Synopsis:
Whirlpool of India is in focus as Bain Capital, who was once interested in buying the 31% stake in the company, reportedly dug out of the round, leaving EQT as the sole contender, and is discussing the round at a much lower valuation.
The shares of this leading manufacturer and marketer of major home appliances in India are in focus as reports emerged that a key player will be out of the race to acquire a stake in the company. In this article, we will dive more into this detail.
With a market capitalization of Rs 17,344 crore, the shares of Whirlpool of India Ltd made a day low of Rs 1,331 per share, down by 3 percent from its previous day closing price of Rs 1,369.65. Over the past five years, the stock has corrected by over 36 percent.
What’s the news?
Whirlpool of India’s plan to sell a 31 percent stake has hit a pause as Bain Capital has chosen to opt out of the bidding. They decided to step back because Whirlpool’s asking price was simply too steep, especially considering the company’s limited footprint in the rapidly growing premium appliances market compared to the mass market segment.
Now, EQT, a Swedish investment firm, stands as the sole bidder and is currently negotiating at a more reasonable valuation. Whirlpool aims to raise about $550-600 million (Rs 4,684-5,110 crore) from this stake sale, with Goldman Sachs overseeing the entire process. Even after the deal, the US parent company will retain a 20 percent stake in Whirlpool India through Whirlpool Mauritius.
Other potential bidders like TPG, KKR, Havells, and Reliance Industries have also pulled out of the race. If Whirlpool can’t secure the price it’s hoping for, it might postpone the stake sale, but talks with EQT are still very much in progress.
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Financial Highlights
The company reported a revenue of Rs 2,432 crore in Q1 FY26, down by 3 percent from its Q1 FY25 revenue of Rs 2,497 crore. However, revenue surged by 21 percent from Rs 2,005 crore in its previous quarter.
Regarding its profitability, the company reported a net profit of Rs 146 crore in Q1 FY26, up by 1 percent from its Q1 FY25 net profit of Rs 145 crore. Additionally, it grew by 23 percent from Rs 119 crore in its previous quarter.
The stock delivered a poor ROE and ROCE of 9.26 percent and 12.63 percent respectively, and is currently trading at a P/E of 48.75x as compared to its industry average of 56x.
Whirlpool of India Limited, which was incorporated in 1960 and has its head office in Gurugram, India, produces and sells home appliances like refrigerators, washing machines, air conditioners, microwaves, dishwashers, and small kitchen appliances. It is a subsidiary of Whirlpool Corporation and operates in Indian and international markets.
Inshorts
Whirlpool of India fell 3% after Bain Capital dropped its plan to acquire a 31% stake, citing high valuation concerns and the company’s limited premium market presence. EQT now remains the sole bidder, negotiating at a lower valuation, while other potential buyers like TPG, KKR, Havells, and Reliance have also exited.
Written by Satyajeet Mukherjee
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