Voltas Limited

Consumer Cyclical — Furnishings, Fixtures & Appliances · NSE

₹1,029.10−₹22.90 (−2.18%)

DalalBaazaar Score

56 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Low

Driven by negative free cash flow, a very high earnings multiple, which leaves little margin for disappointment.

In simple words: The business is earning a fairly low return on the money invested in it, with both sales and profits growing well. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:45 pm

Understanding the Business

Company site ↗

The 60-second version of Voltas Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Voltas Limited operates as air conditioning and engineering solutions in India, the Middle East, Africa, and internationally. The company operates through three segments: Unitary Cooling Products; Electro - Mechanical Projects and Services; and Engineering Products and Services.

IndustryFurnishings, Fixtures & Appliances

SectorConsumer Cyclical

Employees1,964

Annual revenue₹14,123 Cr

How does it make money?

Turns over ₹14,123 Cr a year. Of every ₹100 of sales, about ₹3 reaches shareholders as profit, with ₹5 left at the operating level before interest, tax and depreciation. Each of its 1,964 employees supports ₹7.19 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹7.19 Cr

Who are its competitors?

The closest listed comparisons in its industry are HAVELLS INDIA LIMITED, TITAN COMPANY LIMITED. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Little sign of one

Returns on capital of 9.3% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

Peer median ROE36.7%

What is the outlook?

33 analysts covering the stock expect revenue to grow about 17.5% and earnings to grow about 43.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+17.5%

Est. earnings growth+43.8%

Analysts33

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved +50% while net margin moved +85% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+50%

Margin effect+85%

DalalBaazaar Score

56/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ ROCE of 9.3% is below 10% — capital is not working hard
✓ ROCE has improved by 3.3 points over the period — returns are strengthening
✗ EBITDA margin of 4.7% is thin — little cushion if costs rise
✗ Net margin of 3.0% is slim
• Revenue has compounded at 14.5% a year, which is the base these returns are earned on

Quality vs. Valuation

Company Quality

59/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

42/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

75.8x

3Y Median

173.2x

40 monthly readings · mean 167.0x · range 49.0x–376.9x

Sector Median

56.0x

median of 2 sector peers

🟢Current valuation is approximately 56% below its 3y median of 173.2x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

⚠️Against its sector it trades 35% above the peer median of 56.0x.

vs. its own history

Cheap

173.2x median over 40 months · -56%

vs. sector peers

Expensive

56.0x median of 2 peers · +35%

vs. generic bands

Expensive

Above 35x

EV/EBITDA

51.8x

PEG

1.86

What's Good / What's Bad

🟢 What's Going Well4

Return on equity is rising
ROE has improved from 2.5% to 5.9%.
Return on capital is rising
ROCE has improved from 5.9% to 9.3%.
Very low debt
Debt/Equity of 0.16x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

3 items require attention · 2 high · 1 watch

🔴Debt has risen sharplyFinancial
Total debt is up 53% over 3 years, from ₹651 Cr to ₹992 Cr.
🔴Inventory building faster than salesFinancial
Inventory up 116% against revenue up 50% — stock may not be moving.
🟡Free cash flow is negativeFinancial
Free cash flow was -₹62 Cr in the latest year.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 56% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

A premium to the sector to defend
It trades 35% above the peer median. That premium needs a reason that persists, or it closes.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 11% a year✓ 14.5% CAGR
Latest reported year was 18.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 3%✓ 4.7%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Free cash flow remains positive✗ -₹62 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 1.5x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 8%✓ 9.3%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

6 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✗ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 3 neutral · 4 weak

Market Cap

₹34,051 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

75.8x

Expensive

Expensive — verify against sector peers

P/B Ratio

5.34x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹13.57

Profitable

Profitable on a per-share basis

ROE

5.9%

Weak

Weak capital efficiency

ROCE

9.3%

Moderate

Moderate return on the capital in the business

Debt/Equity

0.16x

Low

Conservative leverage

Revenue Growth (YoY)

18.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

52.0%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.39%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

-₹62 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

32.5x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

5.2%

Average

Average margins

Net Margin

3.0%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.37

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.20

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

1074.9 / 1158.1

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

30.0

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹9,399 Cr	₹12,407 Cr	₹15,320 Cr	₹14,123 Cr	+14.5%
EBITDA	₹315 Cr	₹458 Cr	₹1,143 Cr	₹662 Cr	+28.1%
EBITDA Margin	3.4%	3.7%	7.5%	4.7%	—
PAT (Net Profit)	₹135 Cr	₹252 Cr	₹841 Cr	₹376 Cr	+40.7%
EPS	₹4.08	₹7.62	₹25.43	₹11.36	+40.7%
ROE	2.5%	4.3%	12.9%	5.9%	—
ROCE	5.9%	8.6%	17.5%	9.3%	—
Total Debt	₹651 Cr	₹744 Cr	₹892 Cr	₹992 Cr	+15.1%
Free Cash Flow	-₹21 Cr	₹468 Cr	-₹433 Cr	-₹62 Cr	—

🟢 Revenue has grown at 14.5% a year over 3 years.

🟢 EBITDA has grown at 28.1% a year over 3 years.

🟢 EBITDA Margin has risen from 3.4% to 4.7% over 3 years (+1.3 pts).

🟢 PAT (Net Profit) has grown at 40.7% a year over 3 years.

🟢 EPS has grown at 40.7% a year over 3 years.

🟢 ROE has risen from 2.5% to 5.9% over 3 years (+3.4 pts).

🟢 ROCE has risen from 5.9% to 9.3% over 3 years (+3.3 pts).

🔴 Total Debt has grown at 15.1% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹14,510 Cr

Total Liabilities

₹8,111 Cr

Cash & Equivalents

₹755 Cr

Operating Cash Flow

₹71 Cr

Capex

-₹133 Cr

Shareholding (proxy)

Institutional Holding

40.3%

Insider Holding

36.9%

Corporate Actions

Next Earnings

19 Nov 2026

Dividend Rate

₹4

Ex-Dividend Date

12 Jun 2026

Analyst Consensus

Recommendations

15 Buy · 15 Hold · 4 Sell

Target Price (Mean)

₹1,314.91

+27.8% vs CMP

Target Range

₹1,025 – ₹1,550

Peer Comparison

Company	P/E	ROE
HAVELLS INDIA LIMITED	43.5x	17.1%
TITAN COMPANY LIMITED	68.5x	36.7%

Recent News

4 mixed1 negative1 general

Voltas (NSEI:VOLTAS) - Stock Analysis

Simply Wall Street, 02 Oct

Voltas share price: Nuvama upgrades rating but Jefferies cuts target price after analyst meet. Here’s why

The Economic Times, 23 SeptAnalyst view

🔴Potentially negativeAn analyst opinion changing, which moves the price without changing the business.

Voltas stock falls 4% after Q1, top midcap loser; brokerages split as margin concerns outweigh strong AC...

Moneycontrol.com, 17 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Voltas shares slip 4% despite strong Q1 show; analysts flag margin risk

Business Standard, 17 AugAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Voltas Share Price Declines 2.05% in Mid-Morning Trade

TradingView, 19 AugPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Voltas Share Price: Check most recent price targets after Q1 results, management margin guidance

CNBC TV18, 17 AugResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongGrowth

MiddlingFinancial Health · Profitability · Risk

WeakBusiness Quality · Valuation

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

1 of 5 tripwires tripped — Free cash flow remains positive · see Key things to watch ↑