22 January 2018
Q3FY18 Results Update | Sector: Capital Goods
Havells India
Buy
BSE SENSEX
35,798
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm
Free float (%)
S&P CNX
10,966
HAVL IN
Operating performance marginally below expectations
625
Performance impacted by weakness in Cables & Wires:
Revenue grew
345.0 / 5.3
30.5% YoY to INR19.7b (est. of INR20.3b) in 3QFY18. Operating profit of
575/396
INR2.6b (+37.5% YoY) too was below our estimate of INR2.8b. Revenue
-5/10/5
came in below estimate due to a miss in the Cables & Wires segment. Adj.
691
PAT of INR1.7b (+29.4% YoY) was marginally below our estimate of INR1.8b.
38.4
CMP: INR552
TP: INR640 (+15%)
Financials & Valuations (INR b)
Y/E Mar
Net Sales
EBITDA
Adj PAT
Adj EPS (INR)
EPS Gr. (%)
BV/Sh(INR)
RoE (%)
RoCE (%)
P/E (x)
P/BV (x)
2018E
82.6
10.4
7.1
11.4
19.4
59.0
19.4
19.5
48.4
9.4
2019E
99.7
13.2
8.7
13.9
21.6
66.9
20.8
21.3
39.8
8.3
2020E
116.0
16.2
10.8
17.2
24.1
76.7
22.5
23.4
32.0
7.2
Estimate change
TP change
Rating change
Core business (ex-Lloyd) witnesses robust growth across segments, barring
Cables & Wires:
Core business revenue grew 11% YoY to INR16.7b (+14%
YoY, adjusted for excise impact on exempted zones), below our estimate of
INR17.2b, due to a weak performance from Cables & Wires (+3% YoY).
Operating profit rose 33% YoY to INR2.5b and EBIDTA margin improved
250bp YoY to 15.2%, driven by a) margin improvement across product
categories, as demonetization-related schemes were discontinued, b) price
hikes taken to compensate for higher raw material cost and c) low ad spend
(3.2% v/s 3.5% in 3QFY17).
Lloyd’s consumer business grows 16% YoY:
The recently acquired Lloyd
business recorded revenue of INR2.9b (+16% YoY). Operating profit stood at
INR480m and EBIDTA margin at 2.9%. Margin shrunk to 3% led by a)
inventory (old-EER stock) pushed to dealers at lower prices prior to
implementation of new norms and b) higher advertising costs at 9% of sales.
Working capital cycle contraction led by increase in payable days:
Core net
working capital cycle contracted to -14 day from 30 days in 3QFY17. During
the quarter, creditor days were up to 104 from 42 in 3QFY17 due to vendor
financing and extended credit cycle provided by Lloyd’s vendors.
Valuation and view:
We raise our earnings estimate for FY20 by 3% to factor
in better-than-estimated operating margins, driven by cost-control
measures. We maintain our
Buy
rating and raise our TP to INR640, with exit
multiple of 37x Mar’20E EPS of INR17.2.
FY18
FY17 FY18E MOSL
2Q
3QE
4QE
3QE
17,774 19,658 26,592 61,353 82,629 20,285
22.4
30.5
55.5
14.1
34.7
34.7
2,569 2,622 3,227 8,241 10,384 2,756
26.3
37.5
40.6
9.2
26.0
44.5
14.5
13.3
12.1
13.4
12.6
13.6
349
363
266 1,196 1,314
320
67
55
94
122
250
70
287
278
138 1,343 1,050
100
-
210
-
0.0
2,440 2,482 3,005 8,266 9,870 2,466
730
748
777 2,298 2,744
690
29.9
30.1
25.9
27.8
27.8
28.0
1,710 1,944 2,228 5,969 7,126 1,775
17.3
68.9 135.2
17.1
19.4
16.1
1,710 1,734 2,228 5,969 7,126 1,775
17.3
29.4
29.9
16.9
19.4
32.5
Quarterly Perf. (Standalone)
Y/E March
Sales
Change (%)
Adj EBITDA
Change (%)
Adj EBITDA margin (%)
Depreciation
Interest
Other Income
Extra-ordinary Items
PBT
Tax
Effective Tax Rate (%)
Reported PAT
Change (%)
Adj PAT
Change (%)
1Q
14,668
17.1
2,004
23.7
13.7
280
16
314
-
2,022
567
28.0
1,456
36.3
1,456
22.2
FY17
2Q
3Q
4Q
14,522 15,060 17,102
8.7
13.2
17.2
2,034
1,907
2,296
7.6
4.0
3.5
14.0
12.7
13.4
308
301
308
19
15
71
323
286
419
-
(190)
(768)
2,030
1,877
2,337
572
537
622
28.2
28.6
26.6
1,458
1,151
947
22.0
-4.0
-74.1
1,458
1,340
1,715
21.1
13.3
5.0
(INR Million)
Var.
