Neutral Havells India; target of Rs 1710: Motilal Oswal

Neutral

Motilal Oswal's research report on Havells India

Havells India (HAVL)’s 4QFY25 revenue grew 20% YoY to INR65.4b (5% beat), led by better-than-expected growth in the Lloyd/C&W segments. Higher margins in the Lloyd and ECD segments have resulted in ~19% YoY EBITDA growth to INR7.6b (+17% vs. our est.). OPM stood at 11.6% (flat YoY) vs. our est. of 10.4%. PAT grew ~16% YoY to INR5.2b (15% above our est.) Management highlighted that the large appliances and cables fueled revenue growth. The ramp-up of new capacity in the C&W segment is underway. HAVL’s margin would reach a normalized level (ex-Lloyd) of 13.5- 14.0%, as the benefits of operating leverage kick in. Delayed summer has affected secondary demand in the ongoing season and the growth trajectory in rest of the season needs to be seen.

Outlook

We marginally increase our EPS estimates by ~3% each for FY26/FY27 as we raise our margin assumption for the Lloyd segment by 150-200bp. HAVL’s valuations at 60x/49x FY26/27E EPS remain expensive. We reiterate our Neutral rating with a revised TP of INR 1,710 (based on 50x FY27E EPS).

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Havells India - 23042025 - moti