Crompton Greaves Consumer Electricals Ltd Management Discussions

Economic overview

Global economy

The global economy is projected to grow modestly in the Financial Year 2024-25. Demonstrating remarkable resilience, it is characterised by divergent growth paths between developed and developing countries and influenced by employment dynamics, consumer behaviour, regulatory changes, geopolitical tensions, sustainability initiatives, and monetary policies.

The inflationary pressures have shown signs of stabilisation. However, several factors—including energy prices, supply chain disruptions, and labour costs—could maintain upward pressure. Advanced economies are seeing faster disinflation, while emerging markets face mixed trends, particularly in countries dealing with currency depreciation and supply- side constraints. Consumer spending was moderate as inflation pressures persisted and interest rates remained high leading to adjusted spending habits favouring essential goods over discretionary items.

Sustainability continues to be a significant theme in the global economy for Financial Year 2024- 25. Countries are increasingly prioritising green energy and sustainable practices. Governments and organisations are investing in renewable energy projects, aiming for carbon neutrality and the circular economy. Regulatory landscapes are evolving, particularly in response to rising concerns over environmental sustainability, privacy and data security and pushing towards increasing norms on energy consumption.

Geopolitical tensions, monetary policy divergence and financial market volatility continue to pose some risks to global growth impacting supply chains and global trade, along with concerns on investment flows.

Inflation rates in China are expected to remain low and the growth forecast for the country has been slightly increased to 4.6% in 2025, primarily due to carry over from 2024 and a fiscal package that is anticipated to largely counteract the negative impacts of trade policy uncertainty. Chinas growth in 2026 is projected to remain largely stable at 4.5% as the impact of trade uncertainty lowers and the increase in retirement age moderates the decline in labour supply.

The China Plus One strategy is driving manufacturers, particularly in automotive and electronics, to expand into India, Vietnam and Mexico. This involves the establishment of local production facilities along with diversification of supply chains, aiming for longterm global presence outside China. This widespread shift is expected to trigger debates on geopolitics, intellectual property and environmental sustainability.

The US Federal Reserve reduced interest rates by 25 basis points (4.25% to 4.50%) to stimulate economic activity, but increased tariffs are expected to significantly affect the global economy, potentially reducing global output by at least 1% and increasing recession risks with further escalation of the trade conflict. This move has triggered market instability and a shift towards safe-haven assets like gold and US Treasuries. Amidst this uncertainty, opportunities may arise in European stocks, the Japanese yen, and defensive assets, highlighting the value of diversification in volatile market conditions.

Meanwhile, the rising prevalence of Artificial Intelligence across every facet of life is having an impact on the world in different ways. Al could double annual global economic growth by 2035, across 12 developed economies, through increasing labour productivity (up to 40% via efficient time management), creation of a new ‘intelligent automation virtual workforce and the widespread diffusion of innovation, generating new revenue streams. It can also have a larger impact, a potential 14% boost to global GDP (USD 15.7 trillion) by 2030 due to Al adoption, propelled by the vast data generated from the Internet of Things (loT).

Outlook

The global economy is expected to report steady growth of 3.3% in 2025 and 2026, below the historical average of 3.7%. Despite uncertainties, the global economy is showing signs of stabilisation as inflation rates move closer to target but tightening monetary condition might decelerate growth in advanced economies.

Uncertainty around trade, fiscal and regulatory policy is expected to soften the growth momentum of the US economy. Consumer spending is also expected to advance at a measured pace, mostly due to higher cost of living and elevated interest rates. The Eurozone is expected to see a gradual recovery, driven by an improved financial stance and stronger domestic spending. Chinas economic expansion is projected to decelerate due to long-term structural issues and demographic changes, while India is expected to maintain its robust growth.

