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 10:10 a.m.