Voltas 3QFY2016 Results: Angel Broking

Views of Mr. Santosh Yellapu (Sr. Research Analyst - Infrastructure, Angel Broking) on Voltas 3QFY2016 Results:

3Q revenues better than expected, losses at EMP segment lead to disappointment at PAT level

"Voltas reported mix set of numbers, with better than expected top-line numbers and disappointment at the PAT level. Voltas reported 38.6% YoY increase in its top-line to INR 1,301cr, ahead of our estimate of INR 1,247cr. Top-line growth was driven by EMP segment, which reported 56.5% YoY increase (55% of 3QFY2016 revenues). Further, on the back of strong festive season, the UCP segment reported 13.6% YoY increase in its revenues (33% of 3QFY2016 revenues).

Despite strong execution, Voltas disappointed us on the EBITDA front. Voltas reported EBITDA margin of 4.0%, below our estimates and year ago levels of 4.8%. Losses at the EMP segment level led to disappointment at the consol. EBITDA level. Impact of poor operating performance trickled down to the PAT level too. Adj. PAT margins for the quarter declined from 6.7% a year ago to 4.0% in 3QFY2016.

Order book for the EMP segment at 3QFY2016 stood at INR 3,514cr (OB to LTM ratio of 1.4x). We continue to maintain our positive view towards the stock."

Shares of VOLTAS LTD. was last trading in BSE at Rs.229.35 as compared to the previous close of Rs. 241.15. The total number of shares traded during the day was 526741 in over 15476 trades.

The stock hit an intraday high of Rs. 238.75 and intraday low of 211.2. The net turnover during the day was Rs. 118054795.

Source : Equity Bulls

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