Neutral Voltas; target of Rs 1390: Motilal Oswal

Motilal Oswal's research report on Voltas

Voltas (VOLT)’s revenue declined ~10% YoY to INR23.5b (in line) in 2QFY26, driven by a 23%/5% dip in UCP/PES segments, while EMPS revenue grew ~10% YoY. EBITDA declined ~57% YoY to INR704m (~33% below our estimates, led by a loss in the UCP segment vs. our estimate of ~3% EBIT margin). Overall, OPM stood at ~3.0%, down 3.2pp YoY (1.7pp below our estimate). PAT declined ~74% YoY to INR343m (~61% below our estimate).

Outlook

We maintain our Neutral rating on the stock with a TP of INR1,390, based on 45x Dec’27E EPS for the UCP segment, 20x Dec’27E EPS for the PES and EMPS segments (each), and INR20/share for Voltbek.