Voltas shares drop 2% as Motilal Oswal downgrades stock amid weak demand
Voltas Ltd shares declined 2% in early trade after Motilal Oswal Financial Services downgraded the stock from a 'Buy' to 'Neutral' rating, citing soft demand in the Room Air Conditioner (RAC) segment. The brokerage also slashed its target price from ₹1,600 to ₹1,350, indicating a limited upside of just 4% from current levels.
According to the report, Voltas witnessed a significant 20–25% year-on-year drop in RAC volumes during April and May 2025. The decline was attributed to a delayed summer and erratic rainfall patterns across key markets. While June has seen a slight recovery—especially in North India—it hasn't been sufficient to make up for the earlier volume loss.
Motilal Oswal has revised its revenue estimates for the Unitary Cooling Products (UCP) segment downward by nearly 14% for FY26 and FY27. Additionally, EBITDA margin expectations have been reduced by 80bps and 40bps respectively, while EPS projections were cut by 17% for FY26 and 14% for FY27.
Despite underperformance in the commercial AC and refrigeration segments, Voltas' joint venture, VoltBek, remains a bright spot. The JV recorded a 57% YoY volume growth and gained market share across categories. It also aims to achieve EBITDA break-even by FY26.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.
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Aman Shukla is a post-graduate in mass communication . A media enthusiast who has a strong hold on communication ,content writing and copy writing. Aman is currently working as journalist at BusinessUpturn.com
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