#EBITDA #GROWTH 5 Year CAGR10.2%

Key components for manufacturing of the company’s products such as compressors, copper tubes, electronic parts, indoor units for split air conditioners and inverter drives are sourced from vendors in China and vendors in India. This is mitigated by diversifying procurement sources along with backward integration at plant. Better product mix, coupled with planned procurement of inventories helped to partially mitigate the increased cost of commodity prices and higher logistics costs. In FY25, the EBITDA was ₹1,116 cr up by 135% YoY. This was majorly due to higher cost escalations and higher losses in the EMP segment.

#PAT #GROWTH

In FY25, the company recorded PBT at ₹1,317 cr. The consolidated PAT registered was ₹960.3 cr which includes loss of share associates of ~₹126 cr. Results of Q3 FY23 and Q2 FY23 included provisions amounting to ₹137.4cr and ₹106.4 cr respectively which was made due to the termination of a contract and encashment of bank guarantees for two overseas projects in Dubai and Qatar, respectively. The necessary legal steps has been taken to recover the money. They had received arbitration award in their favor related to this encashment as informed in Q1 FY25.

#EBITDA #MARGIN

In FY25, EBITDA margin was 7.24% and segmental EBIT margin for Electro-Mechanical Projects and services was 4%, Unitary products at 8.4% and Engineering Products & Services at 27%. The company reported positive EBIT in the ElectroMechanical Projects & services in FY25 after FY22. This was mainly due to improved order booking, better project execution and working capital management.

#PAT #MARGIN

In FY25 the PAT margin was at 6.2%. In FY24, the PAT margin was 3.1%.

#ROCE

In FY25, PBIT for the year was ₹1,253 cr and the capital employed was at ₹7,102 cr. The ROCE stood at ~18%. CASE STUDY

#MANAGEMENT

The management is led by Mr. Noel N Tata. He is also Chairman of Trent Limited and Tata Investment Corporation Limited and Vice Chairman of Titan Company Limited and Tata Steel Limited. His knowledge of Retail business is humongous and has aspired the company grow in consumer products significantly. Mr. Pradeep Bakshi, Managing Director & CEO of the company has around 39 years of experience in consumer appliances domain and his vast expertise and experience in the appliances domain makes him a distinct professional. Under his able leadership, Voltas has consistently grown in revenue and profitability, ahead of the AC Industry. Voltas achieved leadership position in market share of room air conditioners.

#COMPANY #POTENTIAL

• India’s consumer durables industry is experiencing rapid growth and is currently the fastest-growing major market globally. It is projected to become the fourth-largest market by 2026–27, with an estimated market size of ₹3 lakh crore by 2028–29. • The Water Heater segment thrives in the Indian market, with an annual demand of approximately 5 million units. The segment has experienced consistent growth of 10-12% year-on-year (YOY), with a selling window of almost 10 months in a year. • Room Air Conditioner (RAC) penetration in India currently stands at 10%, but the market is witnessing rapid growth. Valued at approximately ₹37,000 crore (USD 4.33 billion) in FY24, the RAC segment is growing at a CAGR of 19.9% and is expected to reach around ₹91,000 crore (USD 10.65 billion) by FY29. • The Indian RAC market saw volumes rise from 8.4 million units in FY23 to 10 million units in FY24. The industry anticipates that total AC volumes will grow from the current 1.3–1.4 crore units (FY25) to 3–3.5 crore units over the next five years. • The Indian Commercial Air Conditioning industry is valued at ~₹8,000 crore, it is projected to grow at a CAGR of ~12%. • Commercial Refrigeration market has a potential to grow at 30% because India is underpenetrated in the same. Whereas commercial air conditioning products should grow at a CAGR of 12%-12.5% as per the management of the company. • The commercial refrigeration market size was valued at ₹4,033 crores in 2019-20 and is projected to reach ₹8,022 crores in 202627, registering a CAGR of 10%. Increase in demand for frozen products among the consumers due to change in lifestyle and rapid urbanization, combined with growth in the organized retail sector with increase in number of hypermarkets/supermarkets is expected to drive demand for commercial refrigeration products. • India’s domestic textile and apparel market is projected to reach USD 190 billion by 2025–26, while exports are expected to touch USD 100 billion by 2030. TMD’s growth strategy centers on expanding its aftersales services and entering new markets like CASE STUDY Bangladesh, Sri Lanka, and Africa, with a continued emphasis on sustainable and automated solutions.