1Q
18,605
26.8
1,724
-14.0
9.3
336
34
348
-
1,703
489
28.7
1,214
-16.6
1,214
-16.6
-3.1%
-4.8%
0.7%
9.5%
-2.3%
Ankur Sharma – Research Analyst
(Ankur.VSharma@MotilalOswal.com); +91 22 6129 1556
Amit Shah – Research Analyst
(Amit.Shah@MotilalOswal.com); +91 22 6129 1543
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

Havells India
3QFY18 operational performance marginally below our estimates
Revenues grew 30.5% YoY to INR19.7b in 3QFY18, below our estimate of
INR20.3b, on account of lower-than-estimated revenue in Cables & Wires
segment. The key business segment Cables & Wires registered 3% YoY revenue
growth to INR6.3b and Wires segment registered robust growth of 17% YoY.
However, Cables segment registered a decline, as order finalization got delayed
due to commodity price volatility and GST transition. Switchgear revenue
(adjusted for excise) registered 11% growth YoY. Lighting segment grew 21%
YoY, whereas Electrical Consumer Durables segment registered 26% growth YoY,
driven by strong performance from the fans and water heater segments.
Gross margin expanded 40bp YoY to 39.7%, as the company has been able to
pass on the cost increase to end-consumers.
EBITDA margin expanded 60bp YoY to 13.3% (v/s est. of 13.6%). Adspend stood
at 4% of sales (3.5% in 3QFY17).
HAVL’s 3QFY18 adjusted PAT at INR1.7b (+29.4% YoY) was marginally below our
estimate of INR1.8b. The miss on PAT was on account of higher-than-estimated
tax rate during the quarter (30.1% v/s est. of 28%).
Segmental performance: Demand recovery witnessed post GST transition
Switchgears (adj. for excise) witnessed growth of 11% YoY to INR3.4b, led by
pick-up in the switches segment. Switchgears demand continues to remain
subdued due to weak construction activity. Contribution margin improved
110bp to 40.1%, led by better mix in the quarter.
Electrical Consumer Durables registered strong growth of 33% YoY to INR4.2b,
led by improved performance in the fans appliances and water heaters
segments. 60% of revenue contribution came from fans, while 40% came from
the appliances and water heater segments. Contribution margin improved
500bp YoY to 29.6%, led by better utilization of the water heater facility.
Lighting division sales registered strong growth of 21.0% YoY to INR2.9b, led by
strong pick-up in demand across consumer and professional business. B2B
currently forms very small portion of the overall segment; however, Havells
intends to increase the share to 33%. Lighting contribution margin improved
150bp YoY to 28.5%.
Cable & Wires revenues registered growth of 3% YoY to INR6.3b. Volumes in the
Cables segment registered decline, as a) project business saw slowdown on
volatile commodity prices and b) consumers delayed buying till November since
GST rates were to be cut. However, with the GST rate being brought down to
18%, underground cables are expected to register strong volume growth from
4QFY18.
Recently acquired Lloyd business registered revenue of INR2.9b (+16% YoY).
Operating profit stood at INR85m and EBIDTA margin at 2.9%.Margin decline
was on account of a) inventory pushed to dealers at lower prices for old EER
stock prior to new norms and b) higher advertising costs at 9% of sales. Lloyd
has now entered into a tie-up with MBO’s like Croma and Reliance, and expects
to increase penetration with regional MBO so as to increase customer touch
points.