Indian economy

The countrys estimated real GDP growth of 6.4% in FY25 reflects deceleration in growth rate post the upward revision in FY 24. Indias consumption and discretionary spending has been stressed over the last couple of years due to the macroeconomic headwinds like surge in inflation and stress on wages and slowdown in credit origination volumes. In FY25, the private consumption was supported by improving urban employment and rising incomes while ruralconsumption has been robust led by strong agricultural performance and the services sector continues to be a key driver of growth.

Manufacturing exports, particularly in high-value- added components (such as electronics, semiconductors, and pharmaceuticals), have displayed strength, underscoring Indias growing role in global value chains. Governments flagship programmes, including Make in India, Start-up India, Digital India, the Smart City Mission, and the Atal Mission for Rejuvenation and Urban Transformation has opened immense opportunities in India.

Inflation in India has moderated, with retail inflation easing from 5.4% in the previous year. However, food inflation remains a concern due to supply-side disruptions. The Reserve Bank of India (RBI) has projected headline inflation at 4.8% for FY25, gradually aligning towards the target range by FY26.

The Indian economy has witnessed steady growth positioning India as one of the fastest-growing major economies in the world, beyond by strong domestic demand, government reforms, and evolving global economic dynamics.

Growth of the Indian economy, although moderating mostly due to a sharper than expected deceleration in industrial activity, has remained on a steady growth track despite global headwinds and sluggish performance of some advanced economies. The countrysreal GDP growth is estimated to be 6.4% in FY25, driven by robust domestic consumption, sustained public investment and resilient agricultural output. However, manufacturing faced headwinds due to weaker global demand and seasonal domestic factors. Private consumption remained stable, supported by improving urban employment and rising incomes.

Inflation in India has moderated, with retail inflation easing to 4.6% in FY25 from 5.4% in the previous year. However, food inflation remains a concern due to supply- side disruptions. The Reserve Bank of India (RBI) has projected headline inflation at 4.8% for FY25, gradually aligning towards the target range by FY26. Indias real wages have declined below pre-COVID (FY18) levels in FY24. Simultaneously, credit origination volumes softened, with credit card uptake slowing down by 30% and home loans down by 10%, indicating economic strain.

During Budget 2025, a number of announcements related to the durable sector were made and it is expected to have a considerable influence on the industry , for instance changes in custom duty, increased duty on interactive flat panel displays and reduced custom duty on open cells. These developments are expected to encourage local manufacturing and promote self-reliance in the electronics manufacturing sector. Moreover, the governments decision to waive personal income tax of around I 1 Lakh Crore isanticipated to enhance consumer demand for consumer durables, especially premium products.

The RBI has announced a 25-basis point repo rate cut, reducing it to 6%. It is expected to lower borrowing costs for banks, potentially leading to reduced interest rates on home, personal and vehicle loans, thus providing relief to borrowers and eventually boosting growth.

Outlook

Indias growth trajectory for FY26 is expected between 6.3% and 6.8%. While external risks such as geopolitical tensions and trade disruptions persist, strong demand from rural and semi-urban markets is likely to outpace demand from urban markets, improving consumer confidence and an expected revival in private investment provide a favourable outlook. The governments push for structural reforms, coupled with continued emphasis on infrastructure and digital transformation, will be instrumental in sustaining the growth momentum.

While inflation is expected to moderate further, food price volatility and global commodity trends pose potential risks.

Overall, India is well-positioned to navigate global uncertainties. The focus on enhancing productivity, expanding manufacturing capabilities and attracting investments in different sectors will be critical for ensuring long-term economic resilience.

Industry overview

Electrical Consumer Durables industry

After witnessing double digit growth in 2024, the Electrical Consumer Durables (ECD) industry has posted modest growth in FY25 with mixed consumption trends in Q4 FY25. The amalgamation of a burgeoning middle class in urban areas and the aspirational demand emanating from rural India has helped the industry momentum with consumer seeking products that blend feature and aesthetics. Increased rural electrification and growing real estate sector are creating demand for consumer durables. There has been a surge for appliances with smart features that integrate with other devices, a shift towards higher capacity/ sizes at limited incremental cost and the rising preference for efficient appliances with lower operating costs. The push for energy efficiency, through Bureau of Indian Standards (BIS) and Bureau of Energy Efficiency (BEE) star ratings has been shaping consumer preferences.

