Kotak Securities is bearish on Havells India has recommended sell rating on the stock with a target price of Rs 500 in its research report dated July 23, 2018.
Kotak Securities' research report on Havells India
Havells reported 39.5% y/y revenue growth at Rs 25.9 Bn in Q1FY19 driven by consumer durables and lighting business. Ex-lloyd revenues grew 19% y/y. Operating margin, reported at 12% in Q1FY19 was driven by the higher contribution margin in switchgear, cables, consumer durables and Lloyd business. Lloyd reported revenue of Rs 7.08 Bn and EBITDA margin at 9.3% in Q1FY19.
Outlook
We maintain our FY20 earnings estimate. In view of expensive valuations (at PER 33.6x FY20 earnings) we maintain 'SELL' rating with unchanged target price of Rs 500.
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