Stock Of The Day: Voltas Hits Record After Peak AC Sales—Analyst Views, Key Levels To Watch
The stock rose as much as 13% during the day to a record high of Rs 1,392 apiece on the NSE.
Voltas Ltd. sold over 2 million air conditioners in the last financial year and said is the "highest-ever" sales of ACs by any brand in a financial year in India.
For many years, Voltas has been the undisputed market leader and remained the top player in the room air-conditioner category, consistently outperforming its closest competition.
"We would like to reiterate that none of our competitors within the category are anywhere close to where we stand today," Chief Executive Officer Pradeep Bakshi has said.
Key Levels To Watch
Resistance level: Rs 1,392 (Record high)
Support level: Rs 1,158 (Five-session low)
The stock rose as much as 13% during the day to a record high of Rs 1,392 apiece on the NSE on Monday. It was trading 8.72% higher compared to a 0.48% advance in the benchmark Nifty at 10:53 a.m.
Business Update
The Tata Group company posted a significant volume growth of 72% in AC sales in the March quarter and 35% for fiscal 2024, according to an exchange filing issued on Sunday.
The company's robust offline and online distribution network, high brand equity and creative new launches, along with the year-round demand for cooling products, were cited as contributing factors to the performance.
More Heat-Wave Days Than Usual
The India Meteorological Department has forecasted that there would be above-normal maximum temperatures in the April–June period over most parts of the country.
Around 10–20 days of heatwave are expected in different parts of the country against the normal of four–eight days, the IMD had said.
This will most likely increase the demand for room air conditioners in the country, bolstering the sales of Voltas.
Street Views
Nomura Research maintains a 'buy' rating on the stock with a target price of Rs 1,450 apiece. The brokerage maintains Voltas as its preferred pick in the sector and expects it to outperform the industry.
Nomura expects primary AC volumes to be at 7.5 lakh units, driving a 38% year-on-year growth in unitary cooling products. The projects business is likely to be up 37% YoY due to a low base.
Citi Research maintains a 'buy' rating and raised the target price to Rs 1,428 apiece from Rs 1,281 earlier. It raised the target P/E multiple to 51 times on strong AC demand in India.