India is the third-largest producer and consumer of electricity globally, with an installed capacity of 466.24 GW . Notably, the nation holds the fourth rank worldwide in both solar power and total renewable energy capacity. Significant progress has been made in electrification, with over 28.6 million households connected under the Saubhagya scheme, nearing complete household electrification. Around 217.62 GW of power generation comes from non-fossil fuel sources also. India is also the third-largest producer of renewable energy, with renewables constituting 46.3% of its total installed capacity (203.18 GW of 452.69 GW) as of October 2024.

By 2025, Indias Consumer Electronics and Appliances Industry is expected to be the fifth largest in the world*, with increase in Foreign Investment (FDI) reflecting growing confidence in the sector. The Production-Linked Incentive (PLI) scheme has also played a vital role in strengthening domestic manufacturing, strengthening Indias position in the global consumer durables and electronics market.

* IBEF Indian Consumer Durables Industry Analysis

Fans

The Indian fan industry is projected to grow given the tropical climate, increasing demand of aesthetic fans, adoption of smart technology and gain in awareness of energy- efficiency. Increasing investments in housing infrastructure are offering a favourable ceiling fan market outlook. The popularity of technologically advanced, remote-controlled and smart fans incorporating IoT and AI featureswill increase. Online platforms are also helping expand the market reach, connecting urban and rural consumers.

The Indian fan industry is projected to grow at CAGR of 11.50% by 2030 driven by tropical climate, increasingly seeking of aesthetic fans, adoption of smart technology and gain in awareness of energy-efficientfans. Increasing investments in housing infrastructure are offering a favourable ceiling fan market outlook. The popularity of technologically advanced, remote-controlled and smart fans incorporating IoT and AI features will increase. Online platforms are also helping expand the market reach, connecting urban and rural consumers.

Pumps

The pump market in India is on a steady ascent, powered by a surging demand from agriculture, water and waste water management, construction and diverse industrial applications.

The increasing investments in high-quality infrastructure by the government have opened wider channels for innovating pumps. In the agricultural sector, increased adoption of advanced irrigation methods has necessitated theuse of water pumps by farmers under government programmes. There is a growing emphasis on energy-efficient pumps to lower operational costs and minimise environmental impact. Also, the increasing use of centrifugal pumps across the domestic and residential sectors, owing to its simple design, easy maintenance, and smooth flow rate, is also a key trend adding to the market growth.

The Indian solar pump segment is expanding significantly. Government schemes such as PM-KUSUM, increase in awareness about sustainable irrigation and demand for more power in the agriculture sector is driving the demand for these pumps. Besides, government subsidies, and declining solar component costs have improved affordability of solar pumps.

Large Domestic Appliances

Home appliances is one of the growing industries in India wherein the consumer preferences and purchase journey has been evolving. Lifestyle changes in urban areas have boosted the demand for smart appliances, technological innovations like IoT and AI and e-commerce penetration has increased awareness. Competitive pricing and special offers during festivals arefurther shaping the purchasing habits of modern consumers, driving the increased uptake of large domestic appliances. The rise in heatwave is driving a shift in buying and usage patterns, with a growing demand for cooling solutions.

However, the relatively low penetration of large domestic appliances in India presents asignificant opportunity for the industry to capture a larger market share. The industry is expected to more than double by 2030 along with growing demand for premium and smart products with advanced features, durability, energy efficiency, aesthetics, safety, and personalisation.

Small Domestic Appliances

The India kitchen appliances market is driven by evolving consumer preferences towards modern kitchen technologies and supported by government initiatives promoting energy-efficient products through BEE (Bureau of Energy Efficiency) ratings. The introduction of smart and connected kitchen appliances has also significantly contributed to the markets expansion as urban households increasingly adopt advanced technology. There is emphasis on enhancing localisation,research and innovation, increasing regulatory norms and offering forward-looking sustainable solutions, propelling India towards becoming a global hub for manufacturing.

