Citi maintained its “buy” rating on Havells India with a price target of ₹1,525 per share, indicating an upside of 50% from its previous close.
Following the recent correction in Havells’ stock price, the risk reward has turned favourable for investors, according to the Citi note. The stock had declined 18% in September, marking its worst month since October 2024.
Havells India’s growth trajectory can see an improvement given the continued strength in the wires and cables business, and a recovery in the consumer-facing segments as well, Citi projected in its note.
This, coupled with a better margin profile is estimated lead to a 21% revenue growth and 28% growth in its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) in the September quarter, compared to the same quarter last year, Citi added.
The brokerage believes profit growth could continue to outpace revenue growth in the medium term as well and margins should also benefit from operating leverage in Electric Consumer Division and cables and wires bundled with moderation in losses for Lloyd, Citi aid.
Havells reported its first quarter results in July. Its net profit declined 15.4% to 289 crore from 352 crore, its revenue increased 19.8% to ₹6,6140 crore from ₹5,437 crore.
Its EBITDA declined 8.8% to ₹474 crore and ₹520 crore from last year while its margins contracted to 7.3% from 9.6% in the year-ago period.
Of the 40 analysts who have coverage on the Havells India stock, 28 have a “buy” rating while eight have a “hold” rating and four have a “sell” rating.
Shares of Havells India are trading 2.2% lower on Thursday at ₹1,038.6. The stock is down 27% so far this year.
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