Havells India slips as Q2 PAT slides 38% YoY to Rs 187 cr

Havells India fell 2.97% to Rs 1,211.30 after the company reported 38% decline in standalone net profit to Rs 186.87 crore despite of 14% rise in net sales to Rs 3,668.94 crore in Q2 FY23 over Q2 FY22.

Profit before tax stood at Rs 251.49 crore in Q2 FY23, down 38% from Rs 403.45 crore posted in Q2 FY23. Total expenses spiked 21.4% to Rs 3,460.78 crore in Q2 FY23 over Q2 FY22.

EBITDA skid by 35% to Rs 287 crore in Q2 FY23 from Rs 444 crore reported in the same period a year ago. EBITDA margin de-grew to 7.8% in Q1 FY23 from 13.7% posted in Q2 FY22.

Havells said that the consumer demand was slightly sluggish, though stable. Margin during the quarter was impacted owing to full absorption of high-cost inventory against falling RM /sales prices. The impact was pronounced in Cables and Lloyd segment. It believes that margin have hit the trough. Sequential margins from Q1 are stable and will improve from this quarter.

On the segmental revenue front, income from the switchgears segment came at Rs 488 crore, up 10.2% year on year (YoY). The FMEG company said that there has been a reasonable demand environment with real estate upcycle and infrastructure investment.

Revenue from cables segment stood at Rs 1,359 crore in Q2 FY23, rising 18.8% as compared to Rs 1,144 crore recorded in the corresponding quarter last year. Revenue from lighting and fixtures rose 12.1% to Rs 397 in Q2 FY23 crore as against Rs 354 crore in Q2 FY22.

Meanwhile, Electrical consumer durables (ECD) revenue was up 6.2% to Rs 774 crore in Q2 FY23 from Rs 728 crore reported in the year-ago period. ECD revenues were impacted due to short term destocking in fans led by changes in the energy efficiency norms, which is expected to be normalized from third quarter.

Revenue from Lloyd increased by 21.4% YoY to Rs 414 crore in Q2 FY23 as compared to Rs 341 crore recorded in Q2 FY22. The company said that is quarter is seasonally low for ACs. WM has evoked a good response with dealers and consumers.

On consolidated basis, the company's net profit slipped 38.2% to Rs 187.01 crore despite of a 13.6% increase in net sales to Rs 3,679.49 crore in Q2 FY23 over Q2 FY22.

Havells India is a leading fast moving electrical goods (FMEG) company and a major power distribution equipment manufacturer with a strong global presence.

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