22 January 2018
2

Havells India
Exhibit 1: Revenues improved 31% YoY marginally below
estimates on account of weak revenue contribution from
Cables & Wires
Standalone Sales (INR b)
25
18
13 12
2
22
12 12
21
Growth- YoY (%)
27
16
5
3 -2
-2
7 8
1713
9
17
22
31
Exhibit 2: EBIDTA margin improvement driven by
improvement in Cables & Wires
EBITDA (INR m)
EBITDA Margin (%)
Source: Company, MOSL
Source: Company, MOSL
Exhibit 3: Segmental performance (INR m)
Y/E March
Sales
Switchgear
Cables & Wires
Consumer Durable
Lighting & Fixtures
Others
Lloyd
% YoY
Switchgear
Cables & Wires
Consumer Durable
Lighting & Fixtures
Profit Contribution
Switchgear
Cables & Wires
Consumer Durable
Lighting & Fixtures
Others
Lloyd
Contribution Margin (%)
Switchgear
Cables & Wires
Consumer Durable
Lighting & Fixtures
Others
Lloyd
FY16
3Q
4Q
3,401
6,785
3,092
2,406
1Q
3,529
5,330
3,514
1,962
334
FY17
2Q
3,474
5,592
3,085
2,371
-
-
0
(11)
21
15
1,445
793
821
631
-
3Q
3,459
6,829
3,436
2,496
-
4Q
3,913
7,601
3,970
2,399
432
1Q
3,557
7,196
3,676
2,176
545
2,672
(3)
19
2
5
1,441
875
951
635
96
394
36.8
11.5
24.0
26.5
22.1
15
FY18
2Q
3,299
5,693
3,216
2,868
-
2,698
(5)
2
4
21
1,363
1,133
894
775
-
527
41
20
28
27
-
20
3Q
3,443
6,256
4,158
2,871
6,930
(0)
(8)
21
15
1,380
1,070
1,230
818
-
480
40
17
30
28
-
16
3,402
5,817
2,888
2,209
3.9
17.5
25.1
13.9
1,302
732
727
543
11.3
19.2
7.8
28.0
1,269
884
852
559
20.2
4.9
21.1
22.1
1,435
719
913
513
79
2
17
19
13
1,291
869
809
696
15.1
12.0
28.4
-0.3
1,441
875
951
635
96
38.3
12.6
25.2
24.6
37.3
13.0
27.6
23.3
40.7
13.5
26.0
26.2
23.7
42
14
27
27
-
-
37
13
24
28
-
36.8
11.5
24.0
26.5
22.1
Source: MOSL, Company
Exhibit 4: Segmental growth adjusted for Excise on YoY basis
Switchgears
Cables
Lighting and Fixtures
Electrical consumer durables
Sub total
Lloyd
Total
3QFY17
3,309
6,092
2,363
3,296
15,060
-
15,060
3QFY18
3,443
6,256
2,871
4,158
16,728
2,930
19,658
Gr. YoY (% change)
11
3
21
33
14
34
Source: MOSL, Company
22 January 2018
3

Havells India
Exhibit 5: Brief Financial snapshot of Havells and Lloyd’s Half yearly performance
Havells
9MFY17
Net Revenue
Contribution
Contribution Margin
Ad and sales promotion
as a % to sales
EBIDTA
as a % to sales
Profit before tax
Tax
Net profit
44,250
11,013
24.9
1502
3.4
5,945
13.4
6,120
1,676
4,444
9MFY18
47,737
12,410
26
1428
3
6,514
13.6
6,406
10
20bps
5
-5
Change
YoY (%)
8
Lloyd
9MFY18
8,300
1401
16.9
602
7.3
402
4.8
429
-
-
consolidated
9MFY18
56,037
13,811
24.6
2,030
3.6
6,916
12.3
6,835
1,967
4,868
Source: Company, MOSL
Concall highlights
Overall business environment – revival seen across most segments
+14% YoY growth for Havells; in the medium term, growth will sustain at mid-
teens.
