Buy Voltas; target of Rs 1650: Motilal Oswal

Motilal Oswal is bullish on Voltas has recommended buy rating on the stock with a target price of Rs 1650 in its research report dated April 24, 2024.

Broker Research

April 25, 2024 / 11:56 IST

Buy

26 Aug, 2025 12:21

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Motilal Oswal's research report on Voltas

Voltas (VOLT) stock has appreciated by 50%+ in the last six months and has performed well since the reinitiation of coverage in Sep’23. Interactions with dealers in a few regions indicate that there has been an increase in demand for cooling products in Mar & Apr’24. Industry estimates indicate that the demand for RAC has increased by over 30% during the period. VOLT indicated that its volume growth in RAC stood at 71% YoY in 4QFY24 and we believe that the company recently gained market share after the declines seen in the last 1.5 years. As per our estimate, market share of the company should be at ~22% in FY24.We believe that RAC is a long-term structural story, given the low penetration level in India, rising income levels, and thus, aspiration of middle-income group people and rising heatwaves across the globe. We expect the company to maintain its market share at ~22% in FY25/26 and expect the RAC industry to register a CAGR of 15% over FY24-26.

Outlook

We maintain BUY on the stock with a revised price target of INR1,650 (vs. INR1,410 earlier) based on 50x FY26E EPS for the UCP segment, 35x FY26E EPS for PES and EMPS segments and INR38/share for Voltbek.

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