,000 pumps deployed. Additionally, a robust rooftop Order Book of Rs 500 crore highlights our ability to execute at scale.
• Driving operational excellence: A dedicated MNRE-aligned design team, rigorous procurement and QA processes, multi-stage audits, and centralised RMS-based monitoring ensure precision, reliability, and superior performance.
• Leveraging distribution and service networks: Our wide-reaching network ensures scalability, superior customer experience, and long-term sustainability.

The rapid adoption of solar in regions like Punjab highlights a structural shift in market demand, replacing conventional agricultural pumps with clean energy solutions. Guided by disciplined capital allocation and a focus on margin-accretive growth, we are confident that solar will significantly expand our addressable market and contribute meaningfully to revenue, profitability, and long-term shareholder value.

Can you share insights on the Baroda facility restructuring, including the new product lines and appliances introduced? Are there any additional capex plans on the horizon?

The Baroda facility restructuring represents a strategic step in Crompton’s journey to build a more agile, efficient, and future-ready manufacturing base. Our objective was clear: optimise costs, enhance operational flexibility, and enable the capability to deliver an expanded portfolio of products.

Key highlights of this transformation include:

• Transition to a Multi-PL Structure: The facility shifted from a single product line (PL) setup to a multi-PL configuration, significantly boosting productivity, operational flexibility, and overall manufacturing agility. This structure enables better workload distribution, process specialisation, and faster responsiveness to evolving product requirements. Importantly, the transition was executed seamlessly, without any disruption to ongoing production or impact on customer deliveries.
• Introduction of New Product Lines: We have introduced BLDC, PCB, and large kitchen appliance assembly lines to broaden the facility’s manufacturing capabilities. An in-house validation lab was also inaugurated, strengthening product testing, ensuring regulatory compliance, and accelerating development cycles. Looking ahead, the team is exploring additional capability enhancements, including a dedicated spares warehouse and solar rooftop assembly, further driving value creation and operational efficiency.

These initiatives collectively position the Baroda facility as a more agile, versatile, and future-ready manufacturing hub, aligned with Crompton’s strategic objectives and growth ambitions.

What are the company’s top three strategic priorities at this stage?

At this stage, Crompton is focused on driving differentiated growth, strengthening market leadership, and building future-ready capabilities. Our top three strategic priorities reflect this ambition and are anchored in disciplined capital allocation, margin delivery, and long-term value creation.

To achieve these objectives, we are sharply focused on consumer-led innovation, delivering high-quality, energy-efficient, and smart solutions. Sustained investments in sustainability, cost excellence, and structural productivity are enhancing operational resilience, supporting both growth and enduring value building.

Our three strategic priorities are as follows:

• Brand Building: We are strengthening our market leadership while deepening consumer trust across our core categories. Building on our strong presence in fans and residential pumps, along with lighting and appliances, we are scaling high-potential categories that deliver sustained profitability, including kitchen appliances and solar solutions such as solar pumps and rooftops, as part of a multi-year plan to significantly increase revenues.
• Portfolio Premiumisation: Complementing our brand-building efforts, we are deliberately shifting our product mix towards high-end, design-led offerings to deliver differentiated consumer experiences. By enhancing in-house design capabilities and elevating aesthetics across categories, we are reinforcing leadership in core segments. Premium launches such as the Idea First Series and advanced BLDC-based innovations are key enablers in this journey.
• Innovation and Capability Building: Innovation is at the heart of our growth strategy, enabling us to deliver superior products while preparing for future market shifts. We are intensifying new product development across fans, Small Domestic Appliances (SDA), Large Domestic Appliances (LDA), and Lighting, supported by a dedicated R&D centre with over 200 experts and an annual innovation spend of Rs 100 crore. Our investments in advanced validation labs, design engineering, and supply chain excellence further strengthen these initiatives. They also position us to scale emerging categories such as Solar Solutions and Large Kitchen Appliances, ensuring our product ecosystem remains robust and future-ready.
• Go-to-Market (GTM) Transformation: Effective market reach is critical to converting innovation and brand strength into tangible growth. Guided by reputed consultant insights, we are revamping our distribution architecture to enhance market penetration, improve productivity, and accelerate coverage. Simultaneously, we are deepening our presence in alternate channels such as E-commerce and Modern Trade, while implementing rural acceleration programmes to unlock the next phase of expansion.

Together, these priorities form a cohesive roadmap aligned with Crompton 2.0’s vision of consumer-led innovation, operational excellence, and sustained value creation. This ensures the company is well-positioned to lead with confidence in a rapidly evolving market.

Given the evolving dynamics in the consumer durables space, how would a GST cut influence your product demand, pricing strategy, and overall growth outlook?

A reduction in GST is a welcome development for the consumer durables sector and is expected to have a positive impact across demand, pricing, and overall outlook.

• Demand Uplift: Lower GST rates are expected to increase disposable income, which could boost demand for white goods, especially at the premium end.
• Pricing Strategy: We have passed on price benefits to consumers in categories where we have received GST-related benefits.
• Growth Outlook: GST 2.0 is expected to enable a phased recovery in durables such as solar water heaters and pressure cookers.

Overall, we view the GST cut as a structural tailwind that reinforces our strategic focus on premiumisation and strengthens the trajectory of Crompton’s key categories.