Havells India

The Q4FY17 performance of Havells came as a shocker – for the first time in seven quarters, the company a drop in net profit, that too a very sharp drop – 74% (YoY) fall at Rs.95 crore though its total income did surpass all estimates at Rs.1752 crore, up 18%.

Two reasons for this – firstly, in Q4, the company took a hit of Rs.77 crore as exceptional loss of which Rs.62 crore was an impairment loss on its investment in Havells Holdings and Rs.15 crore was due to the termination of the JV in Jiangsu Havells Sylvania Lighting Company. Secondly, in previous Q4, the company had an exceptional gain of Rs 202.39 crore thus giving it a higher base effect.

But for this, the performance was actually good. EBITDA rose 8% at Rs.271 crore while margins showed a drop from 16.88% to 15.5%.

For FY17, the company posted a 17% drop in consolidated total income at Rs.6751 crore and net profit dropped 62% at Rs.494 crore. Equity is at Rs.62.49 crore and EPS for the year is at Rs.7.90.  Good news – borrowings now stand at Rs.208 crore and interest outgo for the year has come by 75% to Rs.13 crore from Rs.54 crore earlier.