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<ul><li><keyword id="6354999" type="COMPANY" weightage="20" keywordseo="voltas">Voltas</keyword> is the biggest player in the Air Conditioners, and it has hinted that it is looking to hike prices, but is waiting for the demand to improve. </li><li>There is also the fear of the government raising the import duties, pushing the company to hike prices. They are also gradually developing alternative sources of raw material domestically. </li><li>Voltas management remains confident that it will gain more market share, especially in room air conditioners. </li><li><a href="https://www.businessinsider.in/">Check out the latest news and updates on Business Insider.</a> </li></ul>India’s top air conditioner manufacturer, Tata Group company Voltas hinted that it might hike the prices to offset the rising commodity prices. However, it is waiting for demand to improve. This decision of hiking the prices may be further expedited by the fear of the Indian government raising the import duty after the recent tensions with China. The company said it would need a 3-4% price hike after it finds an alternative source of raw material domestically, according to the IIFL Securities report dated December 4. The management’s confidence may stem from its latest quarterly report, which impressed the street with better performance than its peers like BlueStar, Whirlpool. In the second quarter, the company recorded 14% overall volume growth led by a 1% jump in room air conditioners (ACs), 20% in commercial refrigeration products, and 28% in air coolers. <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Voltas </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">July-Sep 2021 </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Growth over same period last year </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Revenue </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,650.80 crore </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">10.5% </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Profit </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹79.66 crore </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-25.7% </td></tr></tbody></table> Even with the possible price hikes, Voltas management remains confident that it will gain more market share, especially in room air conditioners (AC). Healthy festive demand and steady distribution reach, along with their product expansion plans could augur well for the company. <div type="image" title="Voltas market share" msid="79624389" hostid="261"></div> Brokerages remain cautious This optimism reflects in the company’s share price as well, which has rallied over 49% since the beginning of the second quarter. However, despite management’s positive outlook, brokerages remain wary about its near-term growth. <div type="image" title="Voltas" msid="79624357" hostid="261"></div> The IIFL report highlighted that its “medium-term outlook is impacted by the subdued awards pipeline, even as Voltas remains cautious about booking new orders.” <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Brokerage </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Recommendation </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Target Price </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Edelweiss </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Sell </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹725 </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Geojit BNP Paribas </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Hold </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹848 </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Nirmal Bang Institutional </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Accumulate </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹835 </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Motilal Oswal </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Neutral </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹775 </td></tr><tr><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ICICI Direct </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Hold </td><td style="border-left:solid #000000 0.9907650000000001pt;border-right:solid #000000 0.9907650000000001pt;border-bottom:solid #000000 0.9907650000000001pt;border-top:solid #000000 0.9907650000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹845 </td></tr></tbody></table>*source- Trendlyne SEE ALSO: <a href="https://www.businessinsider.in/science/health/news/bharat-biotech-applies-for-emergency-use-approval-for-its-covid-19-vaccine-covaxin/articleshow/79617391.cms" data-type="tilCustomLink">Bharat Biotech applies for emergency use approval for its COVID-19 vaccine Covaxin</a> <a href="https://www.businessinsider.in/science/health/news/covid-19-vaccine-in-india-expert-panel-to-review-pfizer-serum-and-bharat-biotechs-emergency-use-application-tomorrow/articleshow/79617336.cms" data-type="tilCustomLink">COVID-19 vaccine in India: Expert panel to review Pfizer, Serum and Bharat Biotech's emergency use application tomorrow</a>

Voltas is telling analysts that it may hike AC prices by 3-4% to cover rising input costs

