Voltas shares rise 72% in six months but brokerages sees more upside, here’s why

Shares of Voltas hit their record high in early deals today as Motilal Oswal revised its price target on the stock with a buy call. Voltas shares rose 1.06% to a high of Rs 1429.05 against the previous close of Rs 1414. Market cap of the firm rose to Rs 46,621 crore. Voltas stock opened higher at Rs 1,417 today.

Motilal Oswal has maintained a buy call and revised its price target to Rs 1,650 per share.

“We raise our EPS estimates by 20%/16%/11% for FY24/FY25/FY26, and expect the company to deliver EPS CAGR of 72% over FY24-26 after subdued performance in FY22-24 (earnings declined at 15% p.a. in this period). We maintain BUY on the stock with a revised price target of Rs 1,650 (vs. Rs 1,410 earlier) based on 50x FY26E EPS for the UCP segment, 35x FY26E EPS for PES and EMPS segments and Rs 38 per share for Voltbek,” said Motilal Oswal.

The stock is up 10% since global brokerage UBS upgraded the stock recommendation to 'buy' from 'neutral' on robust growth prospects on April 21.

UBS more than doubled the price target from Rs 885 to Rs 1,800, signaling a big upside potential of over 38 percent of Rs 1,300. UBS analysts said the company would 'surprise' on market share in the room air-conditioner segment. The broader market share is also likely to rise to 23 percent in FY26, said UBS.

Voltas shares are trading higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages. The large cap stock has gained 72 per cent in six months and gained 40.25 per cent in three months.

Total 0.11 lakh shares of the firm changed hands amounting to a turnover of Rs 1.60 crore on BSE. The stock hit a 52-week low of Rs 745 on July 14, 2023.

In FY24, Voltas clocked a 35 per cent rise i9n sales to over two million units in FY24, becoming the first company in the domestic market to cross this mark. The stellar FY24 show was attributed to a consistent demand for cooling products during the year, coupled with a strong offline and online distribution network, and new innovative launches, the Tata Group firm said.

"The company achieved over 2 million AC units during this fiscal 2023-24, the highest ever sale of ACs by any brand in a financial year in India, with a volume growth of 35 per cent," it added.