Voltas shares surge 10% amid two-fold growth in Q1 profit

Voltas shares surged 10% to hit a 52-week high of ₹1,568.70 on Monday after the company reported a significant increase in its Q1 consolidated profit in the quarter ended June 30, 2024. The company's net profit more than doubled, rising to ₹335 crore this quarter compared to ₹129.42 crore in the June quarter of FY24.

At the time of reporting, shares of Voltas were trading at ₹1,559.05, up 9.11% from the previous close of ₹1,428.85. The TATA Group subsidiary boasts a market capitalization of ₹51,664.34 crore.

The Tata Group subsidiary reported a 46% jump in total income, reaching ₹5,001.27 crore in the first quarter of this fiscal, compared to ₹3,429.83 crore in the same period last year.

The company reported a significant 67% surge in volumes for its unitary cooling products, which now account for nearly 76% of its total income. This segment saw the highest growth in terms of revenue, a 51% revenue increase, reaching ₹3,802 crores compared to ₹2,514 crores in the same quarter last year.

The Electro-Mechanical Projects and Services segment also performed strongly, with domestic growth fuelled by a robust order book across MEP, Water, Electrical, and Solar sectors, and international projects in the UAE and Saudi Arabia driving a 40% revenue rise to ₹949 crores from ₹679 crores.

Additionally, the Engineering Products and Services segment saw a 13% revenue growth, climbing to ₹161 crores from ₹142 crores year-over-year.

The air conditioner industry in India is expected to generate $5.88 billion in revenue in 2024, with a projected CAGR of 16.56% through 2029, according to Statista. The surge in demand is driven by the country's growing middle class with increased disposable incomes and increasing urbanisation.

The company’s inventory saw an extraordinary 9.4-fold increase to ₹517.76 crore from ₹49.75 crore, reflecting strong demand momentum. The rise in revenues, however, also led to a 41% increase in total expenses, which climbed to ₹4,520.40 crore this quarter from ₹3,195.88 crore in the year-ago quarter.

The exchange filing also revealed that Voltas achieved 1 million AC sales in Q1 FY25. Last year the company had sold over 2 million AC units, the highest ever sold by any brand in a single year, as per the company’s annual report filed with the stock exchanges.