According to a brokerage house, ICICI Securities, Havells India delivered steady revenue growth of 17 per cent YoY (year-on-Year) in FY-2025, which was supported by a strong performance in the wires and cables (W&C) segment and switchgear, even as the electrical consumer durables (ECD) segment faced demand challenges. In Q2-FY26, the company exhibited decent growths across segments. Sales grew by 5 per cent YoY and, at Rs 47,793 crore, were broadly in line with the experts’ estimates. The diversified portfolio continues to buffer it against the volatility in specific product lines. Prabhudas Lilladher, another brokerage house, noted in a recent report that “Havells reported moderate growth in Q2-FY26, primarily impacted by declines in the Lloyd and ECD portfolios…. However, wires and cables delivered strong growth, and LED pricing stabilisation supported the lighting segment.” Hence, there were differentiation in the various segments, which performed differently. Despite near-term pressures, the long-term outlook remains robust.
The second quarter results reflected the strengths in operational management amid a shifting market environment. While consolidated revenue rose, PAT (profit after tax) increased 18.9 per cent YoY to Rs 3.2 billion. According to Prabhudas Lilladher’s report, “EBITDA grew by 16.9 per cent YoY to Rs 4.4 billion, with margins expanding 90 basis points YoY to 9.2 per cent.” The improvement came largely from the C&W business, which saw segmental margins expand by 510 basis points to 13.7 per cent, which offset the weaknesses in Lloyd and ECD. A recent report by Elara Securities reiterated this margin resilience to a favourable mix shift, “EBITDA margin expanded… despite difficulty in Lloyd and ECD, due to strong performance in C&W.” The company’s revenue mix remains balanced. As per Elara Securities, “The C&W segment grew 12 per cent YoY… led by expansion in cable capacity, higher copper prices, and healthy volume growth….” Switches and switchgears grew 8 per cent YoY, and lighting saw a similar growth.
Havells’ earnings trajectory remains on a firm footing. Elara Securities projects an earnings CAGR (compounded annual growth rate) of 24 per cent for FY25-28E, with an average ROE (return on equity) and ROCE (return on capital employed) of 23 per cent, and 22 per cent, respectively. The brokerage expects revenue to rise by a 14 per cent CAGR between FY25 and FY28. PL Capital, another brokerage house, projects EBITDA CAGR of 12.9 per cent, and PAT CAGR of 13.3 per cent over FY25-28E, supported by an EBITDA margin improvement to 10.2 per cent by FY28E. According to ICICI Securities: “Havells is well-positioned to deliver mid-teens earnings growth over FY25-27E, with margin improvement led by mix normalisation and operating leverage.” Thus, both profitability, and overall margins are on track over the next two years.
While Havells is a well-diversified consumer electricals major, short-term risks are tied to seasonal volatility, and high inventory levels in some segments. A few recent reports noted that there was an inventory accumulation after a mild summer season, and subdued secondary demand. According to Elara Securities, “Lloyd saw a difficult quarter as the room air conditioner industry was hit by weather change, and large amounts of inventory pending in the channel.” The firm added that inventory levels are likely to normalise by Q3-FY26 following the GST reduction on RACs (room ACs), and star rating change from January 2026. Similar sentiments were echoed by ICICI Securities: “Lloyd faced a challenging year due to shorter summer and channel destocking, but structural tailwinds remain intact with GST rationalisation and product portfolio expansion.” Prabhudas Lilladher flagged similar concerns: “Elevated inventory levels in cables and Lloyd led to higher working capital. Inventory is expected to be largely liquidated by Q3FY26, while working capital is expected to normalize by Q4FY26.”
Havells’ biggest strength lies in its diversified product portfolio, robust brand equity, and disciplined financial management. Its integrated business model, with in-house manufacturing across categories, allows it to control costs and quality effectively. According to Elara Securities, “We reiterate Accumulate as HAVL (Havells) is a strong player in the consumer electricals space due to a well-diversified portfolio, and the stock has underperformed Nifty by 7 per cent in the past 3 months.” The C&W segment is the growth engine. Strong volume and value growth, supported by capacity expansion and rising copper prices will help the company. “Cables saw similar value and volume growth, while wires' value growth outpaced volumes due to rise in copper prices,” stated Elara Securities. PL Capital emphasised the stability of the core business. “Growth momentum is expected to pick up in the solar portfolio, and W&C segment, supported by recent capacity expansions. Contribution margins, currently impacted by underutilisation and elevated inventory levels, are expected to stabilise and improve….”
The company’s switchgear and lighting businesses remain profitable pillars. Switchgear EBIT margins stood at 22.3 per cent, and lighting segment margins were stable at 12.7 per cent. Havells has maintained a debt-free balance sheet, providing flexibility for capex and acquisitions. Looking ahead, Havells appears well-positioned to benefit from structural demand growth in India’s consumer electricals market, rising urbanisation, and premiumisation trends. Brokerages maintain a positive “Accumulate” rating, with Elara Securities setting a target price of Rs 1,580, and PL Capital Rs 1,653. reflecting 8-12 per cent potential upside from current levels. Elara Securities concluded optimistically: “Expect an earnings CAGR of 24 per cent in FY25-28E, with strong return ratios….” The market price of the stock was Rs 1,494.9 on 24 October.