India's Crompton Greaves drops on earnings worries

* Shares in Crompton Greaves Ltd drop as much as 11
percent after the power equipment makers said on Friday net
profit dropped 64 percent in the July-September quarter.
 
* Citigroup downgrades the stock to 'neutral' from 'buy' saying
earnings were lower than expected due to losses related to the
ongoing transfer of production from Belgium to Hungary, and
lower margins in its consumer business.
* Citigroup also cuts the target price to 129 rupees from 152
rupees, saying Crompton Greaves' cut in fiscal 2013 guidance
hinted at a "bumpy" couple of quarters ahead.
* "We now believe margin recovery will likely take longer than
previously expected and that CG will remain range bound unless
management starts delivering on its stated targets," Citigroup
says in a note dated on Monday.
* Crompton Greaves shares down 8.5 percent at 112.35 rupees as
of 0440 GMT.

Posted in: MARKET EYE