<ul><li>The price of Indian white goods and durables have increased as much as 20% in the last two years due to inflation.</li><li>The price of copper, steel and aluminium — the key raw material in this sector — have corrected in the last three months.</li><li>White goods items include ACs, fridge, microwaves and washing machines, which are considered a luxury in India.</li></ul>The premium you have been paying on all your household electronics like ACs, fridge, microwaves and washing machines may come off sooner than expected as companies look to pass on the benefits of falling input costs in the festive season. The price of copper, steel and aluminium — the key raw materials in this sector — have corrected in the last three months, after reaching all-time highs. This correction will directly benefit white goods manufacturers — like Bajaj Electricals, Bluestar, Crompton, Havells, Voltas, and Whirlpool to name a few — as procurement of raw material gets more economical. Copper is 21% cheaper, steel is 19% cheaper and aluminium is 36% cheaper from their April levels this year, according to a recent report by ICICI Securities. This, coupled with the fact that customers have been paying over 20% extra on these household durables since the start of the Covid-19 pandemic two years ago, will increase margins for these companies. “With a correction in input prices, the need to raise prices has declined. We believe a breather was essential considering durable companies have raised prices incessantly in the past two years. The cumulative price hike was higher than 20% in the past two years,” the brokerage firm added. <cmsannotation type="cmsannotation" annotationid="So will the prices go down?" comment="subhead" text="So will the prices go down?">So will the prices go down?</cmsannotation> Not exactly, but that is simply because the white goods and durables industry usually carries a larger inventory. The companies may want to clear their old stock before selling newer items produced with cheaper raw material. But that isn’t necessarily bad either. ICICI Securities believes that the increased margins will push the manufacturers of ACs, refrigerators, microwaves and washing machines to raise their advertising efforts and offer better discounts to the customer. The case for the customer strengthens as these developments come in the second half of the year, with the festive season just a few months away. “We do not model durable companies to pocket all the benefits and expect them to invest gains [in four areas],” the ICICI report added. One of the areas the companies are likely to invest in is advertising as ad-spends have remained on the lower side for the past three years. Secondly, they are likely to increase their spending in research and development and launch a range of new products. The companies will also increase their trade schemes and discounts. Lastly, they are likely to increase the number of consumer offers to gain market share from smaller or unorganised players, the report added. The only thing going against the industry, in terms of manufacturing, is crude oil prices that have stayed above the $100/a barrel level for most of 2022. A higher-than-expected increase in crude prices could shave off the benefits of lower input costs and pressure the margins of white goods and durable companies. <cmsannotation type="cmsannotation" annotationid="How will the industry perform?" comment="subhead" text="How will the industry perform?">How will the industry perform?</cmsannotation> ICICI Securities is quite positive about the white goods and durables sector as it counts on strong return ratios, healthy growth potential and low penetration levels. “We also expect the migration from unorganised to organised sector to steadily generate value. Havells India and Crompton Greaves are our top picks,” the firm added. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Company </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Rating </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Target Price </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">3M India </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BUY </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹26,000 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Amber </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ADD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹2,280 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bajaj Electricals </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ADD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,035 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bluestar </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HOLD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,047 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Crompton Cons. </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BUY </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹504 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;"> Dixon </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HOLD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹3,950 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Havells </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BUY </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,644 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;"> Orient Electrics </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ADD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹285 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Polycab </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HOLD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹2,500 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">TTK Prestige </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BUY </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹975 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">V-Guard </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ADD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹250 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Voltas </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">HOLD </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹1,033 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Whirlpool </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">BUY </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">₹2,000 </td></tr></tbody></table>Source: ICICI Securities Research White goods consist of LED TV, air conditioners, refrigerators, washing machines, dishwashers and microwaves, items which are considered luxury. A report by BNP Paribas, released in May, noted that the consumer electricals industry is witnessing a market shift from the unorganised to the organised one, thanks to demonetisation, GST implementation and the pandemic. The company believes that one in three consumer electrical items sold in the market is still in the unorganised sector, which gives the players in the organised sector a lot of room to grow. “The Indian consumer durables sector is still nascent, given low penetration levels of various products, especially white goods,” the report added. SEE ALSO <a href="https://www.businessinsider.in/retail/news/delhi-to-have-its-own-version-of-the-dubai-shopping-festival-starting-2023/articleshow/92698118.cms" data-type="tilCustomLink">Delhi to have its own version of the Dubai shopping festival starting 2023 </a> <a href="https://www.businessinsider.in/business/corporates/news/indias-biggest-companies-spend-nearly-11-lakh-crore-on-employee-expense-last-year/articleshow/92690317.cms" data-type="tilCustomLink">If you thought techies got the biggest hikes last year, think again...</a> <a href="https://www.businessinsider.in/business/news/no-service-charge-on-restaurant-bill-will-impact-waiters-servers-kitchen-staff/articleshow/92668785.cms">Remember to tip your waiter, there is no more service charge on your bill</a>

