VOLTAS Limited is India’s largest air conditioning company which offers a comprehensive range of cooling & home appliances including room air conditioners, air coolers, air purifiers, domestic refrigerators, washing machines, water dispensers, dishwasher, microwave, commercial refrigeration, and accessories. It is also engaged in the business of air conditioning, refrigeration, electro - mechanical projects as an EPC contractor both in domestic and international geographies (Middle East and Singapore) and engineering product services for mining, water management and treatment, construction Equipments and textile industry.

It is India’s NO.1 AC brand with highest market share of 21.2% market share in room Acs and 36% in window ACs. It has 30K+ customer touch points, 330+ EBOs and 5 Experience Zones across the nation with the help of which it has successfully cooled 10 million + households through its products and 1 out of every 4 room AC and 1 out of every 3 commercial refrigerators sold in India is a Voltas product. The company sold 1 mn units in 88 days. As of Q1FY25, company has 6 manufacturing facilities at Waghodia (Gujarat), Sanand (Gujarat) and 2 at Pantnagar (Uttarakhand) and 3 R&D centres. The company has a manufacturing capacity (CAC) 5 lakh ton and (AC) 4.9 million units.
Recently the company commenced operations in its Chennai factory which has the capacity of manufacturing 2 mn units of Room Acs.
The company has also began commercial operations of Water Dispenser plant at Waghodia.

Company has also launched a range of Voltas Beko home appliances in partnership with Beko of Arçelik Group group owned by Koç Holding - a Fortune Global 500 company in Europe. Voltas Beko has 22 production facilities across 8 countries with 20 R&D and design centres innovating products through which it has achieved 150% growth and became the fastest growing home appliances brand in India and has sold over 3.3 million products through 7,000+ touchpoints and 150+ SKUs. Voltas Beko is the first brand in India to launch a 5-star rated washing machine and Beko is among the top 3 Large home Appliance brands in Europe along with servings in 135 countries.

Under its International Operations Business Group (IOBG) the company operates in Mechanical, Electrical & Plumbing (MEP), Heating, Ventilation and Air Conditioning (HVAC) and Water Management. IOBG specializes in providing comprehensive electromechanical solutions and services to its clients in Middle East and Asia region. The company has successfully completed multiple projects across GCC, including Dubai, Oman, Qatar, Bahrain etc. The company has an order book of Rs.2,734 crs. in Q1FY25.

Under the Universal MEP Projects & Engineering Services Limited (UMPESL) the company offers - MEP,HVAC, Water Infrastructure, Electrical & Solar Projects, O & M. The company has restructured their B2B business into this segment and currently it has an order book of ~Rs. 4,770 crs. as of Q1FY25. It has completed Water Projects of SAIL, Bokaro & Rourkela and OWSSB Cuttack, delivered Solar EPC Project and also secured orders of ~₹ 500 crores for Water supply under Jal Jeevan Mission. It has also installed 265 water treatment and distribution plants in the Madhepura (Bihar). The Company is working on similar groundwater projects, to benefit 600 villages in UP.

Under its Textile Machinery Division (TMD) the company enjoys 65% Market share of spinning machinery. It also plans to grow market share in capital machines, in Spinning and Post Spinning. The company has added Spreading machines and weaving preparatory machines to its portfolio and plans to add Embroidery to strengthen value chain in Post Spinning.

Its Mining and Construction Equipment division has grown its business across India and expanded its reach to Mozambique through partnerships with Tata Mozambique and Tata Africa.

The company has also entered into a technology license agreement with Vestfrost Solutions, Denmark, to develop, manufacture, sell and service medical refrigeration and vaccine storage equipment in 2023. This will enable the compant to enter the Bio Medical and Cold Chain industry for vaccine storage equipment such as ice-lined refrigerators, vaccine freezers, and ultralow temperature freezers, in the Indian market.

On International Operations front the company has successfully completed multiple projects across GCC, including Dubai, Oman, Qatar, Bahrain and the company has an order book of Rs.2,356crs. Company's WOS, UMPESL won multiple project orders valued at ~Rs. 3,762 crs, including a solar power project. Its IOBG segment bagged a project worth Rs. 942 crs in Riyadh, Saudi Arabia, for Qiddiya Water Theme Park along with multiple projects, including Jubail for HVAC division and the world’s largest desalinated water production plant.

Under its Mining and Construction Equipment (M&CE), company offers O & M, Crushing & Screening Machinery. It has grown its business across India and expanded to Mozambique through partnerships with Tata Mozambique and Tata Africa. Extensions of marquee contracts were secured, and additional projects were added in both Mozambique and India in Q1FY25.

Company’s order book position stands at 4769Crs. in Domestic Projects Group and 2734Crs. in IOBG.

Fundamentals:

Financial Results:

In Q3Fy25, the company reported a 28% increase in Consolidated Total Income, reaching Rs. 10,890 crores, up from Rs. 8,477 crores in the same period last year. Profit before tax surged by 172%, amounting to Rs. 848 crores compared to Rs. 312 crores previously. Net Profit (after tax) also experienced a significant rise, standing at Rs. 599 crores, up from Rs. 137 crores in the corresponding period last year which is the highest nine-month profit in the company's history.

