1. At a Glance
Blue Star Ltd is not just blowing cold air — it’s heating up with a multi-segment business empire spanning ACs, commercial refrigeration, turnkey MEP projects, and industrial electronics. With FY25 revenue at nearly ₹12,000 crore and a 5-year profit CAGR of 32%, this is your desi Daikin on steroids.
2. Introduction with Hook
If God had to build a smart city in India, Blue Star would probably get the HVAC contract. From chilling corporate boardrooms to powering railway electrification projects, Blue Star does it all — except maybe making your chai.
- Revenue (FY25): ₹11,968 Cr
- Net Profit (FY25): ₹591 Cr
- Promoters held just 36.47% as of Mar 2025 — retail loves it more than its own family heirlooms.
3. Business Model (WTF Do They Even Do?)
Blue Star’s business model is a delicious 4-course thali:
- Electro-Mechanical Projects (MEP) – Fire-fighting, water supply, HVAC, electrical — if it wires, pipes, or burns, Blue Star builds it.
- Commercial Cooling – Central AC, chillers, VRFs — major player in India’s sweaty commercial sector.
- Unitary Products – ACs, coolers, purifiers, deep freezers sold via 8,800+ outlets.
- PE&IS Segment – Industrial automation, data security, med-tech solutions…basically their geek squad.
4. Financials Overview
Revenue, Profit, OPM (₹ Cr)
| Year | Revenue | Net Profit | OPM % |
|---|---|---|---|
| FY21 | 4,264 | 101 | 6% |
| FY22 | 6,064 | 168 | 6% |
| FY23 | 7,977 | 401 | 6% |
| FY24 | 9,685 | 414 | 7% |
| FY25 | 11,968 | 591 | 7% |
- CAGR (Revenue 5Y): 17%
- CAGR (Profit 5Y): 32%
- Operating margin: Stable-ish at 6–7%
5. Valuation
Let’s run the valuation like a chilled airflow simulation:
- P/E: 63.6x (ouch, premium pricing alert!)
- EPS FY25: ₹28.75
- Historical Median P/E: ~45x
- Fair Value Range: ₹1,295 – ₹1,620 (assuming 45–56x P/E)
Yes, the current price of ₹1,800 may be the costliest cooler you’ve ever bought.
6. What’s Cooking – News, Triggers, Drama
- Added 150 new room AC models (how many do we need, really?)
- Arbitration claims slapped against it for ₹461 Cr — drama alert.
- Mohit Sud joins as Group President — leadership reshuffle.
- Commercial refrigeration business launched new deep freezers — from 60L to 600L.
- Clean tax order win & expanded to new assembly line = manufacturing scale-up mode: ON.
7. Balance Sheet
| Item | FY25 (₹ Cr) |
|---|---|
| Equity Capital | 41 |
| Reserves | 3,024 |
| Borrowings | 381 |
| Total Liabilities | 8,258 |
| Fixed Assets + CWIP | 1,659 |
| Investments | 432 |
| Other Assets | 6,167 |
Key Points:
- Debt-to-Equity: ~0.12 — comfortably cool.
- Reserves up 3x in 3 years.
- Asset-light for a manufacturing and EPC company? Color us impressed.
8. Cash Flow – Sab Number Game Hai
| Item | FY25 (₹ Cr) |
|---|---|
| Cash from Operations | 688 |
| Cash from Investing | -464 |
| Cash from Financing | -162 |
| Net Cash Flow | 62 |
Notes:
- Operating cash is solid.
- Aggressive capex continues.
- Dividend payout stable at 31%.
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROCE | 26% |
| ROE | 20.5% |
| Inventory Days | 86 |
| Debtor Days | 60 |
| CCC | 8 |
Interpretation:
Everything here screams efficient operator. Even with heavy MEP projects, the working capital is under control.
10. P&L Breakdown – Show Me the Money
| Year | Sales | OPM % | Net Profit | EPS |
|---|---|---|---|---|
| FY21 | 4,264 | 6% | 101 | ₹5.21 |
| FY22 | 6,064 | 6% | 168 | ₹8.71 |
| FY23 | 7,977 | 6% | 401 | ₹20.79 |
| FY24 | 9,685 | 7% | 414 | ₹20.18 |
| FY25 | 11,968 | 7% | 591 | ₹28.75 |
11. Peer Comparison
| Company | P/E | ROCE | EPS (₹) | Market Cap (₹ Cr) |
|---|---|---|---|---|
| Blue Star | 63.6 | 26% | 28.75 | 37,007 |
| Voltas | 55.0 | 17.6% | 20.73 | 45,314 |
| Amber Ent. | 103.8 | 14.4% | 29.85 | 25,298 |
| Crompton | 38.9 | 19.0% | 12.03 | 21,610 |
Verdict:
Blue Star isn’t the cheapest AC stock — but arguably the best insulated. Performance > valuation here.
12. Miscellaneous – Shareholding, Promoters
| Shareholder Type | Mar 2025 |
|---|---|
| Promoters | 36.47% |
| FIIs | 16.94% |
| DIIs | 23.13% |
| Public | 23.44% |
- FII shareholding doubled in 2 years = global smart money is in.
- Promoters diluted — not necessarily bad, but watch further activity.
13. EduInvesting Verdict™
Blue Star is a rare Indian mid-cap that acts like a grown-up. Solid financials, diversified revenue, capital efficiency, and expanding product lines make it one of the few “everything store” plays in the HVAC + MEP ecosystem.
It’s not cheap. It may never be cheap. But it’s possibly the coolest compounder in the consumer-engineering jungle — pun 100% intended.
Metadata
– Written by EduInvesting Research | 13 July 2025
– Tags: Blue Star, HVAC, Consumer Durables, Capex, Smart Money
