Crompton Greaves board has approved the demerger of its consumer products business unit into a separate listed company.

Commenting on the same HDFC Securities said, "Based on current trading multiples for comparable consumer companies, we believe that from CMP, upsides are limited.

Even after assuming 25x FY16E valuation for consumer business and optimistic recovery assumptions for the overseas power business, the ex-consumer business is trading at 15x FY16E on CMP.

Also demerger will reduce the cash generating ability of remaining business as consumer segment has been the highest cash generator. We maintain our estimates but increase our target price to Rs 184 share (from 150), based on 17x FY16E EPS."

Disclaimer: IRIS has taken due care and caution in compilation of data for its web site. Information has been obtained by IRIS from sources which it considers reliable. However, IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website.