Your ACs, fridge and washing machines may get cheaper soon

<ul><li>According to a report by BNP Paribas, 8% Indian households had an ACs in fiscal year 2020.</li><li>The cost of ACs and the energy they consume is the main reason why ACs are considered luxury items.</li><li>The increase in commodity inflation and high competition has been limiting the <keyword id="13221674" type="General" weightage="20" keywordseo="ac-companies" source="Orion">AC companies</keyword>’ ability to increase their margins.</li></ul>The business of selling air conditioners has still not reached its full potential as it continues to be a luxury item for most Indian households. Even though several large brands like Voltas, LG, Daikin, Hitachi, Blue Star and Lloyd have been selling ACs for the past five to seven decades, they have still not been able to enjoy higher margins from this about-to-boom segment. This year however may be a good one. The demand for air conditioners is expected to increase due to scorching heat across several parts of India, according to a report by international financial services company BNP Paribas. The mercury has crossed 45 degree celsius in several places and<a href="https://www.businessinsider.in/science/environment/news/what-happens-to-the-human-body-when-the-temperature-reaches-50-degree-celsius/articleshow/91589906.cms"> touched 49 degrees in Delhi</a>, so people have been rushing to buy ACs in order to keep themselves cool. “We estimate the Indian AC industry market size at ₹180 billion (₹18,000 crore) with a potential CAGR [compound annual growth rate] of 15% over FY21-25,” the report said. BNP Paribas noted that 8% of Indian households had an AC in 2020, with 7 million units being sold in the same year. This is quite low when compared with the fact that four in ten — or 42% — households across the world have an AC. <div type="image" title="Heatwave has turned ACs from a luxury to a necessity — but margins remain muted for the players" msid="91655539" hostid="261"></div> The cost of ACs and the energy they consume is the main reason why ACs are considered a luxury item — making it unaffordable for many Indian households. The increase in commodity prices is hurting the manufacturers even further. <cmsannotation type="cmsannotation" annotationid="High competition is limiting ACs companies in India" comment="subhead" text="High competition is limiting ACs companies in India">High competition is limiting ACs companies in India</cmsannotation> Covid-19, the resultant lockdown and the Russia-Ukraine conflict that followed have had a major impact on commodity prices. Even a bag of detergent now costs <a href="https://economictimes.indiatimes.com/news/economy/indicators/how-a-detergent-could-have-helped-rbi-act-swiftly-on-inflation/articleshow/91587940.cms">20% more </a>than last year, but FMCG companies have the option of increasing the price of their products and passing it on to the customers. <div type="image" title="Heatwave has turned ACs from a luxury to a necessity — but margins remain muted for the players" msid="91655586" hostid="261"></div> However, the same price increase has not been possible in the whitegoods space like ACs, refrigerators or washing machines because they are already expensive compared to other fans or coolers, and competition in the industry is extremely high. “Moreover, the Indian whitegoods industry is highly competitive, given the presence of large MNCs like Samsung, LG, Whirlpool, Haier, Daikin, Hitachi, etc. as well as strong Indian brands like Voltas, Lloyd (Havells brand), Blue Star, IFB to name a few. Such high competitive intensity also limits the ability to hike prices,” BNP Paribas said in its latest report. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Change in gross margins (bps) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY2018 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY2019 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY2020 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY2021 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Blue Star </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(361) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(62) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">13 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(177) </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Voltas </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(110) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(255) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">133 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(129) </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Whirlpool </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(344) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(46) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">161 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(255) </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Johnson Controls-Hitachi Air </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(10) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(70) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">83 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">94 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">IFB Industries </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">178 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">(247) </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">187 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">74 </td></tr></tbody></table>Source: BNP Paribas, Company Data Note: BPS stands for Basis Points, which is a unit of measure to describe the percentage change in value. The top six companies in the whitegoods space include Voltas, LG, Daikin, Hitachi, Blue Star and Lloyd, which cumulatively controlled 70-75% of the market share by volume in the fiscal year 2020. “Over the long run, we expect the market to consolidate in favour of the top 4-5 companies,” BNP Paribas noted, citing the Production Linked Incentive Scheme (PLI) as one of the major reasons for this expected consolidation. <cmsannotation type="cmsannotation" annotationid="High price is not the only thing muting demand" comment="subhead" text="High price is not the only thing muting demand">High price is not the only thing muting demand</cmsannotation> The industry size of air conditioners in India is almost double that of fans, which have made a mark on 80% households in India, but still the margins continue to be low on this white commodity. One of the main reasons is that AC is a seasonal item and has higher inventory costs due to the volume of the product. <div type="image" title="Heatwave has turned ACs from a luxury to a necessity — but margins remain muted for the players" msid="91655604" hostid="261"></div> Secondly, the market has been affected since 2016 due to the disruptions such as demonetisation and introduction of goods and services tax (GST). The Covid-19 wave, which compelled people to stay at home for almost two years, also hindered the demand. SEE ALSO <a class="tout-title-link" href="https://www.businessinsider.in/stock-market/news/itc-aditya-birla-fashion-lic-housing-finance-among-stocks-to-watch-out-for-on-may-19/slidelist/91653552.cms">ITC, Aditya Birla Fashion, LIC Housing Finance among stocks to watch out for on May 19</a> <a href="https://www.businessinsider.in/stock-market/news/delhivery-ipo-heres-how-you-can-check-the-allotment-status/articleshow/91650014.cms">Delhivery IPO: Here’s how you can check the allotment status</a> <a href="https://www.businessinsider.in/business/telecom/news/reliance-jio-vs-bharti-airtel-four-charts-to-showcase-how-indian-telecom-giants-faired-in-2022/slidelist/91640306.cms" data-type="tilCustomLink">Reliance Jio Vs Bharti Airtel — Four Charts That Showcase How The Indian Telecom Giants Faired In 2022 </a>

