Q1FY14 Results: Havells India Disappoints

Havells India has disappointed the street with lower-than-expected numbers for the first quarter of FY14. The bottomline witnessed growth of 18% on a YoY basis to stand at Rs 94.7 crore as against Rs 80.08 crore witnessed during Q1FY13. The total income from operations increased marginally to Rs 1,051.3 crore in April-June 2013 quarter from Rs 1,032.8 crore reported a year ago. On the EBITDA front, the company has witnessed some improvement with gains of 14.68% on a YoY basis to stand at Rs 133.41 crore. The EBITDA margins stood at 12.69% up by 143 basis points on a YoY basis.

If we look at the segmental performance, there has been a decline in the cables business. The street had expected better growth in the cable division, but in turn, this segment which contributed 38% to the revenue, witnessed a decline of 6.13% to stand at Rs 404.88 crore on a YoY basis for Q1FY14. The operating profit from this segment stood at Rs 40.51 crore for Q1FY14 as against Rs 42.48 crore witnessed during the same quarter last year declining by 4.64%. The other segments - switchgears (+14.28%), lighting & fixtures (-1.08%) and electrical consumer durables (+5.75%) witnessed a mixed performance.

The appreciation in stock prices has been on the estimation that the cable division will be an outperformer. The stock closed the day at Rs 660, witnessing a decline of 12.60% on the BSE.