{
  "id": 5802110,
  "title": "Havells holding out for improvements",
  "url": "https://urgent.news/2026/09/05/havells-holding-out-for-improvements",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-09-05T16:42:11.000Z",
  "source": {
    "name": "Hindu BusinessLine",
    "slug": "hindu-businessline",
    "url": "https://www.thehindubusinessline.com/portfolio/stock-fundamental-analysis-india/havells-holding-out-for-improvements/article71423530.ece"
  },
  "original_language": "en",
  "account": "Havells, a diversified consumer durables manufacturer, has reported a pricing-driven revenue growth over the past year. However, margin improvement has been slow due to rising raw material costs and limited operating leverage from slower-than-expected volume growth. While industrial segments perform well, consumer-facing segments have not shown growth.\n\nThe company advises investors to hold the stock, citing several factors. Improved growth prospects following last year's weakness, reduced impact of higher commodity prices, and improved valuations are currently benefiting the stock. It is trading at a lower price compared to historical levels, with a forward earnings multiple of 40 times compared to a five-year average of 52 times.\n\nBloomberg estimates earnings growth to be flat in FY27 but stronger in FY28 as margin improvement takes effect. Industrial segments, particularly Cables & Wires and Switchgears, are positioned better for growth and margins, accounting for half of revenues. Switchgear has experienced growth interruption due to the Middle East conflicts, but this is expected to recover as alternate shipping routes and markets are established. Cables and Wires reported 27% YoY growth in Q1FY27, but flat volume growth due to rising copper prices.\n\nThe company is adding capacity with a ₹1,000 crore capex plan for FY27, primarily in the Cables and refrigeration segments and an R&D center. Consumer division recovery is gradual, with factors such as GST rate cuts, lower interest rates, and increased disposable income not driving growth last year. Lloyds' RAC division, impacted by weak summer demand, is expected to resume growth with a low base and warmer weather.\n\nHavells has also entered the renewable segment, launching solar inverters, solar pumps, EVSE, and allied products. A 9% strategic stake in Goldi Solar was acquired in Oct-2025 to secure a solar supply chain. Despite a decline in EBITDA margin from 12.7% in FY22 to 7.2% in Q1FY27, the latest quarter's decline is due to advertising expenses doubling to 4.4% in the quarter. The company aims to normalize revenue growth and financials, with a strong balance sheet supporting its position.",
  "summary": "Margin performance should match revenue growth for the company prospects to recover",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}