The 38 reports from 10 analysts offering long term price targets for Voltas Ltd. have an average target of 645.78. The consensus estimate represents an upside of 11.70% from the last price of 578.15.
|Summary||Date||Stock||Broker||Price at Reco.||Target||Price at reco|
Change since reco(%)
|2019-06-20||Voltas Ltd.||ICICI Securities Limited||622.25||645.00||622.25 (-7.09%)||Target met||Hold|
ICICI Securities Limited
The electromechanical projects & services (EMPS) segment is likely to record flattish growth in the near term owing to bidding of quality orders. Voltas expect a significant rise in government expenditure on infrastructure (metros, airports), smart cities, cleaner water, healthcare and educational institutions that are expected to increase opportunities in the projects segment. Hence, it is likely to focus more on domestic projects compared to overseas. With order execution cycle of one to one and a half years, the current order book of ~ | 5000 crore indicates revenue visibility in the next...
|2019-06-20||Voltas Ltd.||Nirmal Bang Institutional||622.25||615.00||622.25 (-7.09%)||Target met||Accumulate|
Nirmal Bang Institutional
We met the management of Voltas to get the latest business updates. Key highlights of our interaction were as follows The air-conditioners (AC) sales were robust in April and May 2019 owing to a hot summer season, while the longterm sustainable EBIT margin profile is 11%. The Voltas-Beko JV is likely to remain in the investment phase over the next three to four years. The JV is likely to enhance its product portfolio gradually with Sanand (Gujarat) manufacturing plant commencing towards the end of CY19. Currently, it is expanding distribution network through multi-brand outlets as well as exclusive brand outlets via franchisee route. The EMPS project segment is likely to witness...
|2019-06-19||Voltas Ltd.||Motilal Oswal||608.00||595.00||608.00 (-4.91%)||Target met||Neutral|
UCP margins to stabilize at 11-12%, earmarks INR5b capex for new facility We met management of Voltas (VOLT) to understand the industry trends and the company's progress in its various segments and projects. Key takeaways: Room AC (RAC) industry witnesses a strong start to FY20: After remaining weak over the last two years, RAC industry demand picked up strongly in April/May this year, helping VOLT to normalize inventory in the system. Demand was strong across regions (north, south and west) over the last two...
|2019-05-13||Voltas Ltd.||HDFC Securities||570.05||658.00||570.05 (1.42%)||Target met||Buy|
In an otherwise dull FY19, Voltas maintained industry leading RAC margins and still gained market share (23.9% Feb YTD vs. 22.1% YoY). This validates the co's focus on the mass-premium segment and deep distribution, unlike premium hunting peers. Low RAC penetration, higher incomes and rising cultural affinity for cooling in India drive our long-term structural stance on Voltas, a clear and persistent industry leader. Additionally, entry in other categories (via the Volt-Beko JV) only bolsters the multi-year growth story at Voltas. Voltass 4Q missed estimates, with high RAC channel inventory, an extended winter and weak UCP/EMPS segment margins. We cut EPS estimates by ~4% over FY19-21E to factor the miss in 4Q and moderation in order book growth in project business. Retail offtake of RACs has improved in Apr/May-19 driven by a hot start to summer. FY20 should see healthy volume growth for RACs after a tough FY19. Our SOTP for Voltas values EMPS/EPS/UCP at 17/20/35x Mar-21E EPS and Volt-Beko at 1x P/S, translating to a TP of Rs 658. Future growth drivers are intact. Maintain BUY.
|2019-05-13||Voltas Ltd.||Dolat Capital||570.05||690.00||570.05 (1.42%)||19.35||Buy|
Weak Q4: FY20 appears more sanguine; Maintain Buy Q4 was a weak quarter in both RAC and projects business. We believe FY20 should be a normal year on the back of Q1FY20, which is expected to be good on the back of good summer- a fact corroborated by competitors and channel checks. While project business suffered due to quarterly quirks, it was decent on a FY basis. With FY20 expected to be normal, we expect balance sheet, currently expanded due to working capital, to improve as well. We continue to like the structural penetration story of ACs and...
|2019-05-13||Voltas Ltd.||Reliance Securities||570.05||570.05 (1.42%)|
|2019-05-13||Voltas Ltd.||ICICI Securities Limited||570.05||605.00||570.05 (1.42%)||Target met||Hold|
ICICI Securities Limited
Voltas' EMPS segment revenue growth at ~12% YoY (owing to fast execution of domestic and international orders) was partly offset by ~6% drop in revenue of each UCP and EPS segments, respectively. Lower volume growth in UCP segments in Q4FY19 can be attributable to extended winter and focus on rationalisation of inventory at dealer's level. However, we believe FY20E will be better than FY19 for the UCP segment considering demand revival of air conditioners (April/May 2019 saw strong demand of cooling products). We model UCP segment revenue CAGR of ~18% in FY1921E led by ~14% volume growth during the same period. We believe strong...
