More Stories

Informist, Thursday, Nov. 6, 2025

 

Please click here to read all liners published on this story

--Blue Star: Overall, Jul-Sept was a tough quarter
--CONTEXT: Comments by Blue Star management in post-earnings investor call
--Blue Star: Commercial ACs did well in Q2, but order inflow fell
--Blue Star: Room ACs segment affected by demand slowdown in Q2
--Blue Star: Order finalisations muted in electro-mechanical segment Q2
--Blue Star: Enquiries good in electro-mechanical projects segment Q2
--Blue Star: Preparations underway for launch of pre-summer products
--Blue Star: Festival season Sept-Oct not gone very well despite GST cuts
--Blue Star: See pressure on room ACs margin as cos vie to cut inventories
--Blue Star: Developing chillers for use in data centres
--Blue Star: Hi-tech pdts for data centres won't be launched before FY26-end
--Blue Star: See steady growth in commercial ACs segment in near term
--Blue Star: Infra projects taking time, making growth projection hard

 

By Rajesh Gajra and Akash Mandal

 

NEW DELHI/MUMBAI – Blue Star Ltd. is developing more chillers for use in data centres, and also exploring partnerships in liquid cooling, the company's management said Thursday in a post-earnings conference call with investors and analysts. But these hi-tech products will require "proper field trials" and commercialising them will take time, Blue Star's Managing Director B. Thiagarajan said in the concall.

 

The company does not expect to launch the hi-tech products in this category before the end of 2025-26 (Apr-Mar), he said. "So, it is not going to be making any kind of significant contribution in this financial year," Thiagarajan said.

 

The company is currently getting "a huge amount of inquiries" from data centres and other clients in the manufacturing sub-segment of its projects business, the management said. In the September quarter, in the company's electro-mechanical projects business, the "execution of factory and data centre projects remained steady though the pace of new ordering flows was subdued," according to the management.

 

Blue Star expects steady growth in the near term in commercial air conditioning systems, which is a sub-segment of the electro-mechanical projects segment. Thiagarajan, however, expressed concerns on the "slow execution of infra projects" where "the speed is not picking up."

 

The order inflow was flat in the September quarter, the management said. "While the inquiry inflows from buildings, data centres, and factories were good, order finalisations during Q2 FY26 (Jul-Sept) was muted," it said.

 

Calling the September quarter as tough, Thiagarajan sees challenges ahead too. He said FY25 was a strong growth year for the company in terms of sales and given the high levels of inventory of room air conditioners in the market "if we close the year with industry being flat, we being flat, we should be very happy."

 

The room air conditioners business was hit by a demand slowdown in the September quarter, the company's management said. Prolonged rains and lower temperatures impacted secondary sales and delayed channel offtake, it said. On the impact of cut in goods and services tax, Thiagarajan said from Aug. 15, when the government announced its intention to cut GST rates, to Sept. 22, when the rates were reduced, "not only the room air-conditioner business and also some segments of commercial air-conditioning business were also impacted."

 

The festival season of Sept-Oct has not gone very well despite the GST rate cuts, the company's MD said. This was because sales during this period were met through the inventories in the channel, and after that "it is dull, (with) movement not taking place," he said. There will be pressure on room air conditioner business margins as the high build-up of inventory will sought to be reduced first, he said.

 

The management said the margin in the segment encompassing electro-mechanical products, commercial air conditioners, service, and international business, will be in the range of 7.0% to 7.5% in Oct-Mar. "This segment is not going to dramatically improve the margins in the coming quarters at all. Because there are...investments that are being made to enhance the reliability of the product," Thiagarajan said.

 

The management believes that in its room air conditioners business, the next window of opportunity in terms of sales will be from mid-February till the end of March, when the pre-summer sales begin. "The preparations are underway for the launch of new products for the pre-summer season," Thiagarajan said.

 

For the September quarter, Blue Star reported a consolidated net profit of INR 990.10 million, up 3% on year and higher than analysts' expectations of INR 932 million. Its consolidated revenue rose 6% on year to INR 24.22 billion.

 

At 1508 IST, shares of the company were down nearly 7% at INR 1,785.80 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Ashish Shirke

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2025. All rights reserved.