Shares of Whirlpool of India Ltd. rebounded after some analysts said the company's revenue would improve once the industry stabilises. The stock had opened lower after the company's fourth-quarter net profit and revenue declined.
The net profit fell 30.09% to Rs 55.6 crore in the January-March quarter, while the revenue declined 2.82% to Rs 1,565.23 crore, as per an exchange filing.
"Despite near-term demand headwinds, we continue to believe Whirlpool's strong parentage and the recent action of launching new products across the range, taking a calibrated price correction in refrigerators, and double-digit growth in Elica will bode well for the company going forward," Yes Securities (India) Ltd. said while maintaining a 'buy' rating on the stock.
Whirlpool of India, Q4 FY23 (Consolidated, YoY)
Revenue down 2.82% at Rs 1565.23 crore.
Ebitda down 33.89% at Rs 89.81 crore.
Ebitda margin at 5.74% vs. 8.43%.
Net profit is down 30.09% at Rs 55.6 crore.
The board approved a final dividend of Rs 5 per share for the financial year 2022–23.
Shares of the company rose 0.26% to Rs 1355 apiece after having fallen 4.19% to Rs 1,291.60 apiece during morning trade on Thursday. This compares with a 0.16% gain in the benchmark S&P BSE Sensex.
The total traded quantity stood at 15.7 times the 30-day average volume.
Of the 17 analysts tracking the stock, nine maintain a 'buy', four suggest a 'hold', and four recommend a 'sell', according to Bloomberg data. The average 12-month consensus price target implies a potential upside of 5.3%.
What analysts have to say about the company
Yes Securities
Maintains 'buy' call with a target price of Rs 1,690, implying a potential upside of 25.4%.
Whirlpool’s consolidated revenue came in below house and consensus estimates, with revenue declining 2% YoY.
Revenue decline is attributed to muted market growth in refrigerators and air conditioners in Q4.
Margins were lower-than-expected due to lower sales owing to subdued market conditions and a calibrated price correction.
Gross margins on a stand-alone basis were stable despite lower pricing, which is a key positive.
Expects company to post strong revenue growth once the industry stabilises.
Says management is confident of the strong leverage of recent product launches in the mid- and premium-ranges.
This, combined with renewed market excellence and cost reduction, will help the company grow profitably.
Recent portfolio expansion of Elica is yielding good results.
Elica India's revenue is growing at double digits with healthy margins.
Whirlpool's strong parentage, new product launches, price correction in refrigerators, and double-digit growth in Elica will bode well going forward.
Builds in moderate estimates for FY24.
Prolonged demand slowdowns in key categories of refrigerators could pose a risk to house estimates.
Nirmal Bang Securities Pvt.
Maintains 'accumulate' and slashed the target price to Rs 1,375 from Rs 1,435.
Strong growth in Elica, offset by muted entry segment performance.
Bottomline declined due to lower sales amid subdued demand and calibrated price corrections.
The company offers structural growth opportunities in the long term, with the strongest balance sheet and cash flows.
Marginally tweaked numbers reflect demand pick-up in the entry segment, margin improvement going forward.
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