Buy Whirlpool of India; target of Rs 1680: ICICI Securities

ICICI Securities research report on Whirlpool of India

While Whirlpool’s Q1FY24 was muted (as expected), we note three positives (1) Elica has continued to report strong revenue growth (19% YoY) led by strong product portfolio expansion and integration with supply chain of Whirlpool, (2) In our view, Whirlpool’s EBITDA margin has likely bottomed out in H1CY23. With correction in commodity prices, we model gradual recovery in margins ahead and (3) Whirlpool reported 3% volume growth on consolidated basis. Standalone business has likely reported volume decline, in our view. We cut FY24-25E earnings by 9-12% to factor in weak Q1FY24.

Outlook

However, we believe the industry is likely to revive in H2FY24 led by festival buying and favourable base. We model Whirlpool to be beneficiary of revival in industry. Maintain BUY with revised TP of INR 1,680.