Rapid urbanisation is transforming lifestyles and purchasing habits. Rising disposable income has also led the demand for futuristic products that minimise manual labour at home. The adoption of smart home appliances is

also increasing due to growing preferences for user-friendly features that make certain products the perfect companion for modern homes.

The Indian Small Kitchen Appliances eCommerce market is also a major contributor to the segment and accounts for 10.5% of the Household Appliances eCommerce market in India.

Large Kitchen Appliances

Evolving consumer demographics and lifestyle shifts, notable increase in disposable incomes and accelerated pace of urbanisation continues to drive the demand for sophisticated, space-optimised kitchen solutions. The kitchen has evolved from a tucked-away space to a central and often integrated part of the home, frequently blending seamlessly with the living area. Rising incomes drive demandfor premium, convenient, and stylish appliances. Energy-efficient and AI-integrated technologies, coupled with digital awareness, boost smart appliance adoption.

The journey of cooking appliances has progressed from traditional standalone cooktops to integrated hobs, driven by modern kitchen design and a desire for seamless aesthetics.

Technological advancements further propelled this shift, introducing efficient and safer induction hobs. While smart features are emerging, transforming hobs beyond simple cooking surfaces, the core evolution highlights a move towards integrated, designconscious, and increasingly efficient cooking solutions.

Lighting

LED lighting has emerged as a powerful source for lighting industry over the past several years. Transition to LED technology, the adoption of smart lighting solutions, government initiatives and regulations and the focus on aesthetics have collectively driven the India lighting market growth. Within B2C segment, ceiling lights continue to grow and expected to form majority of lighting portfolio in next 5 years However, the Indian lighting marketis highly competitive owing to the increasing entrants including regional players. Within the B2B segment, the UJALA and street lighting national programs have been driving the demand of street and solar lighting.

While LED lighting market is at a nascent stage, it offers innumerable opportunities for growth over the next few decades as India is one of the biggest lighting markets.

The market is expected to grow strong double digit led by increasing LED adoption . The demand will be fuelled by energysaving awareness, government initiatives and the use of LED lights for diverse applications. Urbanisation and infrastructure development has further boosted demand, particularly for outdoor and commercial LED lighting.

Key growth drivers

Changing lifestyle preferences

Modern consumers seek holistic solutions that seamlessly integrate with their lifestyle. They desire products that not only fulfil immediate needs but also resonate with their aspirations, reflect their unique identities and enhance their overall wellbeing. This evolution towards lifestyle-centric purchasing demands a fundamental shift in how businesses approach product development and marketing. Companies are prioritising innovation and personalisation, crafting products that cater to evolving consumer preferences, to remain relevant and competitive.

Omnichannel availability

At 14% channel saliency, Indias consumer durable online segment has lot of potential to grow. Manyadvanced countries have 5070% business coming from online channel. While TVs lead with 2025% online share, major appliances hover at 10-15%. The governments ONDC initiative aims to boost e-commerce, targeting a rise in retail salience from 8% in FY23 to 25% by FY25.

The Indian Q-commerce market is valued at INR 287.6 billion (FY 2024) and is projected to reach USD 9.95 billion by 2029, growing at 76% YoY, and 12% of urban consumers now prefer quick commerce, up from 5% two years ago. Online growth is expected to be driven by brand choice, home delivery options and expanding infrastructure in tier-2 and tier-3 cities. Companies are also willing to provide holistic customer experiences through improved installation facilities, after-sales support, spare parts availability and the creation of a resale market.

Sustainable choices

Evolving consumer preferences and Indias commitment to sustainability are driving a strong impetus for appliance manufacturing. Rising temperatures are increasing cooling demand and resulting in the demand for energy-efficient solutions. The India Cooling Action Plan (ICAP) and BEE star labelling programme are stimulating innovation in sustainable cooling technologies.