Margins have improved across categories to 15.2%, as demonetization schemes
were discontinued and RM-related hikes were taken; margins to be in the 14-
15% range.
GST stabilization has happened – rate cuts in November were passed on to
consumers immediately; seeing benefits of GST rate cuts across electricals. 8%
price reduction post the GST rate cuts in November 2017.
Lighting and ECD also doing well; switchgear and domestic wires too starting to
see good revival.
Advertising spend – 3QFY18 saw normal spending (4%), which will continue;
3QFY17 ad spends (3.5%) were curtailed due to demonetization.
Switchgears (+11% LTL sales driven by switches)
11% growth in 3QFY18, driven by switches. Expect better growth in the coming
quarters. Slow growth in switchgear on weak construction demand.
Coming from a flat to negative base for a few quarters, it is now moving to
single-digit growth. Construction is still challenging, but HAVL doing better on
new product launches.
Cables & Wires (+17% value growth in Wires, Cables declines)
Growth slowdown in cables: a) Project business saw a slowdown on volatile
commodity prices. b) Consumers delayed buying till November since GST rates
were to be cut.
Underground cables (B2B) - slow orders due to higher GST in June. With rate
cuts to 18%, expect strong volume growth in Q418.
2Q18 had gains on inventory, but 3Q18 has been a normalized quarter; margins
to sustain in the 16-17% range going forward.
Volume growth at Wires is flat, while cables has declined in low-single-digit.
22 January 2018
4

Havells India
Electronic Consumer Durables (+33% YoY with growth across fans, water
heater and appliances)
Margins in ECD category improved sequentially (30% in Q318 from 28% in Q218)
due to higher capacity utilization at factory level for water heaters.
Fans is the largest category and grown well – had a slight base effect from
demonetization and also stocking by dealers with growth across categories.
Havells focused on premium models and this is helping growth (66% of sale from
premium fans).
Water heaters also has grown very well - are in the top 3 players.
Lighting and fixtures (+21% YoY in Q318)
Growth driven by initiatives on B2B sales, LED switchover, winning large B2B
projects in commercial projects. This will continue to grow for the next 5 years.
B2B sales are small now, but target is to make it 33% of sales.
LED is 80% + in the lighting segment; all growth coming from this segment.
Lloyd Electric +16% YoY growth in Q318 and margin at 3%
Margins shrunk to 3% on the back of a) Inventory pushed to dealers at lower
prices for old EER stock prior to new norms and b) Higher advertising costs at 9%
of sales.
Q318 did see a preponement of sales from all brands; this may impact Q419
sales in Jan-Feb18; competition was clearing out stock in Q3 and so Lloyd too
had to take price correction to sell stock to dealers.
Ready with the new models and these have rolled out to the dealers as well.
Pricing has not been changed materially v/s competition – have passed all cost
increases on EER to consumer (8-10% increase).
Started with national chains like Reliance and Croma, along with regional chains
as well. Wants brand to be available with all customers.
Valuation and view: Maintain Buy with revised target price of INR640
We raise our earnings estimate for FY20 by 3% to factor in better-than-estimated
operating margins driven by cost-control measures. We maintain our
Buy
rating and
raise our TP to INR640, with exit multiple of 37x Mar’20E EPS of INR17.2.