Heatwave has turned ACs from a luxury to a necessity — but margins remain muted for the players

NEW DELHI: As we inch closer to the Budget 2014, Dalal Street is abuzz with expectations of strong pro-growth reforms from Finance Minister Arun Jaitley. 
 
Given high expectations from the government, all attempts are expected to be made to present a comprehensive Union budget. However, the residual period until the next Budget to be presented is relatively small. 
 
Experts feel that the focus of the new government would be more on creating opportunities for retail investors in financial markets. But it is definitely not going to be a cakewalk for them. 
 
“The budget itself is not going to be a cakewalk. In fact, it is going to be a tight rope walk for the government,” said Killol Pandya, Senior Fund Manager-Debt, LIC Nomura MF. 
 
“The economy has certain structural and macro issues which it is facing and the government will be at pains to balance putting our growth story back on track while battling the inflation bugbear,” he added. 
 
The fact is that most of the steps which the government can take to promote growth and kick start the economy will have short-term inflationary ramifications. However, in terms of market performance, analysts see the markets rallying nearly 5-6 per cent in the run-up to the event. 
 
 
 
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Traders carried forward bullish futures bets to the July series on the expiry of the June contracts on Monday on expectations the market could rebound in the run-up to the Union Budget on July 10. 
 
Fresh build-up of positions in Nifty options suggests the benchmark index could gain about 5-6% by the Budget day from the current levels, said an ET report. 
 
Most analysts are of the view that despite escalating tensions in Iraq and depreciating rupee, Indian markets should be able to scale higher from the current levels, supported by strong FII flows and as most of the oil, which is imported, comes from the southern region, which remains unaffected. 
 
