Orient Electric dips 5%, nears 52-wk low as MD & CEO Rakesh Khanna resigns

Shares of Orient Electric dipped 5 per cent to Rs 256.30 on the BSE in Monday's intra-day trade as Rakesh Khanna is set to step down from the post of Managing Director & Chief Executive Officer (MD & CEO) from the close of business hours today (April 03, 2023).

The company, however, has announced the appointment of Rajan Gupta as Additional Director and the Managing Director & Chief Executive Officer of the company for a period of 5 years effective from April 4, 2023. The stock of the household appliances company was quoting close to its 52-week low level of Rs 245, touched on December 26, 2022.

Rajan Gupta has an experience of 25 years, and his last role was at Hathaway Cable where he was serving as the MD, CEO, and Chairman of the company.

Orient Electric said Rajan will provide strategic leadership to Orient Electric, driving significant scale and innovation. "He will focus on building the organization through organic and inorganic expansion, setting up cutting edge manufacturing facilities and strengthening the brand. Under Rajan’s stewardship, Orient Electric will continue to enhance customer intimacy, strengthen its robust dealer/distributor ecosystem and significantly expand its revenue base and profitability," the company said. READ FILING HERE

Orient Electric is a part of the diversified CK Birla Group, with strong manufacturing capabilities and presence in over 40 countries. It is a trusted brand for consumer electrical products in India, offering a diverse portfolio of fans, lighting, home appliances and switchgear. In the domestic market, it has penetration up to the small towns with a well-organised distribution network reaching 1,25,000 retail outlets and a strong service network covering more than 450 cities.

For nine months (April to December) of financial year 2022-23 (9MFY23), Orient Electric reported 34.3 per cent year-on-year (YoY) drop in its profit after tax at Rs 51 crore. Earnings before interest, taxes, depreciation, and amortization (ebitda) was down 30.6 per cent YoY at Rs 105 crore, while margin contracted 330 bps to 5.6 per cent, due to increased investment in growth driving the costs. Sales, however, rose 10.4 per cent YoY at Rs 1,871 crore.

he fast moving electric goods (FMEG) companies witnessed weak rural demand amid high inflations, slow inventory build-up of winter related home appliances.