Exhibit 6: Change in estimates
Description
Sales
EBITDA
Margin(%)
PAT
FY17
61,353
8,241
13.4%
5,969
New estimates
FY18
FY19
82,629
99,711
10,384
13,230
12.6%
13.3%
7,126
8,668
FY20
116,010
16,198
14.0%
10,757
Old estimates
FY18
FY19
83,240
100,407
10,675
13,573
12.8%
13.5%
7,192
8,908
FY20
114,677
15,806
13.8%
10,482
Change in estimates
FY18
FY19
FY20
-1%
-1%
1%
-3%
-3%
2%
-0.3%
-0.2%
0.2%
-1%
-3%
3%
22 January 2018
5

Havells India
Operating metrics
INR M
Havells Standalone
Revenues
Swtichgear
Cables and wire
Electrical Consumer Durables
Lighting and Fixtures
Others
Lloyd Electric
Total
Revenue Growth (% YoY)
Swtichgear
Cables and wire
Electrical Consumer Durables
Lighting and Fixtures
Lloyd Electric
Total
EBIT Margin (%)
Swtichgear
Cables and wire
Consumer Durables
Lighting and Fixtures
Lloyd Electric
Standalone EBIT (%)
Consolidated EPS (INR/sh)
Standalone
Sylvania
Total
FY13
FY14
FY15
FY16
FY17
FY18E
FY19E
FY20E
10,781
16,925
7,893
6,652
-
42,250
12,192
19,264
8,534
7,207
-
47,197
12,790
21,904
10,283
7,410
-
52,387
13,346
24,595
11,436
8,377
-
57,754
14,677
26,756
14,199
8,945
1,283
65,860
14,236
28,094
15,335
11,181
-
15,000
83,846
15,660
32,308
17,635
12,858
-
21,250
99,711
17,226
37,154
20,280
14,787
-
26,563
116,010
20.3
6.2
38.0
20.0
16.9
13.1
13.8
8.1
8.3
11.7
4.9
13.7
20.5
2.8
11.0
4.3
12.3
11.2
13.1
10.2
10.0
8.8
24.2
6.8
14.0
-3.0
5.0
8.0
25.0
0.0
27.3
10.0
15.0
15.0
15.0
15.0
18.9
10.0
15.0
15.0
15.0
25.0
16.3
33.9
9.1
25.1
23.6
11.5
6.0
0.9
6.9
36.5
11.0
27.0
24.8
13.1
8.2
0.5
8.7
36.5
12.1
25.1
26.6
12.5
7.7
0.5
8.3
37.5
12.6
25.0
22.8
13.4
8.2
0.0
8.2
38.2
12.2
24.6
26.4
13.7
9.6
0.0
9.6
39.5
16.2
27.0
28.0
17.0
12.2
11.4
0.0
11.4
40.5
16.2
26.5
28.0
18.0
12.7
13.9
0.0
13.9
40.5
16.2
26.0
28.0
19.0
13.5
17.2
0.0
17.2
22 January 2018
6

Havells India
Financials and valuations
Income Statement (Consolidated)
Y/E March
Net Sales
Change (%)
Raw Materials
Staff Cost
Other Expenses
EBITDA
% of Net Sales
Depreciation
Amortization
Interest
Other Income
PBT
Tax
Rate (%)
Extra-ordinary Inc.(net)
Reported PAT
Change (%)
Adjusted PAT
Change (%)
2014
81,858
12.9
46,398
10,869
17,167
7,425
9.1
1,155
741
413
5,941
1,478
24.9
0
4,463
-23.3
5,410
26.1
2015
85,694
4.7
48,292
11,875
18,316
7,211
8.4
1,387
640
504
5,689
1,836
32.3
0
3,853
-13.7
5,159
-4.6
2016
53,783
-37.2
31,735
3,708
10,791
7,549
14.0
1,049
127
694
7,066
1,970
27.9
2,024
7,120
84.8
5,096
-1.2
2017
61,353
14.1
36,485
5,004
11,623
8,241
13.4
1,196
122
1,343
8,266
2,298
27.8
(578)
5,390
-24.3
5,969
17.1
2018E
82,629
34.7
51,643
6,555
14,047
10,384
12.6
1,314
250
1,050
9,870
2,744
27.8
0
7,126
32.2
7,126
19.4
2019E
99,711
20.7
62,319
7,211
16,951
13,230
13.3
1,398
250
800
12,382
3,715
30.0
0
8,668
21.6
8,668
21.6
(INR Million)
2020E
116,010
16.3
72,158
7,932
19,722
16,198
14.0
1,481
250
900
15,367
4,610
30.0
0
10,757
24.1
10,757
24.1
Balance Sheet (Consolidated)
Y/E March
Share Capital
Reserves
Net Worth
Loans
Deffered Tax Liability
Minority Interest
Capital Employed
Gross Fixed Assets
Less: Depreciation
Net Fixed Assets
Capital WIP
Goodwill
Curr. Assets
Inventory
Debtors
Cash & Bank Balance
Loans & Advances
Other Current Assets
Current Liab. & Prov.