The growing global emphasis on sustainability is driving a significant consumer shift towards eco-friendly and energy- efficient products. This trend offers a strategic opportunity for businesses to differentiate themselves by developing and promoting products that align with broader environmental objectives and demonstrate a strong commitment to corporate social responsibility.

Consumers willing to pay

9.7%

Sustainability premium

Brand strength

A brands strength is its ability to communicate trustworthiness, dependability and a proven history of excellence. These qualities significantly influence consumer decisions, with people favouring brands that have demonstrated consistent reliability and high quality over a longer period of time.

Technological innovations

The rapid pace of technological innovation presents significant opportunities for the consumer durables sector. By strategically investing in the development of smart appliances and connected devices, companies can cater to the market demand for advanced products. Focus on cutting-edge products, including those that enhance home automation, is essential for driving future growth and establishing a competitive edge through continuous innovation.

Growing middle- class population

The middle class represents a significant growth catalyst for the consumer durables sector.

As disposable incomes increase, a broader segment of the population has the capacity to purchase consumer durables.

An expanding consumer base directly translates to heightened demand across diverse product categories, creating substantial market opportunities.

47%

Middle class population by 2030-31

Rising preference for health and well-being

Consumers are increasingly prioritising products that ensure health and well-being. It presents a significant opportunity for companies to develop smart products that align with consumer

preferences. By introducing premium feature-rich products that offer health benefits, businesses can capture a valuable market share.

Smart-home trends

The growing trend for smart homes, equipped with IoT and AI enabled products, has uncovered new avenues of growth for the consumer durables sector. Products that seamlessly connect with other smart devices and contribute to a comprehensive smart home ecosystem are experiencing substantial demand. This presents a valuable opportunity for companies to innovate and capture a lucrative market.

Government initiatives

Public infrastructure is a key focus for Indias economic growth, evidenced by a H 10 lakh crore budget allocation in 2023-24.

The PM Gati Shakti initiative aims to streamline infrastructure planning for better connectivity and efficiency. Expansion of the national highway network, currently at 1,46,145 km, is also a priority. These infrastructure advancements are projected to bolster economic growth, improve connectivity and enhance living standards. Additionally, government schemes such as the ‘PM Kusum Scheme for solar pumps, ‘Housing for All, ‘Power for All, and rural electrification are anticipated to significantly contribute to the progress of the consumer durables sector.

10 Lakh Crore

budget allocation for public infrastructure

Company overview

With a rich legacy of more than 85 years, Crompton is a leading player in the Indian consumer electrical industry. Operating in the ECD and Lighting segments, we provide products under the ‘Crompton and ‘Butterfly brand, both in India and abroad.

We embarked on our second phase of transformation with the implementation of Crompton 2.0.

It offers strategic direction to our business and solidifies our market leadership across segments.

In the Financial Year 202425, the Company unveiled #TechWithHeart, representing our mission to create smart, responsible and high-performance solutions tailored to meet diverse and evolving consumer needs. It has enabled us to outperform in a competitive market. Strategic investments in brand development, innovation and talent acquisition have further influenced our growth trajectory.

Our commitment to sustainability has set us apart among peers

> Ranked #1 in India for sustainability in household durables industry

> Ranked #3 amongst global peers in household durables industry

> Ranked #4 in the Dow Jones Sustainability (DJSI) for sector

Crompton 2.0

Crompton 2.0 aims to deliver sustained growth over the long term. It enables us to adapt to evolving industry trends and solidify our position in a dynamic environment. The tenets of Crompton 2.0 include:

> Enabled and empowered organisation

> Consumer need-led innovation

> Premiumisation of portfolio

> Supply chain excellence

> Go-to-Market excellence

> Digital enablement

Butterfly Gandhimathi Appliances Limited

Butterfly Gandhimathi Appliances Limited (Butterfly) is a renowned kitchen appliances manufacturer, recognised for its emphasis on innovation and quality. With a strong market presence, especially in Southern India, Butterfly offers a broad portfolio of products, including LPG stoves, pressure cookers, mixer grinders and wet grinders.