“The overweight by international investors in India will be highest in the whole emerging market space and we think it will continue. We think there is a re-rating going on in India,” said Hans Goetti, Head of Investment Asia, BIL. 
 
“We think if there is a new earning cycle start on the back of a stronger economy, then it can grow at about 6.5 per cent for several years, accompanied by higher prices in the equity markets,” he added. 
 
History suggests that the Union Budget’s influence on the market’s short-term performance is declining, but the next budget could still leave a trail of impact. 
 
The upcoming budget could be important because of where India is placed cyclically, what the mandate for the government implies and because this is the first non-Congress government in a decade, say experts. 
 
“Though history suggests that the budget’s influence on short-term performance is declining, expectations (measured by pre-budget performance) are still important in deciding what the market does after the budget,” said Ridham Desai, India Strategist at Morgan Stanley, in a report. 
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“If the pre-budget returns are positive, there is a 90% chance that the post-budget returns are negative,” he added. 
 
We have collated a list of ten stocks which investors can look at ‘buying’ ahead of the Budget 2014, for the next 12 months: 
 
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	Brokerage Firm: BofA-ML 
 
 
Titan Company Ltd: Target price set at Rs 406 
 <keyword id="10899" type="CITY" weightage="40" keywordseo="Titan-Industries">Titan Industries</keyword>, a Tata Group company, is India’s leading watch and jewelry retailer. Titan’s growth can pick up in FY15/16E as SSSG in jewelry bottoms out. This can be led by a favorable macro: easing inflation, possible pick-up in the urban job scenario and wage hikes. 
 While resumption of the sale of <keyword id="18712" type="ENTERTAINMENT" weightage="40" keywordseo="Gold">gold</keyword> coins can improve operating leverage, possible margin benefits due to focus on premiumization in jewelry as well as watches can boost earnings. 
 
ICICI Bank Ltd: Target price set at Rs 1,850 
 
The global investment bank is bullish on ICICI Bank as it has built a strong retail franchise to complement its corporate banking activities and capitalize on the fast-growing retail market. ICICI Bank has expanded distribution to 3,500 branches, allowing it to acquire customers at a very rapid pace and also gain share. 
 
The bank enjoys a strong capital position (Tier 1 at 12.8%), and is well placed to manage credit cycle/regulatory changes and deliver earnings growth of 16-22% through FY15/16. Outperformance should be driven by: 1) Op. efficiency (CI ratio improving to lesser than 38-39% in FY15/16 vs 41% in FY13); and 2) Credit cost at 80bps. 
 
Maruti Suzuki Ltd: Target price set at Rs 2900 
 Maruti Suzuki (MSIL) is a subsidiary of <keyword id="111052" type="CITY" weightage="40" keywordseo="Suzuki-Motor">Suzuki Motor</keyword> Corp, Japan. Set up in 1983, MSIL is presently India’s largest passenger car company which primarily sells compact hatchbacks (65% of volumes), vans and upper sedans. 
 
MSIL is our top pick in the Indian autos space, being best positioned to ride the country’s consumption recovery theme due to its rich product pipeline over the next three years. 
 
The stock deserves a valuation premium due to superior growth prospects (31% EPS CAGR over the forecast period) and also because it is the sole listed proxy in the domestic car industry. 
 
<keyword id="111992" type="CITY" weightage="40" keywordseo="Oil-India-Ltd">Oil India Ltd</keyword>: Target price set at Rs 694 
 
Oil India (OIL) is a state-owned (67.6% stake) E&amp;P company with only onshore production and exploration mainly in north-east India. This region accounts for its entire crude oil and most of its gas production and reserves. 
 
Gas price hike drives a 41-59% YoY rise in FY15E EPS at a gas price of US$6.8-9.0/mmbtu. A rise in oil price net of subsidy drives 34-70% YoY growth in FY15E EPS. FY15E EPS would rise by 60-114% YoY if the prices of both oil &amp; gas increase. 
 
Risk-reward ratio is evenly balanced with the worst-case fair value implying around 30% potential downside, and the best-case fair value implying a potential upside of 16-39%. 
 