Creditors
Other Liabilities
Provisions
Net Current Assets
Misc. Expenses
Application of Funds
2014
624
16,036
16,660
10,506
517
1
27,687
32,075
20,451
11,624
444
4,380
36,929
14,934
10,005
8,819
2,114
1,057
25,690
9,988
12,684
3,018
11,239
0
27,687
2015
622
17,557
18,180
4,191
434
1
22,808
30,298
18,469
11,829
383
3,581
32,519
13,663
6,232
7,775
1,723
3,127
25,504
8,338
13,645
3,521
7,015
0
22,808
2016
625
28,912
29,537
444
863
0
30,844
13,080
1,200
11,881
205
0
24,077
7,844
1,576
13,652
0
1,005
10,047
4,363
4,062
1,621
14,031
0
30,843
2017E
625
32,111
32,736
1,981
1,138
0
35,854
15,012
2,355
12,658
119
0
32,797
9,284
2,285
19,375
0
1,853
13,746
6,296
5,685
1,766
19,051
0
35,854
2018E
625
36,184
36,809
1,000
1,138
0
38,947
16,012
3,669
12,344
0
14,970
28,219
13,636
3,077
9,732
0
1,774
16,586
8,479
6,253
1,854
11,633
0
38,947
2019E
625
41,139
41,764
1,000
1,138
0
43,901
17,012
5,066
11,946
0
14,970
36,042
16,455
3,714
14,011
0
1,863
19,057
10,232
6,878
1,947
16,985
0
43,901
(INR Million)
2020E
625
47,287
47,912
500
1,138
0
49,550
18,012
6,548
11,464
0
14,970
44,630
19,145
4,321
19,208
0
1,956
21,514
11,904
7,566
2,044
23,115
0
49,550
22 January 2018
7

Havells India
Financials and valuations
Ratios
Y/E March
Basic (INR)
Adjusted EPS
Growth (%)
Cash EPS
Book Value
DPS
Payout (incl. Div. Tax.)
Valuation (x)
P/Sales
P/E (standalone)
P/E (consolidated)
Cash P/E
EV/EBITDA
EV/Sales
Price/Book Value
Dividend Yield (%)
Profitability Ratios (%)
RoE
RoCE
RoIC
Turnover Ratios
Debtors (Days)
Inventory (Days)
Creditors. (Days)
Asset Turnover (x)
Leverage Ratio
Debt/Equity (x)
2014
7.2
8.7
26.1
10.5
26.7
3.0
49.1
2015
6.2
8.3
-4.7
10.5
29.1
2.9
57.6
2016
11.4
8.2
-1.2
9.8
47.3
4.0
88.5
6.4
67.6
67.6
56.1
43.3
6.1
11.7
0.7
32.5
19.2
33.2
45
67
45
3.0
0.6
28.4
17.0
38.8
27
58
36
3.8
0.2
17.3
19.3
52.1
11
53
30
1.7
0.0
2017
8.6
9.6
17.1
11.5
52.4
3.5
42.8
5.6
57.7
57.7
48.1
39.2
5.3
10.5
0.6
18.2
18.2
56.6
14
55
37
1.7
0.1
2018E
11.4
11.4
19.4
13.5
59.0
4.2
42.8
4.2
48.4
48.4
40.8
32.4
4.1
9.4
0.8
19.4
19.5
31.0
14
60
37
2.1
0.0
2019E
13.9
13.9
21.6
16.1
66.9
5.1
42.8
1.7
39.8
39.8
34.2
25.1
3.3
8.3
0.9
20.8
21.3
39.6
14
60
37
2.3
0.0
2020E
17.2
17.2
24.1
19.6
76.7
6.3
42.8
1.5
32.0
32.0
28.2
20.1
2.8
7.2
1.1
22.5
23.4
48.5
14
60
37
2.3
0.0
Cash Flow Statement
Y/E March
PBT before EO Items
Add : Depreciation
Interest
Less : Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
EO Income
CF from Oper. incl. EO Items
(Inc)/Dec in FA
Free Cash Flow
(Pur)/Sale of Investments
CF from Investments
(Inc)/Dec in Net Worth
(Inc)/Dec in Debt
Less : Interest Paid
Dividend Paid
CF from Fin. Activity
Inc/Dec of Cash
Add: Beginning Balance
Closing Balance
E: MOSL Estimates
2014
5,941
1,155
741
1,891
2,453
8,399
0
8,399
-1,424
6,975
0
-2,109
3
722
741
2,190
-2,206
4,084
4,736
8,820
2015
5,689
1,387
