Havells Q4 earnings beat estimates, stock at record high; where is it headed?

Shares of Havells are in focus after the electrical goods maker reported Q4 earnings that beat estimates.

Havells stock is expected to reach a price target of Rs 1785 in two months, according to HDFC Securities. One can fix a stop loss of Rs 1,460. On Tuesday, Havells stock ended 1.01% to Rs 1661.55 against the previous close of Rs 1645 on BSE. Market cap of the firm rose to Rs 1.04 lakh crore. The stock hit a record high of Rs 1,688 in the same session. The earnings were announced after market hours.

Havells India clocked a 24% rise in Q4 net profit to Rs 446.7 crore against Rs 358 crore in the March 2023 quarter. Revenue climbed 12% to Rs 5,434 crore in the last quarter against Rs 4,850 crore in the corresponding quarter of he previous fiscal.

The Board of Directors decided to recommend a final dividend at Rs 6 per equity share.

EBITDA rose 20% to Rs 637 crore in Q4 against Rs 531 crore in Q4 of FY23.  

Nuvama has assigned a hold rating with a target price of Rs 1605 post Q4 earnings.

“Havells beat our/consensus Q4FY24 earnings estimates led by higher-than-anticipated EBIT margins resulting in an outperformance in PAT. It is poised for growth with capacity addition in C&W, margin accretion at Lloyd while its balanced B2B and B2C focus makes this quarter an inflection point for Havells. We are upgrading FY26 EPS estimates; retain ‘HOLD’ with TP of Rs 1,605 (earlier Rs 1,376),” said Nuvama.

Praveen Sahay, Research Analyst - Institutional Equities at Prabhudas Lilladher said results of Havells came above estimates and Lloyd saw a breakeven. He has an accumulate rating on the stock. The stock currently trades at 61x/46x FY25E/FY26 estimates earnings.

Lloyd revenues grew by 5.4% YoY to Rs13.4 billion. Lloyd 2Y growth at 18.2% CAGR which is a positive start for summer products as per management. EBIT stood at Rs 372 million, post positive EBIT after 10 quarters.”