Consumer Electricals Q2 Preview - A Likely Soft Quarter; Channel Hopes For Strong Festive Demand: Systematix


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Systematix Research Report

We expect a soft Q2 FY23 for the consumer electricals sector owing to weak consumer sentiment due to commodity inflation and likely economic slowdown.

However, leading players filled enough channel inventory in the latter part of the quarter, anticipating strong festive demand (with more channel filling likely in October, prior to Diwali).

But margins may remain weak and broadly stable QoQ as we expect moderate demand and inadequate price hikes to offset the benefits from lower key raw material prices.

Companies continue to focus on growth over margins (with uptick likely in H2, per management commentaries).

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