|2019-05-13||Voltas Ltd.||Nirmal Bang Institutional||570.05||615.00||570.05 (1.42%)||Target met||Accumulate|
Nirmal Bang Institutional
EMPS Stays Healthy; Delayed Summer Dents UCP Margins ACCUMULATE Voltas posted a weak performance in 4QFY19 with its consolidated revenues flat at Rs20.6bn, 5%/7% below our/consensus estimate, respectively. While EMPS segment's revenues grew 11.7% YoY to Rs9.8bn owing to a healthy order book, unitary cooling product (UCP) segment's performance was weak owing to delayed onset of the summer season and higher inventory in the trade channel. UCP segment's sales fell 6% YoY to Rs10bn in 4QFY19 and 2% YoY at Rs31.5bn in FY19, while the industry declined 3% YoY. The profitability was impacted as EBIT margin of EMPS segment fell 310bps YoY to 4.5% while UCP segment's margin declined sharply by 680bps YoY to...
|2019-05-11||Voltas Ltd.||Motilal Oswal||574.10||595.00||574.10 (0.71%)||Target met||Neutral|
issue. PAT declined 28% to INR1.4b (21% miss). UCP margin guidance of 11% suggests competitive pressure: Management guided for a sustainable UCP margin of 11% versus 13-14% over FY15-18. In our view, high competitive intensity is restricting price hike actions, as VOLT looks to secure its leadership position (market share expanded to 23.9% v/s 22.1% last year). Capital employed in the segment increased to INR5.6b from INR2.5b in 4QFY18 on account of higher inventory in the system. Inventory has now been liquidated and primary sales have seen revival in 1QFY20....
|2019-05-10||Voltas Ltd.||Prabhudas Lilladhar||574.10||584.00||574.10 (0.71%)||Target met||Hold|
We are downgrading our rating from Accumulate to Hold following 16.5% and 4.6% cut in FY20 & FY21 EPS on account of 1) estimate loss of Rs750mn and Rs600mn in FY20 and FY21 due to increased spends on brand building and distribution in Voltas-Beko JV to establish itself in highly competitive white goods market 2) low growth of EMPS in FY20 due to poor order inflow and 3) limited pricing power in RAC market due to rising competition Voltas is focusing on consolidating its leadership (YTD market share gain of 180bps to 23.9%) and look at margin expansion mainly through cost...
|2019-03-19||Voltas Ltd.||ICICI Securities Limited||612.80||650.00||612.80 (-5.65%)||Target met||Hold|
ICICI Securities Limited
Voltas' UCP division performance remained flat in 9MFY19 owing to bad weather, subdued festive demand and a poor second summer. The overall RAC industry de-grew ~4% YoY in 9MFY19. Despite such challenging conditions, Voltas has maintained its leadership position with market share of 24%. With normal inventory of ACs at dealers level (1-1.5 months) and slight demand revival in southern regions, the management expects strong AC volume growth in FY20E. This along with rising contribution of inverter AC sales (inverter AC now contributes ~40% of...
|2019-03-13||Voltas Ltd.||Motilal Oswal||621.00||590.00||621.00 (-6.90%)||Target met||Neutral|
13 March 2019 Capital Goods AC industry to register double-digit growth in FY20 on back of a pick-up in demand in certain pockets of the country. VOLT expects volumes to increase in March- April (post the festive season of Holi). Inventory levels have started to recede and primary channel filling has increased. The new facility will come up in phases with the INR5b capex spread over the next five years; annual capex will be in the range of INR1b. VOLT expects the factory to start in 2H 2020. margins to settle around 11-12% on sustainable basis, despite its inability to take price hikes given the subdued demand, INR depreciation and increase in competition, raw material cost, and import duty on compressors and completely built units (CBUs). EBIT margins for 9MFY19 for the UCP segment stood at 9.1%. 4Q margins for VOLT over the last five years stood at an average of 16.9%.
|2019-02-18||Voltas Ltd.||HDFC Securities||520.05||650.00||520.05 (11.17%)||Target met||Buy|
We value Voltas based on SOTP, valuing EMPS/EPS/UCP at Dec-20 P/E at 17/20/35x with TP of Rs 650 (Rs 640 earlier). Voltas reported a weak quarter led by muted off-season RAC performance. Net Revenues grew by 9% driven by healthy execution in the project biz (up 16% vs. exp. of 22%). Weak RAC sales (-3% vs. exp. of 5%) was owing to high channel inventory, modest festive season offtake and heavy base (32% in 3QFY18; rating change led pre-buying).
