Havells India Share Hold

by Anand Rathi

Havells India  In consolidation mode; Hold. 

Havells India clocked (standalone) 3QFY15 revenue of Rs. 1250 crore(up 5% year on year), but 7% below our estimated Rs. 1350 Crore.

Despite a correction in commodity prices, Havells did well to hold on to operational profitability. Consolidating its inventory in the channels, its domestic sales would grow at a slower clip.

We believe that by adopting a cautious approach to channel stocking, the company is very prudently averting a risk to its balance sheet from volatile copper prices. At the ruling market price of Rs. 264, the stock trades at earnings and EV / EBIDTA multiples of respectively 24x and 12.4x, discounting our FY17e figures.

With valuations mirroring those of FMCG companies, we believe that the companys ability to absorb any shocks on the earnings and cash-flow fronts is minuscule. Hence, we have maintained our Hold recommendation, with a price objective of Rs 243.

For full report click on the links below:

Havells India  -           Click here to accessthe report

For more details

Vidhi Mehta

vidhimehta@rathi.com

Assistant Manager - Wealth Management

Mobile: +91 99203 16932

Anand Rathi

11th Floor, Times Tower, Kamla City,

Senapati Bapat Marg Lower Parel,

Mumbai - 400 013.  India 

Tele No: +91 022 4047 7000, Direct:  +91 022 4001 7168, Fax No: +91 022 4047 7070  Website: www.rathi.com

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