(Reuters) – Home appliance maker Whirlpool of India reported a 51% jump in third-quarter profit, on strong demand for its products during the festive season.
The Indian unit of U.S.-listed Whirlpool, which is cutting its stake by more than half to 20%, said profit jumped to 439.6 million rupees ($5 million) in the quarter from 280 million rupees a year earlier.
However, it came in below analysts’ average estimate of 476.2 million rupees, according to LSEG data.
Revenue from operations rose 11% to 17.05 billion rupees.
KEY CONTEXT
Whirlpool of India has benefited in recent quarters from its revamped strategy to regain market share lost to competitors. This quarter, in particular, it also benefitted from strong consumer demand during the festive period that included Diwali and Christmas.
Moreover, the company’s products’ average prices is now below those of peers such LG ELectronics and Samsung Electronics, while it has lengthier warranties and an improving mix of premium appliances, analysts have said.
Structurally, India remains under-penetrated when it comes to the household appliance market, with only 18% of households owning a washing machine and less than 40% a refrigerator, according to a 2019-21 health survey by the government.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBIT Price/S Revenue Profit Mean # of Stock to Div yield
DA ales growth(%) growth(%) rating* analysts price (%)
target**
Whirlpool of India 32.74 19.58 2.27 12.96 36.30 Hold 11 0.61 0.40
Orient Electric 36.27 18.36 1.37 13.00 47.94 Buy 14 0.81 0.68
Bajaj Electricals 36.62 19.61 — 11.23 76.17 Hold 9 0.73 0.43
Havells India 54.41 37.06 4.00 14.91 23.15 Buy 24 0.84 0.65
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell ** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
OCTOBER TO DECEMBER STOCK PERFORMANCE
— All data from LSEG — $1 = 87.0530 Indian rupees
(Reporting by Ananta Agarwal in Bengaluru; Editing by Savio D’Souza)
