Havells India Shares Rise Nearly 4% After Q3 Results; Check Key Numbers, Outlook, And Dividend Payout

Havells India shares rise nearly 4% after Q3 results; check key numbers, outlook, and dividend payout

Havells India Q3 FY25 Results: Key Highlights, Stock Performance, and Future Outlook

Havells India Ltd, a leading player in the consumer electrical goods sector, announced its financial results for the third quarter ended December 31, 2024 (Q3 FY25). Following the announcement, the company’s shares saw an uptick, rising nearly 4% to an intraday high of ₹1,616.25 on the NSE on January 17, 2025. This positive movement reflects the market’s reaction to Havells’ stable revenue growth and strategic initiatives, despite a marginal decline in net profit.


Key Financial Numbers

  1. Net Profit Decline
    Havells India reported a consolidated net profit of ₹277.96 crore for Q3 FY25, marking a 3.45% year-on-year (YoY) decline from ₹287.91 crore in Q3 FY24. The decline in profit is attributed to increased expenses and commodity price fluctuations that affected the company’s wire segment.
  2. Revenue Growth
    Revenue from operations rose by 10.76% YoY to ₹4,888.98 crore compared to ₹4,413.86 crore in the corresponding quarter last fiscal. This growth was driven by healthy demand across consumer, industrial, and infrastructure segments, which partially offset challenges in the wires business.
  3. Total Income and Expenses
    Total income, including other income, stood at ₹4,953.31 crore, a 10.81% increase from the year-ago period. Total expenses surged by 12.18% to ₹4,575.97 crore in Q3 FY25, reflecting higher input costs and operating expenses.
  4. Dividend Declaration
    The board of directors declared an interim dividend of 400%, equivalent to ₹4 per equity share with a face value of ₹1 each. This payout highlights Havells’ commitment to rewarding its shareholders.

Segment Performance

  1. Consumer and Industrial Segments
    Havells’ consumer and industrial segments performed well, with robust demand driving growth. The company reported steady sales of electrical products, lighting solutions, and appliances, contributing significantly to its top line.
  2. Wire Segment Challenges
    The wires segment faced headwinds due to commodity price volatility, which led to moderate revenue growth in this category. Chairman and Managing Director Anil Rai Gupta acknowledged this impact but expressed optimism for recovery in the upcoming quarters.
  3. Infrastructure Growth
    Infrastructure-related products also saw increased demand, supported by ongoing government projects and private investments in urban development.

Stock Performance and Market Reaction

Following the Q3 FY25 results announcement, Havells India’s stock witnessed a positive reaction from investors. Shares surged 3.7% to ₹1,616.25 during intraday trade on January 17, before stabilizing at ₹1,580, reflecting a 1.40% gain for the day.

  1. 12-Month Performance
    Over the past 12 months, Havells India shares have gained over 7%, outperforming several peers in the consumer electrical segment. This reflects investor confidence in the company’s consistent revenue growth and strategic expansion plans.
  2. Investor Sentiment
    Despite a dip in net profit, robust revenue growth, improved dividend payouts, and the announcement of a new manufacturing facility have boosted investor sentiment. Analysts view the stock as a strong long-term bet, given its market leadership and focus on innovation.

Strategic Investments and Future Plans

  1. New Refrigerator Manufacturing Facility
    In November 2024, Havells India announced plans to invest ₹480 crore in setting up a refrigerator manufacturing facility in Ghiloth, Rajasthan. This initiative is aimed at backward integration and achieving economies of scale, enhancing the company’s competitive edge in the appliances market.
    • Proposed Capacity: 14 lakh units per annum
    • Investment Funding: Through internal accruals
    • Expected Completion: By Q2 FY27
    The facility aligns with Havells’ strategy to expand its product portfolio and cater to the growing demand for premium home appliances in India.
  2. Focus on Sustainability and Innovation
    Havells continues to invest in sustainable and innovative solutions, particularly in energy-efficient products. This focus aligns with the evolving preferences of environmentally conscious consumers and positions the company as a leader in green technology.

Management Commentary and Outlook

Anil Rai Gupta, Chairman and Managing Director of Havells India, expressed optimism for the upcoming quarters. He stated:

“Havells consumer, industrial, and infrastructure segments delivered healthy performance, although commodity fluctuations impacted wire growth, resulting in moderate overall revenue growth. We remain positive on better demand and margin scenarios in forthcoming quarters.”

The company is optimistic about improving margins as commodity prices stabilize and operational efficiencies are realized. A robust demand outlook across urban and rural markets further supports Havells’ growth trajectory.


Impact on Stock Market and Sector

  1. Sector Influence
    Havells India’s performance serves as a bellwether for the consumer electricals sector. Its revenue growth amidst challenging market conditions indicates resilient demand, which bodes well for the broader industry.
  2. Indices Contribution
    Havells India’s weightage in benchmark indices like Nifty 50 means its performance has a direct impact on market indices. Positive quarterly results could contribute to sectoral and index-level gains.
  3. Competitor Comparison
    Havells’ results will likely lead to a reassessment of peers like Bajaj Electricals, Crompton Greaves, and V-Guard Industries. Investors are expected to compare growth trajectories and strategic investments across these companies.

Challenges and Risks

  1. Commodity Price Volatility
    Continued fluctuations in raw material costs could pressure margins, particularly in the wires segment. Effective supply chain management will be crucial in mitigating this risk.
  2. Market Competition
    The consumer electrical goods market remains highly competitive, with both domestic and international players vying for market share. Havells will need to maintain its innovation edge to stay ahead.
  3. Economic Uncertainty
    Macroeconomic factors such as inflation and currency fluctuations could impact consumer spending and export revenues, posing a potential challenge.

Conclusion

Havells India’s Q3 FY25 results showcase the company’s resilience and growth potential. Despite challenges in the wires segment, strong revenue growth across consumer, industrial, and infrastructure products highlights its diversified business model. Strategic investments, such as the upcoming refrigerator manufacturing facility, position Havells for long-term success.

For investors, Havells India remains an attractive prospect, driven by its leadership in the consumer electricals space, focus on sustainability, and shareholder-friendly policies. The company’s outlook for improving margins and demand in the coming quarters further strengthens its investment appeal.

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