#FUTURE #OUTLOOK

• The company aims to enhance market share in its core categories by deepening distribution and accelerating product innovation to meet evolving customer needs. It plans to continue its focus on energy efficient and IoT – enabled cooling solutions. • Voltbek, the home appliances JV, is set to expand capacity by 50% at its Sanand plant to boost 'Made-in-India' production, especially refrigerators. Future include launching new Frost-Free and Direct-Cool models, expanding its SDA range, strengthening in-store presence, introducing digital-first products for e-commerce, and promoting dishwashers with India-focused awareness campaigns. The company also aims to improve operational efficiency and grow market share in washing machines. • As of YTD February 2025, the company’s market share rose to 8.7% in washing machines and 5.3% in refrigerators, with a strong 15.3% share in the semi-automatic washing machine segment—making it the second-largest player in that category. It sold over 1 envisaged to accrue from FY26. million units across refrigerators and washing machines, achieving 56% volume growth for the year ended 31st March 2025 and emerged as the fastest-growing electrical appliances company in the country. • Both commercial air conditioning and commercial refrigeration segment is envisaged to do well as there is demand for cold chain products, increase in commercial offices, airports, group company’s shops, etc. It envisages double digit growth for this category. • The company believes in the merits of backward integration of certain products like Heat Exchanger, Cross Flow Fan and Plastic components, and had applied to avail the Produ

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Blue Star Limited company details report

Blue Star Limited, incorporated in 1943, headquartered in Mumbai, is a leading heating, ventilation, air conditioning and commercial refrigeration (HVAC&R) company, and a major player in the mechanical, electrical, plumbing, and fire-fighting (MEP) space with a network of 31 offices, 7 modern manufacturing facilities – 2 at Himachal Pradesh and one each at Dadra, Ahmedabad and 2 in Wada and one at Sri City. It has 4,120 channel partners. The Company has 7,500 stores for room ACs, packaged air conditioners, chillers, cold rooms as well as refrigeration products and systems, along with 1,172 service associates reaching out to customers in over 900 towns. The Wada plant has an installed production capacity of 3L deep freezers and 1L water coolers, while the Ahmedabad plant has a dedicated capacity for deep freezers of 1L units. The Wada plant also manufactures cold room panels, evaporating units, and condensing units. The Company’s integrated business model of a Manufacturer; Engineering, Procurement and Construction (EPC) services provider; and an after-sales service provider; not only enables the company to offer end-to-end solutions to its customers across building, industrial, and infrastructure segments, but also facilitates delivery of these offerings in an agile manner. It exports AC&R (air conditioning & refrigeration) products and Original Equipment Manufacturing (OEM)/Original Design Manufacturing (ODM) businesses for globally recognized brands such as Danfoss and Rheem and solutions to 19 countries across the Middle East, Africa, SAARC and ASEAN regions. Through its joint ventures in Qatar and Malaysia, the company also undertakes MEP projects for residential, commercial and infrastructure in those markets. The company is a market leader in the product categories of modular cold rooms, deep freezers and storage water coolers and estimates their market share, both the residential segment and institutional segment put together, to be 14%. In volume terms they are marginally higher than 10%. It crossed ~15.7 lakh units during FY25 in RAC segment.

Electro - Mechanical Projects and commercial air conditioning system – This business segment covers the design,manufacturing, installation, commissioning and maintenance of central air conditioning plants, packaged/ducted systems and Variable Refrigerant Flow (VRF) systems, as well as contracting services in mechanical works, electrification, plumbing and fire-fighting, and water distribution. It also comprises after-sales services such as revamp, retrofit and upgrades, which covers a wide repertoire of operation and maintenance services for efficient functioning of electro-mechanical utilities. Unitary Products – The company offers a wide variety of contemporary and highly energy-efficient room air conditioners for both residential as well as commercial applications. It also manufactures and markets a comprehensive range of commercial refrigeration products and cold chain equipment. Besides, the company has water purifiers, air purifiers and air coolers in its product portfolio. This segment is seasonal in nature. Professional Electronics and Industrial Systems – Exclusive distributor in India for many internationally renowned manufacturers of professional electronic equipment & services, as well as industrial products and systems. This business is managed by the company’s wholly owned subsidiary, Blue Star Engineering & Electronics Limited.

