CG Consumer Electricals shares dive 13% to hit one-year low after CEO resigns; co appoints Promeet Ghosh as new chief

Shares of Crompton Greaves Consumer Electricals Ltd (CG Consumer Electricals) fell sharply in Tuesday's trade after the company's Chief Executive Officer (CEO) Mathew Job quit to pursue other career interests. Job has tendered his resignation from the position of Executive Director on the board with effect from April 24, 2023, and has also resigned as the company's CEO, CG Consumer Electricals stated. April 30 would be his last day in office, it added.

The stock cracked 13.20 per cent to hit a day low -- also its 52-week low -- of Rs 255.50 over its previous close of Rs 294.35. The counter has lost 25.28 per cent so far in 2023 and 30.70 per cent in a year.

CG Consumer said it has appointed Promeet Ghosh as the Managing Director and CEO, reporting to the board, for a period of five years. He has been appointed as an Executive Director on the Board with effect from April 24, 2023, and would assume charge as the Managing Director and CEO from May 1, 2023, until April 30, 2028.

The company also elevated Shantanu Khosla as the Executive Vice-Chairman of the board for a one-year period from May 1, 2023, to April 30, 2024. After completion of the mentioned period, he would assume the position of non-Executive Vice-Chairman till December 31, 2025.

On the technical front, CG Consumer was last seen trading lower than the 5-day, 20-, 50-, 100- and 200-day moving averages. The counter's 14-day relative strength index (RSI) came at 24.09. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 35.63. It has a price-to-book (P/B) value of 7.17.

That said, CG Consumer has an average target price of Rs 430, Trendlyne data showed, suggesting a potential upside of 65.19 per cent. The scrip has a one-year beta of 0.62, indicating low volatility.

"In the last 18 months, the counter has been in free fall mode and corrected almost 50 per cent. At the current juncture, it is trading below all key moving averages. So, fresh longs are not advised as we expect a downside level of 230 in the near term," said Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers.

Support on the counter could be seen at Rs 259. "Crompton Greaves is very oversold on the daily charts and now has support at Rs 259. A daily close below this support could lead to a target of Rs 232 in the near term. Strong resistance will be at Rs 280. A close above this resistance could be used to buy for better returns in the coming weeks," said AR Ramachandran from Tips2trades.

Meanwhile, Indian equity benchmarks slipped into the red in early trade today, taking cues from lower Asian markets. The domestic indices marginally declined as losses in consumer durables, pharma and technology stocks countered gains in metals, state-owned lenders and energy shares.

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