Prabhudas Lilladher's research report onVoltas
We attended VOLT’s analyst conference call to discuss the outlook for RACs, commercial air-conditioning (CAC), commercial refrigeration (CR) and the company’s growth strategy. The management indicated that RAC demand remains healthy, with Q2FY27 industry growth expected at 15-20% YoY and VOLT expected to grow ahead of the industry. Supported by its low-cost inventory and market-share-focused strategy, VOLT’s market share reached 18.6% in Jul’26. YTD Jul’26 market share stood at 17.5% vs. 17.3% in Jun’26). The company continues to maintain a significant lead over the second-largest player, with a market share gap of ~6.4ppt. Channel inventory remains below 30 days. VOLT has taken two price hikes of 7% and 5%, driven by BEE changes and higher commodity/currency costs. Both RAC plants are currently operating at almost full capacity, limiting near-term margin benefits from improving utilization. The management expects cost optimization to be visible over the coming quarters.
We expect revenue/EBITDA/ PAT CAGR of 13.2%/31.7%/39.7% over FY26- 29E. We roll forward to Sep’28E, introducing FY29E earnings, and assign SoTP-based TP of INR1,258 (earlier INR1,308), based on 40x FY29E. Upgrade to ‘Accumulate‘ from ‘Hold’.
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