Earnings Outlook
Voltas Jan-Mar revenue seen growing; margins under pressure
This story was originally published at 20:12 IST on 6 May 2025
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By Simran Rede
MUMBAI - Voltas Ltd. is expected to report a mixed performance for the March quarter, with robust revenue growth driven by its unitary cooling products segment, even as margins are likely to remain under pressure. The company's margins are expected to decline slightly due to rising commodity prices, the absence of price hikes, and a ramp-up in production at its plant.
The new plant in Chennai has a capacity of 1 megawatt and the company has invested around INR 4.5 billion-INR 5.0 billion on it. This newly established air conditioner facility in Chennai continues to ramp up as planned and is gearing up for the season, the company said in its latest investor presentation. It also anticipates the plant's operational efficiency to boost its business in the coming months.
Voltas' consolidated net profit is expected to more than double on year to INR 2.54 billion for the March quarter, according to an average of estimates by 10 brokerages. Sequentially, Voltas' consolidated net profit is expected to rise 92%. The highest estimate of INR 2.77 billion for consolidated net profit is from Equirus Securities Pvt. and the lowest estimate of INR 2.29 billion is from Nuvama Institutional Equities.
The company is expected to report a consolidated revenue of INR 49.17 billion for the quarter, up 17% on year. Sequentially, the company's consolidated revenue is expected to grow over 58%. Prabhudas Lilladher has the highest estimate for consolidated revenue at INR 50.95 billion and the lowest estimate of INR 46.34 billion is from Nomura Equity Research. Brokerages project the company's revenue to grow around 16-20% on year, with its unitary cooling products segment growing 20-22% on year. This segment includes room air conditioners, whose sales are expected to grow 21-24% on year on the back of a favourable summer season and aggressive channel stocking, according to analysts.
Kotak Institutional Equities expects Voltas' earnings before interest and taxes margin for its unitary cooling products segment to fall 150 basis points on year to 7.6%, while Nomura predicts a 220 basis point decline on year to 7%. Nuvama also expects unitary cooling products margins to decline 140 basis points on year due to cost inflation. This segment contributes 57% to the total revenue and 54% to the company's profit before tax.
The margins of the unitary cooling products segment are likely to face pressure due to an under absorption of costs at the company's newly opened Chennai plant, which is operating below full capacity, according to analysts. A rise in costs related to in-store demonstrators and compressors, increased discounts and promotions, despite increases in prices of raw materials, and commercial refrigeration margins below normal levels are also contributing to a slow-growing unitary cooling products segment, according to analysts. Motilal Oswal Financial Services Ltd. expects the company's overall EBITDA to grow 79% on year due to a low base in the previous year.
The consumer durables company will declare its Jan-Mar financial results Wednesday. On Monday, shares of Voltas closed at INR 1,240.30 on the National Stock Exchange, up 2.7%. The stock has risen nearly 16% since it detailed its December quarter earnings. During the previous quarter, the company had reported a consolidated net profit of INR 1.32 billion against a net loss of INR 304.10 million in the year-ago quarter, and its revenue had grown over 18% on year to INR 31.05 billion.
Following are the Jan-Mar earnings estimates of Voltas based on reports from 10 brokerage houses in descending order by the estimate of net profit.
Brokerage firm | Net sales(in INR million) | Net profit(in INR million) | EBITDA(in INR million) |
| Equirus Securities Pvt. Ltd. | 49,711.00 | 2,767.00 | 3,824.00 |
| JM Financial Institutional Securities Pvt. Ltd. | 50,126.00 | 2,765.00 | 3,686.00 |
| Nirmal Bang Equities Pvt. Ltd. | 48,574.00 | 2,652.00 | 3,642.00 |
| Kotak Institutional Equities | 50,573.00 | 2,641.00 | 3,714.00 |
| Elara Securities (India) Pvt. Ltd. | 49,712.00 | 2,516.00 | 3,225.00 |
| Prabhudas Lilladher Pvt. Ltd. | 50,951.00 | 2,482.00 | 3,378.00 |
| Anand Rathi Share and Stock Brokers Ltd. | 49,685.00 | 2,463.00 | |
| Motilal Oswal Financial Services Ltd. | 48,940.00 | 2,458.00 | 3,411.00 |
| Nomura Equity Research | 46,339.00 | 2,317.00 | 3,196.00 |
| Nuvama Wealth Management Ltd. | 47,072.00 | 2,291.00 | 3,298.00 |
| Average | 49,168.30 | 2,535.20 | 3,486.00 |
End
Edited by Akul Nishant Akhoury
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