Havells India Neutral with Target Price of Rs 1340: Motilal Oswal
Havells India Exceeds Estimates with Strong 4QFY26 Earnings
Havells India's (HAVL) fourth quarter earnings for fiscal year 2026 (4QFY26) have exceeded the expectations of Motilal Oswal's research team. The company's earnings were driven by higher margins in the cable & wire (C&W) and lighting segments. However, consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA) saw a decline of approximately 4% year-over-year (YoY) to INR7.3 billion, which is a significant increase of 26% compared to the research team's estimate.
Operating profit margin (OPM) dipped by 70 basis points YoY to 10.9%, a 2.9 percentage point increase compared to the research team's estimate. On the other hand, profit after tax (PAT) adjusted for gains recognized in Goldi Solar and the group's share of profit from investments rose approximately 2% YoY to INR5.3 billion, representing a 39% increase compared to the research team's estimate.
| Segment | Actual 4QFY26 EBITDA | YoY Change | Motilal Oswal Estimate | Difference |
|---|---|---|---|---|
| Cable & Wire (C&W) | INR2.8 billion | |||
| Lighting | INR1.9 billion | |||
| Total | INR7.3 billion | -4% | INR7.6 billion | -26% |
Outlook
Havells India trades at a price-to-earnings ratio of 50x and 40x for fiscal year 2027 (FY27E) and fiscal year 2028 (FY28E) earnings per share (EPS), respectively. Motilal Oswal's research team has reiterated a Neutral rating for Havells India with a target price of INR1,340, based on 40x FY28E EPS.
Investor Takeaway
Investors should maintain a neutral stance on Havells India with a target price of Rs 1340.
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