22 January 2019 Havells weak operating performance in 3QFY20, led by 10% overall revenue decline, has led to the third consecutive quarter of cut in earnings estimates. While the base is favorable, Havells should regain double-digit growth in FY21, if improvement in the liquidity scenario for overall consumption revival is supportive. Overall, revenues declined 9.9% YoY to INR22.7b (v/s 14% below est.). Revenue miss was largely due to weakness in Havells core portfolio (i.e. ex- Lloyd business), which declined 9%. This can be attributable to (a) weak consumer sentiment, (b) economic slowdown, (c) weak industrial demand due to muted capex, (d) dealer de-stocking on liquidity crunch, and (e) high base of last year (3QFY19 revenue growth was 29% in core portfolio). Lloyds revenue was down 15.9% YoY to INR3b. In the AC business, the company has witnessed low double-digit growth, a key positive after dull performance in the last summer season.