HAVELLS - Havells India

📊 NSE: HAVELLS 🏢 Electric Equipment 📅 Last Updated: 12/13/2025 22:50

💰 Financial Performance

Revenue Growth by Segment

Total Operating Income (TOI) grew 17% YoY in FY25 to INR 18,624 Cr. In H1FY26, Net Revenue was INR 10,204 Cr, a slight decline of 1.2% YoY. Segmentally, Wires saw mid-double-digit growth in H1FY26, while the Electrical Consumer Durables (ECD) segment experienced a 1.7% YoY degrowth due to lower demand for summer products. Lloyd has transitioned to positive profitability as of Q1FY25 after three years of losses.

Geographic Revenue Split

Havells operates across India with a presence in approximately 3,000 towns. While specific regional percentage splits are not disclosed, the company maintains a retail reach of 2.68 lakh outlets and 19,400 direct dealers, indicating a broad national footprint with increasing rural reach.

Profitability Margins

Operating margins moderated from 13.03% in FY22 to 9.78% in FY23 but recovered to 11.04% in Q1FY25. Net Profit for FY25 stood at INR 1,470 Cr with a Net Profit margin of 6.86%. H1FY26 Net Profit was INR 670 Cr, down 2.0% YoY from INR 684 Cr in H1FY25.

EBITDA Margin

EBITDA margin for Q2FY26 was 9.3%, up from 8.4% in Q2FY25. For H1FY26, EBITDA margin was 9.4% (INR 962 Cr) compared to 9.3% (INR 956 Cr) in H1FY25. Standalone Havells (excluding Lloyd) maintains higher EBITDA margins of 12-13%.

Capital Expenditure

The company spent INR 753 Cr on Capex in FY25. In H1FY26, Capex spend was INR 697 Cr, which includes the acquisition of a 39-acre land parcel in Alwar, Rajasthan, for cable capacity expansion and a strategic INR 600 Cr investment for a stake in Goldi Solar.

Credit Rating & Borrowing

Havells maintains a 'Stable' credit rating from CARE Ratings. The company is virtually debt-free with a Debt-Equity ratio of 0.00 (excluding lease liabilities). Total debt of INR 319 Cr as of March 31, 2025, consists entirely of lease liabilities, resulting in a low gearing of 0.05x.

⚙️ Operational Drivers

Raw Materials

Raw materials account for 68-70% of total revenue. Key materials include copper and aluminum (for cables/wires), steel, and electronic components for LED lighting and Lloyd appliances.

Import Sources

Not specifically disclosed in the documents, though the company mentions strategic supply chain acquisitions like Goldi Solar to secure components.

Capacity Expansion

Manufacturing is 90% in-house across 16 locations. Current expansion includes a new 39-acre facility in Alwar for cables. The Goldi Solar investment is intended to scale business volumes and improve the supply chain for solar components starting H2FY26.

Raw Material Costs

Raw material costs represent approximately 68-70% of revenue. Margins are sensitive to sharp fluctuations in commodity prices, which led to a moderation in contribution margins for cables and switchgear in FY25.

Manufacturing Efficiency

The company focuses on in-house manufacturing (90% of sales) to maintain quality and margins. Capacity utilization metrics are not explicitly provided, but production was scaled down in Q1 due to high inventory levels.

Logistics & Distribution

Distribution network includes 19,400 direct dealers. Advertising and sales promotion expenditure, which supports this distribution, was INR 622 Cr in FY25 (2.86% of revenue).

📈 Strategic Growth

Expected Growth Rate

10-13%

Growth Strategy

Growth is driven by premiumization (40% of fans are now BLDC), expansion into 'white spaces' in the consumer durable market, and increasing the share of Lloyd in the revenue mix. The company is also expanding cable capacity via the Alwar land acquisition and entering the solar supply chain through Goldi Solar.

Products & Services

Cables, wires, switchgear, LED lighting, fans (including BLDC), air conditioners, refrigerators, washing machines (Lloyd), and solar components.

Brand Portfolio

Havells, Lloyd, Crabtree, Standard, Reo.

New Products/Services

Focus on BLDC fans (40% of fan portfolio) and mass-premium ranges in the Lloyd portfolio. Solar business scale-up is expected from H2FY26.

Market Expansion

Expansion into 3,000 towns with a focus on increasing rural reach and strengthening the 'Others' segment through solar component manufacturing.

Market Share & Ranking

Market leader in multiple segments including organized fans and domestic switchgear. Specific market share percentages are not disclosed but are described as 'strong' and 'increasing'.

Strategic Alliances

Acquired a strategic stake in Goldi Solar for INR 600 Cr to secure the supply chain for solar products.

🌍 External Factors

Industry Trends

The industry is shifting toward energy-efficient products (BLDC fans) and premiumization. The consumer durable sector is seeing increased competitive intensity, particularly with new listings like LG, but Havells is positioned to counter this through brand strength and in-house manufacturing.

Competitive Landscape

High competitive intensity across all categories. Key competitors include LG (in Lloyd's segment) and other organized players in the FMEG space.

Competitive Moat

Moat is built on a massive distribution network (2.68 lakh outlets), strong brand equity across multiple price points (Reo to Crabtree), and 90% in-house manufacturing which provides better quality control and cost management.

Macro Economic Sensitivity

Sensitive to residential demand and construction cycles. Revenue is impacted by government fiscal policies, such as the recent GST reduction which is expected to uplift demand.

Consumer Behavior

Shift toward premium, branded, and energy-efficient products. Residential demand is showing signs of pickup, which favors the lighting and cable segments.

Geopolitical Risks

Exposure to global commodity price volatility for copper and aluminum, which are essential for the cable and wire segments.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to GST regulations (recent reduction noted) and Bureau of Energy Efficiency (BEE) norms for appliances like fans and ACs.

Environmental Compliance

The company integrates ESG into its triple bottom line management (economic, social, and environmental). Specific compliance costs are not disclosed.

Taxation Policy Impact

Effective tax paid in FY25 was INR 505 Cr. H1FY26 tax provision was INR 219 Cr.

⚠️ Risk Analysis

Key Uncertainties

Volatility in raw material prices (68-70% of costs) and the ability to pass on these costs in a highly competitive market. Potential for margin dilution if premiumization does not offset R&D and marketing spends.