01 — At a Glance
The Electrical Giant That Lost 4% In A Month (But Management’s Cheerful)
- 52-Week High / Low₹1,674 / ₹1,250
- FY25 Revenue (Full Year)₹21,805 Cr
- FY25 PAT (Full Year)₹1,470 Cr
- Full-Year EPS (FY25)₹23.48
- Q3 FY26 EPS₹4.80
- Book Value₹138
- Price to Book9.76x
- Dividend Yield0.74%
- Debt / Equity0.03x
- Return Over 1 Year-7.62%
The Reality Check: Havells closed Q3 FY26 with ₹5,588 crore quarterly revenue (+14.3% YoY), ₹334 crore PAT (+20% YoY), and an exceptional item of ₹45 crore labour-code provisioning that inflated the reported profit. Strip that out? Normalized PAT closer to ₹289 crore. Annualized EPS lands at ₹19.2 against CMP ₹1,349—making the P/E not 55.7x but a more reasonable 70x. Still premium. Still expensive. The stock has delivered -7.62% over the past year while the company genuinely grew. Welcome to the world of multiple compression.
02 — Introduction
When A ₹84,000 Crore Giant Moves, The Electricity Market Shivers
Havells India is not new to anyone with a home. Cables in your walls? Likely Havells. Fans on your ceiling? Havells or Crompton—and your electrician will swear one is better than the other over chai. AC in your bedroom? Lloyd (which Havells owns). Switches and circuit breakers? Again, Havells built the majority of India’s electrical backbone since 1983.
The company is simultaneously two different stories: the boring, stable, profitable fast-moving electrical goods (FMEG) powerhouse, and a growth-obsessed cables juggernaut that’s doubling capacity every few years. In Q3 FY26, both stories collided into a single quarterly result that had investors asking—is this a compounding machine or a value trap in disguise?
Here’s the timeline. FY25 saw Havells hit all-time revenue of ₹21,805 crore (+17% YoY) and PAT of ₹1,470 crore. But growth has softened visibly in the nine months ended December 2025. Consumer demand is sluggish—air conditioners faced a genuinely awful monsoon-heavy summer. Cables are booming, but raw material prices (copper specifically) are acting like a margin tax. The company invested ₹600 crore into Goldi Solar (for module supply security). The stock has compressed from ₹1,674 to ₹1,349—a 19% haircut—despite fundamentals holding up.
Let’s find out what’s really true and what’s just management commentary delivered with conviction.
Concall Note (Jan 2026): “Cable is moving much faster than the other product categories. Disciplined spends supporting leverage.” Management’s happy. Investors are not. That gap is what we’re going to investigate.
03 — Business Model: The Two-Engine Paradox
Cables Boom. Everything Else? Lumpy.
Havells operates in six product segments, each with its own margin, cycle, and profitability story. The cable business is the workhorse—32% of FY25 revenue, growing at +14% YoY with volume expansion “over 20%” in double digits and commodity prices inflating the top line. Switchgears (11%), Lighting (8%), and Motors/Solar/Others (7%) are mature, capital-light, and stable. But then there’s Lloyd.
Lloyd is the AC and white goods division acquired to diversify beyond “boring electrical goods.” Lloyd was 24% of FY25 revenue, grew 35% YoY in FY25, but just reported a profit margin jump from 7.9% to 13.5%—suggesting heavy price increases in a weak demand environment. The company has 18,000+ dealers and 2.68 lakh retail outlets. Manufacturing footprint spans 16 locations. In-house manufacturing covers 90% of sales. On paper, it’s beautiful. On execution, it’s messy because commodities move faster than pricing.
Market share looks unbeatable: 10–15% in modular switches, lighting, cables, ACs; 15–20% in water heaters, MCBs, fans, wires. But “unbeatable” is a relative term when unorganized players are hungry and tariff-driven exports are contracting.
Cables32%Of FY25 Revenue
Lloyd (AC)24%White Goods Push
ECD / FMEG18%Fans & Heaters
Switchgears11%Industrial Focus
Capex Reality Check: Havells spent ₹1,200 crore in 9M FY26 (annualized ~₹1,600 crore). Management guided ₹800–900 crore annually for FY26–FY27. That gap exists because Lloyd’s Sri City facility is coming online and Tumkur cables capacity is under construction. Once done, capex normalizes—but growth capex will remain structural given cables demand outpacing installed capacity.
💬 Do you think Lloyd can sustain 13.5% margins, or will pricing power evaporate as demand normalizes? Drop your thought.
04 — Financials Overview
Q3 FY26: The Numbers With The Asterisk
Result type: Quarterly Results | Q3 FY26 EPS: ₹4.80 | Annualised EPS (Q3×4): ₹19.20 | Full-year FY25 EPS: ₹23.48
| Metric (₹ Cr) |
Q3 FY26
Dec 2025 |
Q3 FY25
Dec 2024 |
Q2 FY26
Sep 2025 |
YoY % |
QoQ % |
| Revenue | 5,588 | 4,889 | 4,779 | +14.3% | +16.9% |
| Operating Profit | 516 | 426 | 438 | +21.1% | +17.8% |
| OPM % | 9.2% | 8.7% | 9.2% | +50 bps | Flat |
| PAT (Reported) | 300 | 278 | 318 | +7.9% | -5.7% |
| Exceptional Items | 45 | — | — | Labour Code | Revaluation |
| EPS (₹) | 4.80 | 4.44 | 5.09 | +8.1% | -5.7% |
The Asterisk: Q3 FY26 PAT includes ₹45 crore labour-code provision (exceptional item). Normalized PAT is closer to ₹255 crore, implying a normalized EPS of ₹4.08. Annualized: ₹16.32. Yes, that’s materially lower. Operating profit grew 21.1% YoY, but PAT growth of +7.9% tells you that margins are under stress outside the topline. Copper is expensive. Channel inventory in cables is elevated. Lloyd is raising prices and hoping demand comes back. None of this is catastrophic—but it’s not euphoric either.
05 — Valuation: Fair Value Range
What’s ₹1,349 Really Worth?
Join 10,000+ investors who read this every week.
