Havells India Shares Drop 5% as Weak Cooling Demand and Brokerage Downgrades Weigh In

Havells India is a well-known company that makes electrical products like fans, lights, and air conditioners. Even though the company shared strong financial results for the last quarter,and Havells India Shares Drop 5%. This left many people wondering — why did the stock fall when the company actually did well? Let’s break it down in simple terms.

What Happened to Havells India’s Share Price?

On April 23,Havells India Shares Drop to ₹1,583.40 during the trading day. This was surprising because the company’s results for the last quarter (Q4 of FY25) were quite strong. Profits and revenue both increased compared to last year.

So why did the stock still go down? The main reasons were:

• Management gave a cautious outlook about upcoming demand, especially for cooling products like air conditioners.
• Brokerage firms reduced their earnings estimates for the company, which made investors worried about future growth.

Strong Q4 Performance Didn’t Help the Stock

Havells India reported:

• Net profit of ₹517 crore, which is 15.73% more than last year’s Q4.
• Revenue of ₹6,543.56 crore, up by 20.24% from the same quarter last year.

For the full financial year (FY25):

• Net profit was ₹1,470.24 crore, 15.7% higher than FY24.
• Total revenue was ₹22,081.33 crore, a rise of 17.21% over the last year.

These are clearly good numbers. But even with strong performance, the market reacted negatively because of what’s expected in the next few months.

Weak Cooling Product Demand Worries Investors

Havells management mentioned that the demand for cooling products like ACs might be weaker in the coming quarter. The main reason of Havells India Shares Drop is that summer started mildly, especially in South India, which usually buys a lot of these products.

Because of this, brokerage firms like Kotak Institutional Equities and Equirus Securities cut their future earnings estimates and reduced their target prices for the stock.

What Did the Brokerage Firms Say?

Kotak Institutional Equities:

• Cut earnings estimates by 3–4%
• Reduced target price to ₹1,400
• Kept a ‘Sell’ rating on the stock

Equirus Securities:

• Reduced target price to ₹1,967 (from ₹2,057)
• Still gave a ‘Buy’ rating
• Mentioned that room AC demand was slowing down, especially in South India
• Expected good long-term growth in the RAC segment, with Lloyd (Havells’ brand) expected to grow at 14% each year between FY25 and FY28

Other Reasons Behind the Havells India Shares Drop

Here are some more points that affected investor mood:

• Secondary sales (sales from shops to customers) were weak in March and April.
• Inflation is still affecting consumer mood, making people buy fewer expensive items like air conditioners.
• Even though demand is better in the West and Central parts of India, it was not enough to cheer up the stock market.

What’s the Future Outlook?

Despite short-term problems, experts are hopeful about the future:

• Havells plans to invest more in the Lloyd brand and expects better margins (profits) in the coming years.
• By FY26, profit margins may grow to 4.5%, and 5.5% by FY27, thanks to larger production and cost savings.
• The company is also hoping for government help, like easing rules for importing AC parts, which could reduce costs.

Summary of Why the Stock Fell

Here’s a quick summary:

• Good Q4 results were not enough because future demand for cooling products looks weak.
• The slow start to summer in the South affected AC sales.
• Brokerages reduced future earnings estimates and target prices.
• Inflation is hurting consumer spending.
• Investors are reacting more to the future outlook than the past performance.

Conclusion

Havells India is still a strong company with good financial results. But in the stock market, investors care a lot about what will happen next, not just what happened in the past. Because the company said demand for ACs might be low in the next quarter, and some experts lowered their expectations,Havells India Shares Drop even after a good performance. Still, long-term growth is possible, especially if summer picks up and if the government helps by making it easier to import parts. For now, investors are being careful, but the company is working on plans to grow stronger in the future.

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