(Reuters) -India’s Blue Star reported a first-quarter profit that came in below expectations on Wednesday, as early arrival of the monsoon rains in parts of India reduced demand for air conditioners.
The cooling appliances maker reported a net profit of 1.21 billion Indian rupees ($13.80 million), down 28% from a year ago and below analysts’ average estimate of 1.35 billion rupees, according to data compiled by LSEG.
Revenue for the quarter ended June 30 rose 4.1% to 29.82 billion rupees, slower than the 28.7% growth a year ago.
KEY CONTEXT
Early monsoon rains, particularly in south India, led to tepid demand for summer-related products such as fizzy drinks, air coolers and fans during the quarter.
Blue Star’s revenue in its unitary products segment, which sells residential air-conditioners and has a roughly 50% share in revenue, fell 13.3%, due to “the early onset of monsoon and an overall mild summer, resulting in subdued demand,” Blue Star said in a press release.
Higher sales of commercial cooling systems, which make up 47% of revenue, to factories and data centers, however, cushioned some of the decline.
Its peer V-Guard also saw a dip in revenue due to lower sales in its consumer durables segment.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBI Price/ Revenue Profit Mean No. of Stock to price Div
TDA Sales growth (%) growth (%) rating* analyst target** yield
s (%)
Blue Star Ltd 49.25 32.10 15.19 18.77 Hold 18 1.03 0.51
Havells India Ltd 50.89 33.49 3.82 11.00 15.61 Buy 28 0.87 0.67
Crompton Greaves 29.85 19.31 2.26 10.73 17.44 Buy 31 0.75 0.93
Consumer
Electricals
Voltas 43.23 33.10 2.40 9.39 15.55 Buy 34 0.94 0.53
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
APRIL TO JUNE STOCK PERFORMANCE
— All data from LSEG
— $1 = 87.6880 Indian rupees
(Reporting by Ananta Agarwal in Bengaluru; Editing by Harikrishnan Nair and Sumana Nandy)
