1. Opening Hook
Diwali lights were on, but Havells’ summer products clearly missed the sunshine. The fans cooled off, air conditioners caught a cold, and even the CFO’s spreadsheets needed a fan to keep cool. While cables were flexing muscles and LED lights found a faint glow, the Lloyd business was busy offering discounts big enough to light up Delhi.
By the end of it, management sounded like they were praying for longer summers and shorter inventory lists. Stick around — the real fun begins when “premiumization” meets “inventory liquidation.”
2. At a Glance
- Revenue up ~6% YoY– A “decent” performance, said management — like calling vada pav a balanced meal.
- EBITDA flat– Profits went on a vacation, didn’t inform HR.
- Margins down ~100 bps– Heat’s missing, but cost pressures aren’t.
- Cable business shining– Power cables turned into Havells’ main power source.
- ECD (Fans & Appliances) down ~2%– Coolers got cooler… in sales too.
- Stock down 3% post-call– Traders heard “inventory,” skipped “normalizing by Q3.”
3. Management’s Key Commentary
“Summer products experienced weakness with shorter summer and higher channel inventories.”(Translation:Weather report sponsored by Havells. Blame the sun, not the strategy. 🌞)
“Cables maintained steady growth momentum, driven by power cables.”(Translation:When ACs flop, cables carry the company — literally.*)
“We have acquired 39 acres adjacent to Alwar facility for expansion.”(Translation:New land to park old inventory.*)
“Lloyd’s contribution margin declined due to customer support schemes.”(Translation:Discounts are now officially part of the business model.*)
“GST cuts on ACs, TVs, and solar are positive.”(Translation:Government tried to help; market said ‘meh’.*)
“Premiumization continues to be our focus.”(Translation:Fancy name for selling fans with Bluetooth.* 😏)
“We are confident of margin improvement by Q4.”(Translation:Hope is not a strategy, but it’s free.*)
4. Numbers Decoded
| Metric | Q2 FY26 | YoY Change | One-Line Analysis |
|---|---|---|---|
| Revenue | ₹4,210 Cr | +6% | Growth led by cables; ECD dragged down. |
| EBITDA | ₹490 Cr | 0% | Flat line; cable gains offset summer blues. |
| EBITDA Margin | 11.6% | -100 bps | Sun went missing, so did margin shine. |
| Net Profit | ₹370 Cr | +1% | Survived via cables & cost control. |
| Cables & Wires Revenue | ₹1,930 Cr | +12% | Power cables remain Havells’ muscle. |
| ECD (Fans, Appliances) | ₹1,250 Cr | -2% | Fans took a fan break. |
| Lighting & Fixtures | ₹810 Cr | +4% | LED price stability gave faint light. |
| Lloyd (Consumer Durables) | ₹600 Cr | -6% | Discounts galore, profits no more. |
| Working Capital Days | 82 days | +15 days | Inventory doing yoga — stretching too much. |
Summary:Cables saved the quarter. Lloyd spoiled the mood. Havells’ Q3 now depends on weather apps, not strategy decks.
5. Analyst Questions
Equirus Capital:“How bad is Lloyd inventory?”→Mgmt:“Normalizing by Q3.”(Translation:Currently, it’s chaos.*)
PhillipCapital:“ECD degrowth?”→Mgmt:“Fans mid-single digit down, but water heaters growing.”(Translation:When in doubt, add a geyser.*)
ICICI Securities:“Post BEE rating change, can you raise prices?”→Mgmt:“We’ll pass on costs to consumers.”(Translation:Blame the Bureau, charge the buyer.*)
Nomura:“Switchgear margins range?”→Mgmt:“37–40%.”(Translation:Depend on which switch you flip.*)
Goldman Sachs:“Cost rationalization?”→Mgmt:“Focusing on productivity.”(Translation:Hiring freeze but calling it efficiency.*)
6. Guidance & Outlook
Management painted Q3–Q4 as the return of the sun. Inventory normalization by December, better secondary sales,
