Voltas Ltd. share price target

Key highlights: Revenue growth was largely driven by the UCP segment (65% of sales), whererevenuesgrew29%yoywhileMEPsegmentrevenues(31%ofsales)grewmodestly by 3% yoy. EBITDA grew 52% yoy to Rs 2bn and EBITDA margins expanded by 235bps to 10.8% (vs. our estimate of 9.3%). Margin expansion was evenly aided by gross margin expansion (100bps) and operating leverage. Segmentally, UCP segment drove the margin surprise(itsmarginsexpandedby263bpsyoyto14.9%,240bpshigherthanourestimate), whileMEPmarginswereat1.9%(up35bpsyoy,marginallybelowourestimateof2.5%). UCPmarginsbenefitedfromoperatingleverageonstrongvolumegrowth(29%yoy)inroom...

ICICI Securities Ltd | Retail Equity Research Voltas' Q1FY17 results were ahead of our estimates with net profit increasing 39% YoY to ~| 158 crore largely due to an improvement in EBITDA margin by 236 bps YoY and higher other income Consolidated revenues grew ~19% YoY to | 1855 crore mainly due to an increase in revenue from the UCP segment by ~29% YoY led by low base and revival in demand due to intense summer in AprilMay 2016. EMPS segment revenue recorded 3% YoY growth driven by a pick-up in execution of new international projects...

1QFY17 performance exceeds expectations: Voltas' (VOLT) 1QFY17 revenues grew 19% YoY to INR18.5b (v/s our estimate of INR19.4b) and EBIDTA increased 52% YoY to INR2.0b (higher than our estimate of INR1.7b). EBITDA margin came in at 10.8% (+240bp YoY), ahead of our estimate of 8.7%. Adj. net profit stood at INR1.6b, up 53% YoY and higher than our estimate of INR1.2b. Unitary Cooling Products (UCP) segment's sales were up 29% YoY to INR11.9b in 1QFY17, aided by strong summer-led consumer demand. VOLT continued to be the market leader with a share of 22%. For the quarter, air cooler sales...

In room air-conditioners Voltas will strategically position itself to retain its market share in summer of 2016. Early onset of summer helped the industry. Price cut and higher sales incentives continue to characterize the market given higher inventory levels in the channel.

Voltas reported a strong set of numbers for 4QFY2016. The top-line at Rs1,876cr is up 26.4% yoy and is higher than our expectation, mainly driven by strong execution across the EMP segment. The EMP segment impressed us with a 36.5% yoy increase in revenue to Rs819cr (accounting for 44% of the company's overall 4QFY2016 revenues), whereas ..

ICICI Securities Ltd | Retail Equity Research Voltas' Q4FY16 results were ahead of our estimates with net profit increasing 49.5% YoY to | 176 crore (vs. I-direct estimate: | 134...

4QFY16 performance surpasses expectations: Voltas' revenue grew by a strong 27% YoY to INR18.9b (vs. our estimate of INR17.0b) and EBIDTA was up 29.5% YoY to INR1.9b (higher than our estimate of INR1.5b) in 4QFY16. EBITDA...

Voltas has a dominant presence in the cooling solutions segment that has helped to grow its consolidated revenues by 8.1% in 9MFY16. Considering the strong performance of the cooling products business and likely recovery in the EMP segment, we expect that stock will perform better in the near future.

Voltas 3QFY16 APAT at Rs 542mn was below our estimate of Rs 623mn. The EMP (electro mechanical projects) segment reported an EBIT loss of Rs 86mn and EPS (engineering products and services) had lower-than-expected EBIT margin of 22.1% (-690bps YoY).

ICICI Securities Ltd | Retail Equity Research Voltas' Q3FY16 results were below our estimates with net profit down 49.5% YoY to | 54.2 crore (vs. I-direct estimate: | 72 crore)...