Johnson Controls-Hitachi Air Conditioning Q4 Results — Weak Quarter, Expect Muted Q1 FY24: Nirmal Bang

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Nirmal Bang ReportJohnson Controls-Hitachi Air Conditioning India (JCHAC) reported a disappointing 4QFY23 performance, with revenue down 21.1% YoY at Rs5.5bn. Cooling Products segment’s revenue declined by 21.7% YoY to Rs5.4bn (96.7% of total sales). Design & Development segment’s sales improved by 14.1% YoY to Rs182mn (3.3% of total sales). Gross margin expanded by 330bps YoY to 31.5%, most likely due to easing commodity cost pressures. EBITDA came in at Rs234mn, down 40.8% YoY. EBITDA margin contracted by 142bps YoY to 4.3%..Cooling Products segment’s EBIT margin contracted sharply by 239bps YoY to 0.9%. Design & Development segment’s EBIT margin expanded by 87bps YoY to 12.1%. For 4QFY23, JCHAC reported an exceptional expense of Rs24mn mainly on account of termination benefits paid/payable to employees due to realignment/reorganization in certain areas. JCHAC reported adj. net profit of Rs14mn in 4QFY23, down 91.7% YoY. We believe that demand moderated in March’23 on account of weak consumer sentiment and unseasonal rains after pick-up in mid-Feb’23..We expect demand to remain muted in 1QFY23 on account of unseasonal rains, weak consumer sentiment and high channel inventory across the industry. Margin headwinds for JCHAC are likely to persist over the near term. We continue to maintain ‘Under Review’ rating on JCHAC as we seek to better understand the company’s business..Click on the attachment to read the full report: .DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Johnson Controls-Hitachi Air Conditioning Q4 Results — Weak Quarter, Expect Muted Q1 FY24: Nirmal Bang

Johnson Controls-Hitachi Air Conditioning India Q4 Results - Weak Quarter; Expect Muted 1QFY24 : Nirmal Bang

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