Add Voltas, target price Rs 653: HDFC Securities

Voltas Ltd., incorporated in the year 1954, is a Large Cap company (having a market cap of Rs 21217.98 Crore) operating in Consumer Durables sector.

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Promoters held 30.30 per cent stake in the company as of June 30, 2020, while FIIs held 10.71 per cent, DIIs 38.8 per cent and public and others 20.11 per cent.
HDFC Securities has given add rating to Voltas with a target price of Rs 653. The share price moved down by 0.80 per cent from its previous close of Rs 644.85. The stock’s last traded price is Rs 639.70.

Voltas Ltd., incorporated in the year 1954, is a Large Cap company (having a market cap of Rs 21217.98 Crore) operating in Consumer Durables sector.

Financials
For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 1270.76 Crore, down 38.86 % from last quarter Sales of Rs 2078.39 Crore and down -51.99 % from last year same quarter Sales of Rs 2646.67 Crore Company has reported net profit after tax of Rs 93.45 Crore in latest quarter.

Voltas-graph

Investment Rationale
The company’s performance in challenging times reinforces the brokerage's long-term view. Market leadership in underpenetrated RAC along with an entry in large home appliances gives multi-year growth visibility. It has increased EPS estimates by 1/3/3% for FY21/FY22/FY23. It values Voltas on a SoTP basis, arriving at an implied P/E of 32x (UCP 38x, EMPS 15x, EPS 12x P/E and Volt-Beko 2x P/S) to derive a target price of Rs 653.

Promoter/FII Holdings
Promoters held 30.30 per cent stake in the company as of June 30, 2020, while FIIs held 10.71 per cent, DIIs 38.8 per cent and public and others 20.11 per cent.
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