Shares of Whirlpool of India (Whirlpool) hit a 52-week high of Rs 2,208.10, as they rallied 7 per cent on the BSE in Thursday’s intra-day trade in an otherwise range-bound market. The stock of household appliances surpassed its previous high of Rs 2,198.40 touched on July 29, 2024. In comparison, the BSE Sensex was down 0.01 per cent at 81,774 at 02:25 pm.
Meanwhile, shares of Whirlpool have bounced back 86 per cent from its 52-week low of Rs 1,186.85 touched on February 27. On February 21, Whirlpool Mauritius Limited, the promoters, had sold 30.4 million equity shares or 24 per cent stake of Whirlpool India via an open-market trade for $468 million to reduce debt. The transaction reduced the promoter/s ownership in Whirlpool India from 75 per cent to 51 per cent.
The stake was acquired by the domestic mutual funds including SBI Mutual Fund (MF), ICICI Prudential MF, DSP MF, Nippon India MF and Aditya Birla Sunlife MF.
Whirlpool is primarily engaged in manufacturing and trading of Refrigerators, Washing Machines, Air Conditioners, Microwave Ovens and Small appliances and caters to both domestic and international markets.
Whirlpool Corporation had said it continues to see India as a significant marketplace for growth and an integral part of the company’s growth strategy. The company remains committed to expand the business with new product launches and the recently acquired Elica India business.
Meanwhile, in April to June (Q1) quarter, Whirlpool reported a improved financial performance with consolidated profit after tax up 89.4 per cent year-on-year (YoY) at Rs 145.30 crore. Consolidated revenue from operations rose 22.5 per cent YoY at Rs 2,496.9 crore.
The company said the revenue growth was driven by strong share growth in Refrigerators and Washers compared to last year and industry growth in refrigerators and air conditioners. Earnings before interest, tax, depreciation and amortization (EBITDA) and profit before tax (PBT) improvement was driven by strong volume growth, cost productivity actions leading to better margins and improved mix of premium and high margin portfolio.
“Our market share growth has been gaining momentum across the last few months while profit growth has been ahead of revenue growth consistently due to ROI focus in investment and tight cost management across all lines of the P&L,” the management said.
Analysts at ICICI Securities believe its strategic investments in distribution/ product portfolio expansion may have primarily resulted in market share gains. EBITDA margin expanded to 8.4 per cent (+240bps YoY) led by cost-saving initiatives, premiumisation of product portfolio and operating leverage. Elica (subsidiary) reported muted performance, largely due to weak consumer demand and unfavourable base, in our view, the brokerage firm said.
Whirlpool registered strong market share gains YoY across its key business segments of refrigerators/ washers. These segments contribute 70 per cent plus to net sales. The gains are likely a result of its strategic initiatives like higher investments in distribution network expansion; differentiated schemes such as additional warranty; and strengthening of product portfolio via new product development and premiumisation, ICICI Securities said. However, the stock is trading above target price of Rs 2,075 per share.
First Published: Aug 29 2024 | 2:47 PM IST
