Prospects of a long hard summer keeping AC makers upbeat

Intense competition may keep profitability of AC makers under pressure for a few quarters

Sachin Pal
March 10, 2023 / 11:44 AM IST
PRO Only Highlights
Quarterly performance largely backed by improved realisations
Medium-term triggers China plus and protectionist measures for tyre industry
Valuations not inexpensive; but improved medium-term outlook

Highlights AC sector saw decent growth despite multiple headwinds Blue Star and Voltas both posted healthy revenue growth EBITDA margins continued to remain under pressure Stiff competition in AC may affect margins, going forward Companies continue to trade at elevated valuations The December-quarter results of AC companies exhibited a decent growth in revenues, whereas margins remained under pressure. While the potentially intense and lengthier summer augurs well for the AC companies, competition can keep profitability under pressure for a few quarters. Quarterly result highlights Blue Star posted...