Havells’ profit rose 39.92% as operating margin slipped YoY
Other income and a lower tax rate lifted profit, while delayed summer demand and cost pass-through issues pressured operations.
Filed 22 Apr 2026, 14:34 IST · Havells India Ltd (HAVELLS)
Key takeaways
- Consolidated net profit rose +39.92% YoY to Rs 723.39 cr, but other income contributed 33.76% of pre-tax profit.
- Operating margin narrowed 0.69 percentage points YoY as expenses grew +3.27% against revenue growth of +2.47%, despite a 1.64 percentage-point QoQ recovery.
- The stock fell -5.74% five sessions after the results, versus a 3.07% median absolute move across eight previous result reactions.
Price around the results
Other income drove the profit increase
Havells’ consolidated operating profit declined -3.65% YoY even as profit before tax rose +30.92%, reflecting a +350.84% increase in other income. Other income accounted for 33.76% of pre-tax profit, making the reported profit growth materially dependent on non-operating income. The tax rate fell 5.07 percentage points to 21.17%, which also supported the +39.92% increase in net profit.
Q4 margin recovered sequentially but stayed below last year
Revenue grew +20.00% QoQ while expenses rose +17.82%, allowing operating margin to recover 1.64 percentage points. On a YoY basis, however, costs grew faster than revenue, so margin narrowed 0.69 percentage points. The 10.88% margin was below the 14.81% median for the 93 Consumer Discretionary peers that had reported, placing Havells 3.93 percentage points below the sector median.
Delayed summer and switchgear costs weighed on the quarter
Management said a delayed summer and unseasonal showers affected electrical consumer durable revenue, particularly fans and air coolers, while Lloyd faced a strong prior-year base and the late summer. The company told analysts that cables performed well, led by power cables, and that the others segment accelerated with growth in renewables; wires were muted as channel inventory normalised. Management said switchgear margins were hurt by a lag in passing through costs and expected them to normalise in coming quarters.
The market reversal was sharper than Havells’ usual result reaction
The stock rose +1.50% on the results date but fell -5.16% on the next session and -5.74% over five sessions. That five-session decline was larger than the 3.07% median absolute move across eight previous result reactions. A corporate-action overlap was also present during this reaction.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹6,705 cr | ₹5,588 cr | +20.00% | +2.47% |
| Other income | ₹310 cr | ₹9 cr | +3319.65% | +350.84% |
| Expenses | ₹5,976 cr | ₹5,072 cr | +17.82% | +3.27% |
| Operating profit | ₹729 cr | ₹516 cr | +41.33% | -3.65% |
| Operating margin (%) | 10.88% | 9.24% | — | — |
| Interest | ₹10 cr | ₹9 cr | +10.53% | -35.15% |
| Depreciation | ₹112 cr | ₹109 cr | +2.91% | +1.93% |
| Profit before tax | ₹918 cr | ₹408 cr | +125.11% | +30.92% |
| Tax | ₹194 cr | ₹108 cr | +80.55% | +5.62% |
| Net profit | ₹723 cr | ₹300 cr | +141.09% | +39.92% |
| EPS (₹) | ₹11.52 | ₹4.80 | +140.00% | +39.47% |
Operating margin of 10.88% compares with a Consumer Discretionary sector median of 14.81% across 93 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +1.50% | +2.31% |
| Next session | -5.16% | — |
| 5 sessions | -5.74% | -4.12% |
| 15 sessions | -8.88% | — |
| 30 sessions | -13.42% | — |
Volume on the results session was 4.24× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Cables performed well, with strong power-cable growth, while wires saw muted growth amid channel inventory normalization.
- The others segment accelerated, supported by strong growth in the renewables space.
Guidance & outlook
- Switchgear margins are expected to normalize in coming quarters as cost pass-through improves.
New initiatives
- Havells invested Rs 600 crores in Goldi Solar Pvt Ltd in Q1 FY26.
Problems & risks
- Cooling products stocking was affected by the milder start to the summer season.
- Consumer categories faced cautious trade sentiment amid higher costs from global disruptions.
- Delayed summer onset and unseasonal showers affected electrical consumer durable revenues, especially fans and air coolers.
- Lloyd revenues moderated because of a strong prior-year base and delayed summer.
- Switchgear margins were affected by a lag in passing on costs.
What to watch
- Whether operating margin moves back towards the 11.57% reported in Q4FY25.
- Whether switchgear margins improve as the company’s stated cost pass-through issue is addressed.
- Whether cooling-product revenue improves from the Rs 6,705.2 cr consolidated revenue reported in Q4FY26.