#SALES #GROWTH 5 Year CAGR 13.1%

In FY24 the revenue registered were ₹9,685 cr up by 21% YoY. The company sold over 1 mn units during the year. The order book for FY24 was at ₹5,477 cr. In 9M FY25, the company’s revenue grew by 25% YoY to ₹7,949 cr. The carried forward order book as of 31st December 2024 increased by 12.8% YoY to ₹6,810 cr. The RAC market share stood at 14%. Segment-wise, UCP (Unitary products and commercial refrigeration) grew by 27%, while PEIS (Professional electronics and industrial systems) declined by 3%. Room AC growth was driven by a strong festive season, and the commercial refrigeration business resolved regulatory challenges in water coolers and deep freezers. The EMP (Electro-Mechanical Projects and commercial air conditioning systems) business saw 26% YoY growth, with progress in factory and data center orders, although demand from commercial real estate and infrastructure was subdued.

#EBITDA #GROWTH 5 Year CAGR 13.9%

In FY24, the EBITDA was ₹665 cr v/s ₹493 cr in FY23. In 9M FY25, the EBITDA grew by 41% to ₹597 cr. The major cost components are cost of material consumed, advertising and legal costs (other operating expense). Key components for manufacture of the company’s products such as compressors, copper tubes, electronic parts, indoor units for split air conditioners and inverter drives are sourced from vendors in China and some other countries. This is mitigated by diversifying procurement sources along with backward integration at plant.

#PAT #GROWTH 5 Year CAGR 16.8%

In FY24, PAT was ₹414 cr and effective tax rate 26%. In 9M FY25, the PAT registered were ₹398 cr registering a growth of 56% YoY.

#EBITDA #MARGIN

In FY24, EBITDA margin was 6.9% whereas segmental EBIT margin for Electro-Mechanical Projects and commercial air conditioning systems was 7%, Unitary products was 7.8% and for Professional electronics and industrial systems it was 14%. In 9M FY25 EBITDA margin was 7.5% but segmental EBIT margin for Electro-Mechanical Projects and commercial air conditioning systems was 8.5%, Unitary products and commercial refrigeration at 8.4% Professional electronics and industrial systems at 8.1%.

#PAT #MARGIN

In FY24, the PAT margin was 4.3%. In 9M FY25, the PAT margin was at 5%.

#ROCE

In FY24, capital employed during the year was ₹2,731 cr and PBIT ₹615 cr and the ratio was ~26%. ₹665 cr was employed in the electromechanical projects and commercial air conditioning systems and ~ ₹1,251 cr in unitary products segment whereas remaining amount was in others.

#COMPANY #POTENTIAL

• Indian appliances and consumer electronics industry stood at US $9.84 billion in 2021 and is expected to more than double to reach ₹1.48 lakh cr (US $21.18 billion) by FY25. (Source : IBEF) • The Room Air Conditioner Market (RAC) grew 45% over FY22 in value terms. As a result, the overall market size grew to ₹22,750 cr in FY23, of which the market for central air conditioning, including central plants, packaged and ducted systems, and VRF systems was around ₹4,250 cr, while the market for room air conditioners comprised the balance ₹18,500 cr. • The overall AC industry (both residential and commercial), currently valued at around ₹27,500 cr in FY24, is likely to double in the next four years. In FY24, of which the market for central air conditioning, including central plants, packaged and ducted systems, and VRF systems was around ₹4,500 cr, while the market for room air conditioners comprised the balance ₹23,000 cr. • In FY23, the Indian RAC has grown to 8.4 million units and 10 million units in FY24. • The demand growth in the segment is expected on the back of rising urbanization, increasing disposable income of the middleclass population, easy consumer credit, wide usability of online sales and decreasing replacement cycle. • As a part of the Atmanirbhar Bharat Program, the Government has announced Production Linked Incentive (PLI) Schemes for many product categories, the ecosystem for air conditioning components is developing fast in the country. In pursuit to secure their supply chain, European and American players are looking at reliable and capable manufacturers outside China. • E-commerce, as a distribution channel, has been witnessing phenomenal growth owing to the impetus provided by the Pandemic, thereby advancing its penetration in the country by 12-18 months. The Indian E-commerce market is expected to grow 21% to ₹58,580 cr (US $75 Billion) in 2022 and is likely to reach ₹1,01,547 cr (US $130 Billion) by 2025 growing at a CAGR of over 20%. The number of internet connections in 2021 increased significantly to 830 million, driven by the ‘Digital India’ programme.