Crompton holds 75% stake in Butterfly to strengthen its position in the kitchen appliances segment. By leveraging Butterflys market leadership in southern India, Crompton benefits from its advanced manufacturing and R&D capabilities, and a robust distribution network.

This year, Butterfly is undergoing strategic brand repositioning.

Our collaboration with Butterfly allows it to leverage our innovative capabilities and strong supply chain for faster time-to-market, cost savings, and broader distribution. Internally, Butterfly has restructured its marketing to enhance upstream activities like consumer insights and product development, alongside downstream communication and marketing. To further expand Butterflys reach, they have launched targeted social media campaigns, such as the #CookingAtHome initiative.

Manufacturing

Embracing lean manufacturing principles and through the integration of advanced technology we have streamlined our production processes to enhance efficiency and lower operational costs. Investments for process optimisation has also resulted in efficient resource utilisation. This year, we have strategically reinforced our supply chain to achieve operational excellence, focusing on timely and cost-efficient delivery, enhanced productivity, robust risk management, and optimised procurement. We have also developed a strategic sourcing footprint for fans and expanded production capacity at the Baddi plant. We also moved towards in-house PCB development of Nucleus for BLDC fans.

With the acquisition of Butterfly, we have broadened our manufacturing capabilities.

Key initiatives including Project Udaan, a five-year initiative launched in 2019. These projects focus on enhancing manufacturing excellence, optimising ‘Make vs. Buy decisions, augmenting our manufacturing network, achieving sourcing excellence and ensuring technical advancement across our operations.

Innovation centre

Innovation is central to Cromptons sustained growth.

We utilise technology to improve our products and create ecofriendly solutions. Our Innovation Centre has been instrumental in accelerating the introduction of new products and has enabled us to obtain new patents and design registrations.

Every business segment has specialised teams for focusing on various elements of New Product Development (NPD), such as design, development, project management and product testing. Adhering to government regulations, these teams utilise engineering tools and software to deliver cutting-edge solutions that align with evolving customer preferences. It has resulted in the introduction of several products with a specific focus on design, usability and energy efficiency.

Our R&D philosophy centres around creating products that seamlessly integrate into users lives, offering both functionality and aesthetic appeal. This approach manifests in several ways. The anti-dust fan and antibacterial mixer grinder, for instance, ensures the health and well-being of users. Similarly, intuitive designs and user-friendly elements such as ergonomic knobs and spill-proof designs underscore our commitment to simplifying daily tasks.

Crompton unveiled its ‘TechWithHeart philosophy, underscoring its dedication to ‘Innovation that Listens, Tech that Cares by creating smart, responsible, and high-performance solutions rooted in consumer needs. Demonstrating this commitment, we launched 170 new products, including energy- efficient fans like the HS Duro and Avancer Swirl, alongside new pump models and expanded our lighting solutions portfolio.

Development of the indigenous NUCLEUS BLDC platform reiterates our commitment to innovation by enhancing fan performance, reliability, and efficiency with smart connectivity. The XTECH platform further reinforces our leadership in induction fan technology with improved energy efficiency and durability. Tofurther our sustainability efforts in product innovation, we actively seek to minimise energy usage and environmental impact of our products. This commitment is validated by achieving Green-Pro certification from CII-IGBC for our fans, following a product carbon footprint assessment.

Brand

Our marketing strategy focuses on maximising reach and strengthening our competitive edge. Utilising a dynamic, data- driven approach, we leverage traditional and new-age media to create brand recall and loyalty. We employ innovative formats to capture the attention of our target audience. Digital integrations on Cricbuzz, for instance, drives brand recall for our air coolers campaign. In the fans category, we collaborated with celebrity influencers to showcase the efficiency as well as aesthetic value of our products. For kitchen appliances, we partnered with a celebrity couple to build a deeper emotional connection with our audience. These initiatives boostconsumer engagement and help to maintain our brands prominence through reach, relevance, and innovation.