Voltas Ltd: Target price set at Rs 282 
 
Voltas, a Tata Group company, is India’s leading air conditioning and engineering services company. It operates in India through an extensive dealer and service network. Cyclical recovery in macro will drive stronger consumer discretionary sales, ie AC. 
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There will better construction demand as well. Sharp expansion of margin led by favourable product mix change will be drive 80% of the 27% earnings CAGR in FY14-17. The stock is cheaper relative to peers and is likely to rerate along with stronger growth. 
 
Analyst: S Ranganathan of LKP 
 
Dishman Pharma: Target price set at Rs 160 
 
Dishman Pharma is an integrated global outsourcing partner in CRAMS for innovator drug companies and derives close to 65 percent of its 1400cr revenues from CRAMS with marketable molecules forming the balance 35 percent of its revenues. 
 
With all its capital expenditure behind, the company has forward integrated its Vitamin-D facility and with a 24 percent sustainable EBIDTA margin we believe that it is now focused on de-leveraging its balance sheet having a debt of 850 cr. 
 
We recommend a BUY on the stock trading at 8x the current year's expected earnings with a price objective of 160. 
 
Zensar Technologies Ltd: Target price set at Rs 500 
 
Zensar Technologies is a Rs 2300-cr software company of the RPG group, which derives two-third of its revenues from ETS (enterprise transmission solutions) and one-third of its revenues from IM (infrastructure management). Zensar has the largest Oracle practice business in India and has a strong focus on digital transformation, which is primarily a consulting-oriented business. 
 
The company has consistently grown at a CAGR of more than 20 percent over the past 5 years both on top-line and bottom-line. Zensar (a debt-free entity) with a sustainable EBIDTA margin of more than 30 percent is well on its way to post a net profit of close to Rs 300 cr this fiscal. BUY with a price objective of Rs 500. 
 
ITNL: Target price set at Rs 250 
 
ILFS Transportation Network Ltd is a leading surface transportation infrastructure company belonging to the ILFS group. We believe that ITNL is the best proxy to play this theme not only in India, but also outside India and could be a prime beneficiary of the road development projects. 
 
This business is highly capital intensive and hence the high debt equity of 3x. ITNL with its 6500cr revenues is well placed to capitalize on the large addressable opportunity as it has attractive EBIDTA margins of 30 percent. Buy ITNL with a price objective of Rs 250. 
 
Escorts Ltd: Target price set at Rs 160 
 
Escorts with business interests in agricultural equipment, construction and railway equipment is the third largest player in tractors and is now launching new products in the mid to heavy segment of tractors and is aggressively foraying into the southern parts of the country where it lacks presence. 
 
The monsoon, although delayed, is expected to gather momentum in the next 3 months, which would also act as a positive trigger for the stock in the coming quarter. ESCORTS trading at 6.5x historical earnings should be bought with a price objective of 160. 
 
Federal Bank: Target price set at Rs 160 
 
Federal Bank was punished rather unjustly for its aggressive lending to the SME sector where it has seen fast traction and we believe that the markets have now factoring in the fact that its asset quality continues to be good with net NPA at 0.74% and provision coverage at a very healthy 84%. 
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The bank has a very healthy CASA of more than 30% and net interest margins are at a healthy 3.3% with branch expansion happening at a faster clip ( it now has 1175 branches) 
 
A quality private sector bank with an able leader available at a compelling price to book of 1.5x should be bought for a price objective of Rs 160. 
 
(Views and recommendations expressed in this section are the analysts’ own and do not represent those of EconomicTimes.com. Please consult your financial advisor before taking any position in the stocks mentioned.)

You Searched For "Voltas price inflation" and got 4 results

Voltas is telling analysts that it may hike AC prices by 3-4% to cover rising input costs

Navdeep Yadav

Your ACs, fridge and washing machines may get cheaper soon

Kritti Bhalla

Heatwave has turned ACs from a luxury to a necessity — but margins remain muted for the players

Kritti Bhalla

Budget 2014 No Cakewalk For Government, Says Expert; Top Ten Stocks To Buy

Economic Times

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