Shares of this Tata Group stock jumped 4 percent after Brokerage, forecasting high growth prospects for the company, gave a ‘Buy’ rating to the company’s stock.
With a market capitalization of Rs 29,766.39 crores, the stocks of Voltas Limited, a Tata Group entity, opened their trading hour on Wednesday at Rs 893.45 and currently trade at Rs 899.60, gaining around 4 percent as compared to the previous close of Rs 866.50 apiece.
Such movements in the company’s stock prices are witnessed after Motilal Oswal, a well-known Broking Firm based in India, expects the company to bounce back in terms of its declining market share in the ‘Air Conditioners’ segment over the next couple of years which could have a potential impact on the company’s share prices.
The domestic Broker expects Voltas to progress and deliver a compounded annual growth rate (CAGR) in revenues of around 14 percent over the timeframe of FY23-25. Moreover, it expects an EBITDA CAGR of around 30 percent during the same time horizon.
Taking into account all the factors mentioned above, Motilal Oswal has given a ‘Buy’ rating to Voltas Limited with a target price of Rs 1,000 indicating an upside of around 11.16 percent as compared to the current stock prices prevailing in the equity markets.
During the recent quarters, the company has observed opposing movements as far as the operating revenues and net profits are concerned. The former, on one hand, saw an increase from Rs 2,956 crores during Q4FY22-23 to Rs 3,359 crores during Q1FY23-24, and the latter, on the other hand, declined from Rs 171 crores to Rs 160 crores keeping the timeframe the same.
As per the quarter ended June 2023, the shareholding pattern of the company portrays the Promoters holding a 30.3 percent stake, and the Foreign Institutional Investors (FIIs) holding a considerable stake of 19.08 percent in the company.
Voltas Limited, one of the largest Air Conditioning companies in India, is engaged in the business of providing engineering solutions for ventilation, heating, refrigeration, heavy equipment, etc. With a majority of revenue coming from Indian operations, the company also generates revenue from regions comprising Singapore, the Middle East, and many more.
Written by Amit Madnani
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