1. At a Glance

Blue Star Ltd — the company that keeps your room cool but your portfolio sweating — reported anotherdecentquarter for Q2FY26. Consolidated revenue stood at ₹2,422 crore, up 6.43% YoY, while net profit hit ₹99 crore, up just 2.93%. The market cap sits at a comfortable ₹39,429 crore, with a stock price of ₹1,918 as of November 4, 2025.

The stock has delivered a modest 4.9% return in 3 months and a lukewarm 3.2% over a year, making it the equivalent of setting your AC at 27°C — not too cold, not too hot, but it works. With a P/E of 73.4 (yes, seventy-three), it’s priced like an Apple iPhone in a world of budget Androids. ROE remains impressive at 20.6%, and ROCE at 26.2% — meaning management squeezes efficiency out of every rupee like you squeeze toothpaste at the end of the tube.

Operating margins? A solid 7.1%, stable as a well-calibrated thermostat. And while sales are up 14.2% YoY, profit growth is crawling at just 2%. Still, Blue Star continues to be thecoolestmidcap in the room, literally and financially.

2. Introduction

If you ever doubted the power of air conditioning in Indian households, try spending a May afternoon in Nagpur. Blue Star knows this pain well — and monetizes it beautifully. Founded in 1943 and now a ₹39,000 crore behemoth, the company’s journey reads like an engineering student’s dream: start small, add ducts, add chillers, and end up owning every hotel lobby and IT office’s air system.

But here’s the twist: this “old money” HVAC legend now fights in the same retail aisles as Voltas, LG, and Daikin — with Virat Kohli selling you “cool performance.” The charm? A balanced business mix between big-ticket Electro-Mechanical Projects and your everyday Unitary Products like room ACs, air coolers, and water purifiers.

While Indian consumers are learning to pay EMI for everything from iPhones to iRoombas, Blue Star is busy ensuring your EMIs arecomfortably air-conditioned. Their goal? To make every middle-class Indian room chill — and every investor sweat over the valuation.

3. Business Model – WTF Do They Even Do?

Blue Star isn’t just about the AC in your bedroom. Think of it as India’s HVAC Swiss Army knife — air, water, and fire all under one mechanical umbrella.

Segment 1: Electro-Mechanical Projects (EMP)The backbone of Blue Star’s empire. This includes large central AC and ventilation projects, fire-fighting, water, plumbing, and electrical works. It’s where they serve corporate giants like Ola Electric, Wells Fargo, and Oberoi Realty. They even dabble in railway electrification — basically, if it’s big, industrial, and complicated, Blue Star will chill it.

Segment 2: Commercial Air ConditioningBlue Star rules the market in ducted systems and scroll chillers. They’re second in VRFs (Variable Refrigerant Flow systems, if you’re not an HVAC nerd). This segment brings prestige — the kind of projects that appear in glossy brochures at real estate expos.

Segment 3: Unitary ProductsThis is what you, the humble consumer, touch — ACs, air coolers, water purifiers, deep freezers, and commercial refrigeration units. Distributed across 8,800 outlets in 650+ locations, this segment brings 47% of revenue. Retail channel expansion in Tier-2/3 cities ensures every chai shop and sweet shop stays properly chilled.

Segment 4: Professional Electronics and Industrial Systems (PE&IS)A small but elite unit providing tech-heavy solutions in MedTech, Data Security, and Industrial Electronics. Basically, Blue Star’s nerdy cousin who loves sensors and calibration more than compressors.

In short, Blue Star makes money by cooling buildings, cooling people, and occasionally cooling nerves in boardrooms.

4. Financials Overview

Quarterly Comparison (₹ crore)

Annualised EPS = ₹4.82 × 4 = ₹19.3At CMP ₹1,918, the annualised