Our future-ready marketing ecosystem integrates online and offline experiences. Recognising the fluid nature of consumer interaction, we strive to blend digital discovery with offline retail experience by demonstrating product benefits to customers.

By leveraging technology and digitisation, we create a connected, omnichannel experience that keeps our brand relevance intact and creates greater awareness about our products.

Our brand excellence is built on a deep consumer-centric culture,driven by extensive market research engaging over 15,000 individuals to understand evolving preferences. This insight fuels our impactful communication strategies, exemplified by the ‘Picture Perfect Fans campaign highlighting premium aesthetics, and our messaging around being Indias leading energy-efficient water heater brand. Also, we collaborated with celebrity influencers such as Genelia Deshmukh for our mixer grinder campaign, promoting the ‘Secret of Fine Taste. This consumer- first approach enables our products to resonate with actual consumer preferences and helps to strengthen our brand proposition across categories.

Supply chain

We are dedicated to achieving operational excellence through streamlined and cost-efficient product delivery. Our supply chain resilience has enabled us to optimise procurement processes, meet production targets and minimise risks. Project Unnati is also being continuously implemented, aimed at elevating manufacturing excellence across Crompton and its vendors facilities.

We employ a rigorous process for onboarding new suppliers, following a detailed assessment protocol. It evaluates suppliers based on their operational capabilities, product quality, punctuality and adherence to legal and environmental standards. We have increased multi-sourcing by 10% across new and legacy products and partnered with consultants to improve the process for onboarding of local vendors.

It has enabled us to source high-quality products and ensure cost- effectiveness.

We are strategically refining our supply chain footprint for optimal cost-effectiveness and product quality, leveraging Crompton and Butterflys strengths. This includes identifying key strategic suppliers based on comprehensive criteria such as capability, quality, compliance, sustainability, cost and financial stability. We have upgraded our warehouses to optimise our supply chain and consolidated the vendor base by building long-term relationships with multi-business unit suppliers, using a third-party aggregator for enhancing efficiency.

Quality

We are committed to achieving operational excellence by embedding quality across our value chain. This is driven by a culture of continuous improvement, fostered through programmes like 5S, Quality Circles, and Daily Work Management, andsupported by initiatives like ‘Glass Walls that promote transparency and accountability. We also empower our teams with 6 (Six) Sigma methodologies to tackle complex quality challenges, ensuring continuous improvement and exceptional value for our customers. Furthermore, we have implemented a Vendor Capabilityenhancement programme to improve the processes and systems of our top suppliers. This collaborative approach enhances their quality and supports cost optimisation efforts.

People

At Crompton, we strive to create an empowered workforce, aligned with our values. This year, we focused on strategic talent acquisition, enhanced employee engagement through surveys and skill development through robust learning and development programmes. Digital HR transformation has been a key focus, with improved payroll systems and planned facial recognition attendance. We also prioritise employee well-being and foster a culture of diversity and inclusion. This has also led toincreased female participation in our workforce. Our values and 6C framework are integrated into daily operations, ensuring ethical and responsible practices across the organisation.

We cultivate a strong, value- driven culture through our 6C framework, which is being further embedded with the launch of 6C 2.0, a playbook for a learning organisation, and capabilitybuilding clubs led by senior leaders. This year, we fostered increased employee engagement through initiatives like Family Day and our comprehensive Employee

Engagement Survey, ‘Pulse, which achieved an 88% response rate. To enhance internal communication and connection, we have also implemented digital initiatives such as the SyncUp intranet portal, facilitating real-time updates, celebrating achievements and providing quick access to company applications.

Looking forward, we seek to improve our HR programmes, foster interdepartmental relationships and encourage a culture of continuous learning.

