Voltas Q4 net may fall 9.4%, order flow & tax rate to hurt

Voltas is expected to report net profit at Rs 91 crore, down 9.4 percent in the qaurter ended March 2015 from Rs 100.4 crore in year-ago period. Adjusted net profit is seen up 8.8 percent at Rs 91 crore versus Rs 83.6 crore in year-ago period, according to a CNBC-TV18 poll. Total income, during the quarter, is seen marginally down 0.8 percent at Rs 1,451 crore compared to Rs 1,463 crore (Y-o-Y). The company will announce Q4 results on May 22.

Analysts polled by CNBC-TV18 estimate EBITDA to be up 10.2 percent at Rs 116 crore in Q4FY15 from Rs 105.4 crore on yearly basis. Operating profit margins (OPMs) is seen up 80 basis points at 8 percent versus 7.2 percent (Y-o-Y).

Analysts expect Voltas to register flattish topline growth despite robust growth for its Unitary Cooling products (UCP) segment mainly dragged by continuation of a annual decline in its Electro-mechanical projects (MEP) segment’s sales. This may be dented further by weak order flow growth in the past and execution issues being faced at certain projects. There may be continued decline (annual) in Engineering Products (EPS) segment as demand for construction and mining equipments remain weak.

However, UCP division will continue its strong show as dealer checks suggest strong room AC industry revenue growth of 18-20 percent Y-o-Y.