639
1,836
3,180
9,058
0
9,058
-1,531
7,528
0
-732
-198
-6,315
640
2,219
-9,372
-1,045
8,819
7,774
2016
7,066
1,045
127
1,970
-1,138
5,131
2,024
7,155
-922
6,233
-4,727
-2,069
9,177
-3,747
127
4,511
791
5,878
7,775
13,652
2017E
8,266
1,196
122
2,298
865
8,151
-578
7,573
-2,049
5,524
701
-1,348
640
1,537
122
2,557
-502
5,723
13,652
19,375
2018E
9,870
1,314
250
2,744
-2,388
6,302
0
6,302
-718
5,583
4,026
-11,662
0
-981
250
3,053
-4,283
-9,644
19,375
9,732
2019E
12,382
1,398
250
3,715
-1,073
9,242
0
9,242
-1,000
8,242
0
-1,000
0
0
250
3,713
-3,963
4,279
9,732
14,011
(INR Million)
2017E
15,367
1,481
250
4,610
-932
11,556
0
11,556
-1,000
10,556
0
-1,000
0
-500
250
4,608
-5,358
5,198
14,011
19,208
22 January 2018
8

Havells India
Corporate profile
Company description
Havells India is one of the largest electrical
companies in India, and also has a presence in
Europe / LatAm in lighting business through
Sylvania. It owns some of the prestigious global
brands like Crabtree, Sylvania, Concord, Luminance,
Linolite, & SLI Lighting.
Exhibit 1: Sensex rebased
Source: MOSL/Bloomberg
Exhibit 2: Shareholding pattern (%)
Dec-17
Promoter
DII
FII
Others
61.6
3.7
25.0
9.7
Sep-17
61.6
3.5
25.7
9.3
Dec-16
61.6
2.7
26.2
9.5
Source: Capitaline
Exhibit 3: Top holders
Holder Name
Nalanda India Equity Fund Limited
Government Pension Fund Global
Smallcap World Fund, Inc
New World Fund Inc
% Holding
5.3
2.8
1.5
1.3
Source: Capitaline
Note: FII Includes depository receipts
Exhibit 4: Top management
Name
Anil Rai Gupta
Puneet Bhatia
Surjit Gupta
T V Mohandas Pai
Rajesh Gupta
Designation
Chairman & Managing Director
Director
Director
Director
Director (Finance)
Exhibit 5: Directors
Name
Adarsh Kishore
Pratima Ram
S K Tuteja
Name
Vijay Kumar Chopra
Ameet Kumar Gupta
JALAJ ASHWIN DANI
Source: Capitaline
*Independent
Exhibit 7: MOSL forecast v/s consensus
Exhibit 6: Auditors
Name
MZ & Associates
S R Batliboi & Co LLP
Sanjay Gupta & Associates
Type
Secretarial Audit
Statutory
Cost Auditor
EPS
(INR)
FY18
MOSL
forecast
11.4
13.9
17.2
Consensus
forecast
10.7
13.2
15.9
Variation
(%)
6.8
5.3
8.2
Source: Bloomberg
FY19
FY20
Source: Capitaline
22 January 2018
9

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Havells India
Disclosure of Interest Statement
Analyst ownership of the stock
Havells India
No
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Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022-3980 4263; www.motilaloswal.com. Correspondence Address: Palm Spring
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Contact No.:022-30801085.
Registration details of group entities.: MOSL: SEBI Registration: INZ000158836 (BSE/NSE/MSE); CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Investment Adviser:
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Equity products
22 January 2018
10