Sustainability

We are committed to implementing sustainable and green practices throughout our operations. Our manufacturing facilities are equipped with energy, water and waste management systems to ensure responsible resource consumption. We are committed to meeting regulatory requirements and aligning with global sustainability frameworks. We have also launched an ESG Dashboard to track and improve our sustainability efforts, which helps us consolidate data, improve decision-making abilities and monitor key performance metrics like greenhouse gas emissions and resource usage.

We have automated processes to enhance efficiency and reduce our environmental footprint. We focus on environment-friendly biodegradable packaging options in place of conventional packaging such as thermocol and asbestos. Our initiatives for water conservation have resulted in nowastewater release at any of our production facilities, showcasing our commitment to safeguarding natural resources.

We are embedding sustainability into our product development process, starting with a comprehensive product carbon footprint assessment across seven representative categories. This commitment to environmental responsibility is reflected in ourimproved performance in the Dow Jones Sustainability Indices (DJSI) ESG Assessment 2024, where we achieved 61/100, ranking 4^th in the DHP Household Durables industry, and our inclusion in the S&P Global Sustainability Yearbook 2025.

This progress demonstrates our focus on creating products with a reduced environmental impact throughout their lifecycle.

Risk Management

We are committed to safeguarding our stakeholders interests through a proactive risk management framework. Our Enterprise Risk Management (ERM) framework is designed to be effective and practical, addressing core business needs. We have structured this withmulti-layered oversight: the ERM Committee, Risk Council, Board Risk Management Committee, and Audit Committee. This enables us to comprehensively identify, assess and mitigate risks, focusing on minimising negative outcomes and maximising market potential.

To ensure transparency and accountability, we conduct third- party internal audits, overseen by the Audit Committee. We employ a thorough risk evaluation process,carrying out 7-8 audits annually. An e-audit portal tracks findings, helps to enhance our internal controls, operational efficiency and regulatory compliance.

This comprehensive approach strengthens our resilience and maintains our competitive edge, ensuring our long-term success.

Cautionary statement

This document contains statements about expected future events, financial and operating results of your Company, which are forwardlooking. By their nature, forwardlooking statements require ourCompany to make assumptions and are subject to inherent risks and uncertainties.

There is significant risk that the assumptions, predictions and other forward-looking statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward looking statements as several factors could cause assumptions, actual future results and events to differmaterially from those expressed in the forward-looking statements. Accordingly, this document is subject to the disclaimer and qualified in its entirety by the assumptions, qualifications and risk factors referred to in the managements discussion and analysis of Cromptons Integrated Annual Report for the Financial Year 2024-25.

Standalone Financial Performance

Ratios
Debtors Turnover Ratio	11.65	11.23
Inventory Turnover Ratio (on Cost of goods sold)	6.48	6.70
Interest Coverage Ratio	27.01	10.77
Current Ratio	1.49	1.52
Debt Equity Ratio	0.08	0.19
Operating Profit Margin	11.66%	10.78%
Net Profit Margin	7.94%	7.23%
Return on Net Worth (RoNW)	16.54%	15.43%

Consolidated Financial Performance

Key highlights of financial performance

Particulars	2024-25		2023-24
	(G in Crore)	% to Revenue from operations	(G in Crore)	% to Revenue from operations
Revenue from Operations	7863.55	100.00%	7,312.81	100.00%
Material Cost	5273.33	67.06%	5,000.31	68.38%
Employee Benefit Expenses	639.03	8.13%	589.87	8.07%
Finance Cost	47.98	0.61%	79.19	1.08%
Depreciation & Amortisation Expenses	152.83	1.94%	128.82	1.76%
Advertisement & Sales Promotion	305.75	3.89%	297.19	4.06%
Other Expenses	757.25	9.63%	711.75	9.93%
Total Expenses	7,176.17	91.26%	6,807.13	93.08%
Other Income	68.83	0.88%	67.39	0.92%
PBT	756.21	9.62%	573.07	7.84%
Tax Expense	192.13	2.44%	131.29	1.80%
PAT	564.08	7.17%	441.78	6.04%