As per quarterly performance, the Consolidated Total Income grew by 18%, reaching Rs. 3,164 crores, compared to Rs. 2,684 crores in the same quarter last year. Profit before tax soared by 699%, amounting to Rs. 191 crores from Rs. 24 crores. Net Profit (after tax) also saw a substantial increase, climbing to Rs. 131 crores from an after-tax loss of Rs. 28 crores in the corresponding quarter last year.

On segmental front company’s The Unitary Cooling Products business continued to maintain its growth momentum as its Overall volume growth for 9 months were recorded at 42%. Its Segment Revenue grew by a remarkable 38%, reaching Rs. 7,155 crores, up from Rs. 5,198 crores in the same period last year. Segment Result also saw a significant increase of 30%, amounting to Rs. 548 crores compared to Rs. 423 crores in the corresponding nine months of the previous year.

The performance of JV -- Voltbek Home Appliances Private Limited also continued to be robust, with a volume growth of 56% in the nine months ended 31 December, 2024.

Its Domestic Projects business, which includes MEP, Water, Electrical, and Solar sectors, experienced a growth of approximately 17% during the quarter ended December 2024. In the International Projects business, projects in the UAE and Saudi Arabia continue to perform well, contributing positively to both revenue and results. For the nine-month period, segment revenue increased by 17%, reaching Rs. 3,019 crores, compared to Rs. 2,585 crores in the same period last year. The segment result was a positive Rs. 170 crores, a significant turnaround from a loss of Rs. 221 crores last year, which was due to provisions made on receivables in the international business. For the quarter, segment revenue was Rs. 1,190 crores, compared to Rs. 982 crores in the same quarter last year. The segment result for the quarter was a positive Rs. 57 crores, compared to a loss of Rs. 120 crores in the corresponding quarter last year.

Its Engineering Products and Services segment faced certain headwinds in its performance. For the quarter, segment revenue was Rs. 130 crores, compared to Rs. 155 crores in the same quarter last year. Segment Result for the quarter was Rs. 37 crores, as against Rs. 50 crores in the corresponding quarter last year.

Key Updates:

1. Voltas Beko recently launched its two latest innovations in the Small Domestic Appliances (SDA) category, the Mixer Grinder and Dry Iron, is now available exclusively on Flipkart. The Voltas Beko Powerfull Mixer Grinder boasts of a powerful motor, durable design, and multiple speed settings, making it ideal for all types of grinding, blending, and juicing. With unique features like GrindX blades and anti-topple base, and a sleek, compact design, it ensures both efficiency and style in the kitchen. It is designed to handle everything from smoothies to chutneys with ease, offering versatility to meet every culinary need. On the other hand, Voltas Beko Dry Iron is a lightweight dry iron with multiple temperature settings, that will help to iron clothes, remove wrinkles and make them look crisp and tidy.
2. Voltas Limited also launched new and exclusive brand stores in Faridabad, today. Voltas, which holds the top position in the Indian AC market, is also a prominent brand in Haryana and Delhi NCR. With this new addition, Voltas now boasts a total of 20 brand stores in Haryana and 38 across the Delhi and Haryana belt.
3. It has launched new and exclusive brand stores in Shahjahanpur, today. Voltas, which holds the top position in the Indian AC market, is also a prominent brand in East Uttar Pradesh, West Uttar Pradesh, and Uttarakhand. With these new additions, Voltas now boasts a total of 29 brand stores in Eastern Uttar Pradesh and 54 across the UP and Uttarakhand region.
4. Voltas is also planning to launch its new range of 5-star Hard Top Convertible models along with the new ISI Mark Water Cooler and Water Dispenser line-up at this event.
5. Voltas Beko and Europe’s leading free-standing consumer durables player, Arçelik, has entered into collaboration with Vim Matic by Hindustan Unilever (HUL), India’s leading dishwash brand. This partnership is set to enhance the dishwashing experience by combining Voltas Beko's advanced dishwashers with Vim Matic's powerful all-in-one cleaning tablets for seamless kitchen convenience.
6. Voltas has also announced the revival of its iconic All-Weather winter campaign in the states of North India primarily on Digital platforms & Radio, to create traction for its All-Weather Hot & Cold AC proposition, while emphasizing its suitability for diverse weather conditions.
7. Company has also launched its new exclusive brand store in Varanasi, today. Besides being the No. 1 AC Company across India, Voltas is also a leading brand in East Uttar Pradesh, West Uttar Pradesh and Uttarakhand markets. Along with this new brand store, Voltas now has a total of 28 brand stores in Eastern Uttar Pradesh and 53 stores in all in the UP & UK region. 

In conclusion, this fundamental research report on Voltas Ltd. highlights the company's strong market presence, particularly in the consumer durables and engineering solutions segments. Through a detailed analysis of its financial performance, operational efficiency, and market positioning, it is evident that Voltas has maintained a resilient business model backed by strategic partnerships and a robust brand reputation.

While the company faces challenges such as market competition and input cost volatility, its continuous focus on innovation, sustainable growth initiatives, and expanding its product portfolio positions it well for long-term growth. Investors may consider Voltas Ltd. as a viable investment opportunity, particularly given its consistent financial performance and strong market leadership.

Future growth prospects will depend on the company's ability to adapt to changing market dynamics, maintain operational efficiency, and leverage emerging opportunities in both domestic and international markets. Further monitoring of key financial indicators and industry trends is recommended to make informed investment decisions.

HET ZAVERI

info@smartinvestment.in

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