Havells India shares in focus after Q1 profit drops 14% YoY. Should you book profits?
Havells India
are expected to remain in focus on Tuesday after the company reported a 14% year-on-year (YoY) decline in standalone net profit for the first quarter ended June.
The company posted a net profit of Rs 352 crore for Q1FY26, down from the same period last year, as weak summer conditions and sluggish demand impacted its cooling products segment.
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Havells reported a 6% YoY decline in net sales to Rs 5,438 crore, attributing the performance drop to subdued sales of air-conditioners, fans, and air coolers.
Chairman and Managing Director Anil Rai Gupta said during the earnings call that high channel inventory for air-conditioners will take 1–2 quarters to clear, prompting the company to adjust production levels accordingly.
The large appliances business under the Lloyd brand saw sales fall 34% YoY to Rs 1,262 crore, while the lighting and fixtures segment declined marginally to Rs 374 crore. The electrical consumer durables segment also reported a 14% YoY drop in revenue to Rs 906 crore.
In contrast, the switchgears business grew 9% YoY to Rs 630 crore, and the cables segment reported strong 27% YoY growth to Rs 1,933 crore, partially offsetting weakness in other verticals.
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Brokerage commentary post Q1 results
Motilal Oswal | Neutral | Target: Rs 1,680
Motilal Oswal (MOSL) maintained a 'Neutral' rating on Havells India and reduced its target price to Rs 1,680 from Rs 1,710, citing a weaker-than-expected performance led by the Lloyd, electrical consumer durables (ECD), and lighting segments. MOSL highlighted a 6% YoY decline in revenue to Rs 5,460 crore, a 10% YoY drop in EBITDA to Rs 520 crore, and an EBITDA margin contraction of 40 basis points to 9.5%.
PAT declined 15% YoY to Rs 350 crore, coming in 11% below MOSL's estimates. The brokerage attributed the weakness to soft demand caused by a muted summer, which hurt cooling product sales. However, it noted that the cables and switchgears (C&W) segment remained strong due to infrastructure and industrial demand. MOSL cut its FY26/FY27 EPS estimates by ~8% and 7%, respectively, but expects a recovery ahead.
Antique Broking | Buy | Target: Rs 1,797
Antique Broking maintained its 'Buy' rating but lowered its target price to Rs 1,797 from Rs 1,859 after the Q1FY26 operational performance missed expectations. The brokerage attributed the underperformance to weakness in the Lloyd and ECD segments and revised its FY26 and FY27 earnings estimates down by 6% and 10%, respectively.
On Monday, shares of Havells India closed flat at Rs 1,532.05 on BSE.
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