Havells India - Double Impact; Downgrade to Accumulate - Emkay

Reco: ACCUMULATE
CMP: Rs 586
Target Price: Rs 600

- Results below est. - revenues at Rs 9.6bn, up only 13.5% yoy led by decline in industrial cables; EBIDTA margins fell 120bps to 12.4% & APAT at Rs 870mn, up 24% yoy

- Sylvania yet again disappoints with revenues declining 5% yoy to €109.6mn and EBIDTA margin falling to 3-year low of 3.3%. Adjusted for exceptional items, post net loss of €1.5mn

- Management confident on domestic business at 15-20% revenue growth & 12.5-13% EBIDTA margins, but cuts Sylvania EBIDTA margin guidance further to 6% for FY13E

- Revise earnings estimate by -6% and -8% for FY13 & FY14E following weakness in Sylvania business. Downgrade to Accumulate with TP of Rs600/Share.

Source : Equity Bulls

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