ICICI Securities' research report on Voltas
We believe 15% YoY volume growth in a quarter with unfavourable weather conditions indicates early signs of revival in Unitary cooling products segment for Voltas. The company faced dual challenges over past three years such as (1) market share erosion due to steep competitive pressures and (2) reduction in margins due to steep increase in commodity prices. We believe correction in input process could allow Voltas to improve margins and increase more in brand building and distribution investments. Eventually it may allow Voltas to arrest the decline in market shares too. We believe there are early signs of stability emerging in market shares and margins.
Outlook
However, we need more comfort on valuations to be more constructive. Retain HOLD with DCF-based revised TP of INR 810 (36x FY25E).
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