Hold Havells India; target of Rs 259: ICICIdirect

  ICICIdirect.com's report on Havells India
Havells India’s (HIL) performance was muted in Q1FY16 with standalone revenue posting a decline of ~1% YoY due to the poor performance of industrial products category. Slackness in industrial activity hit revenue growth of the cable, switchgear and lighting segments to the tune of 4%, 3% and ~2% YoY, respectively. However, the electrical consumer durable (ECD) segment recorded sales growth of ~9% YoY driven by water heater and fan segment

A decline in sales of industrial products coupled with higher employee expenses and foreign exchange loss took a toll on EBITDA margin to the tune of ~21 bps YoY during Q1FY16

A lower EBITDA margin coupled with higher depreciation charges negated the impact of higher other income as net profit remained flat on a YoY basis at ~Rs 107 crore during Q1FY16

The performance of Sylvania remained under pressure in Q1FY16 as revenues declined ~4% YoY to ~€103 million while it reported an operating loss of €0.2 million after providing €3.6 million restructuring cost during Q1FY16. It recorded a loss of €4.4 million against net profit of €0.3 million during Q1FY15

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