Amid higher raw material costs, margin pressures may continue for Havells

Demand recovery, however, has been strong which could help partially offset cost inflation

The stock of the country’s largest fast moving electrical goods maker Havells India slipped over 8.5 per cent in trade on worries that pressure on profitability could continue in the coming quarters.

The company, which owns the Lloyd, Crabtree, Havells and Standard brands, reported a steep 605 basis points decline in gross profit margins in the September quarter. The drop in margins was on account of higher raw material costs, lag effect of price hikes and inferior mix. Growth in the switchgear business, which contributes the most to margins, was lower than other segments.

The stock continued to decline