|2019-02-18||Voltas Ltd.||ICICI Securities Limited||520.05||570.00||520.05 (11.17%)||Target met||Hold|
ICICI Securities Limited
ICICI Securities Ltd | Retail Equity Research Topline growth of ~9% YoY was largely impacted by the UCP division where segment revenue declined ~3% YoY. The tepid performance was led by poor festive demand and failure of second summer. However, the project (EMPS) and product (EPS) segment recorded revenue growth of 16% and 21% YoY, respectively, owing to efficient execution of quality orders UCP segment EBIT margin was down ~450 bps YoY to 8.5% due to...
|2019-02-18||Voltas Ltd.||Reliance Securities||520.05||520.05 (11.17%)|
|2019-02-18||Voltas Ltd.||Nirmal Bang Institutional||520.05||625.00||520.05 (11.17%)||Target met||Buy|
Nirmal Bang Institutional
EMPS Outperforms; UCP Stays Modest In An Unseasonal Quarter BUY Voltas reported consolidated revenues of Rs14.9bn for 3QFY19, up 9% YoY and 5% above our estimate. The top-line growth was driven by EMPS segment with its revenues rising 16% YoY to Rs8.7bn, while EBIT margin rose 80bps YoY to 7.9%. Unitary cooling product (UCP) segment's performance was modest as 3Q is an unseasonal quarter (winter) while the summer season during 1HFY19 was weak. UCP sales fell 3% YoY to Rs5.2bn in 3QFY19 and were flat YoY at Rs21.6bn in 9MFY19, while the industry declined 4% YoY. EBIT margin was down 450bps YoY at 8.5% in 3QFY19 and 320bps YoY at 10.3% in 9MFY19 owing to lower sales, rise in input costs, INR depreciation and...
|2019-02-15||Voltas Ltd.||Motilal Oswal||521.05||535.00||521.05 (10.96%)||Target met||Neutral|
15 February 2019 Sales grew 9% YoY to INR14.8b, marginally below our estimate of INR15.4b, impacted by lower EMP sales (INR8.7b v/s our estimate of INR9.2b). EBITDA declined 3% YoY to INR1.2b estimate of 8.2% due to weak UCP margins. Adj. PAT declined 8% YoY to INR0.9b, below our estimate of INR1b. VOLT booked a loss of INR308m pertaining to its JV business with BEKO. declined 3% YoY to INR5.2b (in-line). The segmental margin shrank 450bp take price hikes, despite a rise in RM cost and INR depreciation.
|2019-02-15||Voltas Ltd.||Prabhudas Lilladhar||521.05||600.00||521.05 (10.96%)||Target met||Accumulate|
positive, however it needs considerable investment to scale up in highly competitive segment. We estimate 9% PAT CAGR over FY18-21. Retain Accumulate with a target price of Rs600 (28x DecFY21 EPS). Poor summer sales on high closing inventory remains a key risk and can de-rate the stock. Concall Takeaways: 1) RAC industry de-grew 4% in 9MFY19 on account of soft Diwali & poor summer season sales. 2) Current RAC inventory is 2 months, expect it to get normalized by end of Q4 3) Inverter ACs account for 40% of spilt AC sales, which are 80% of AC sales 4) 9MFY19 market share at 24% (200bps increase...
|2019-01-01||Voltas Ltd.||Bonanza||554.60||708.00||554.60 (4.25%)||22.46||Buy|
Voltas being a strong brand in the room air conditioner (RAC) segment has maintained its market leadership position in India despite rising competition and various macro level abruptions such as demonetization and GST implementation. Voltas' Unitary Cooling Products (UCP) segment contributes ~50% to sales and recorded ~12% CAGR in FY12-18. A strong brand coupled with over 6,500 dealers has helped increase its market share in ACs from 14% in FY10 to ~21% in FY18. Product mix has improved towards energy efficientinverter RAC segment as inverter AC currently...
|2018-12-20||Voltas Ltd.||Motilal Oswal||577.95||600.00||577.95 (0.03%)||Target met||Neutral|
Voltas' 1HFY19 room air-conditioner (AC) sales saw muted growth of 6% as aresult of unseasonal rains and hailstorms across North and South India.Although, 3QFY19 sales witnessed a pick-up in the western region due to a rise in temperature, rest of India saw tepid sales given a seasonally weak quarter(3QFY18 was a very strong quarter for the UCP segment on inventory clearance done by VOLT as new Energy norms came into existence from Jan'18).