(Reuters) -Home appliances and electrical goods maker Havells India reported a 19% rise in second-quarter profit on Friday, as strong demand in its core cables segment offset weakness in cooling products segment.
The company reported a profit of 3.2 billion rupees ($36.33 million) in the three months ended September 30, up from 2.67 billion rupees a year ago.
Revenue from operations rose nearly 5.3% to 47.79 billion rupees, while total expenses climbed 4.4% to 44.56 billion rupees.
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KEY CONTEXT
India’s top wires and cables players, such as Havells and Polycab have seen robust demand in recent months due to healthy government expenditure on infrastructure and the booming real estate sector.
Sales in Havells’ mainstay cables segment grew 19% year-on-year in the second quarter.
The strength in cables offset the impact of declining sales in its electric consumer durables (ECD) and appliances segments, under the brand ‘Lloyd’, as consumers deferred purchases ahead of the implementation of the goods and services tax cuts and as a cooler summer persisted.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBI Price/ Revenue Profit Mean No. of Stock to Div
TDA Sales growth (%) growth (%) rating* analyst price yield
s target** (%)
Havells India 49.54 32.54 3.66 12.36 18.27 Buy 24 0.86 0.68
Polycab India 41.36 28.35 3.82 19.18 21.26 Buy 28 1.00 0.46
R R Kabel 30.94 19.28 15.47 26.77 Buy 8 0.82 0.55
KEI Industries 41.77 27.94 20.28 23.13 Buy 14 0.93 0.10
* The mean of analysts’ ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
JULY TO SEPTEMBER STOCK PERFORMANCE
($1 = 88.0730 Indian rupees)
(Reporting by Ananta Agarwal in Bengaluru and Praveen Paramasivam in Chennai; Editing by Eileen Soreng)
