Record revenue masked by 30% profit collapse; war/regulatory headwinds persist

₹2,726.8 Cr consolidated with 12.1% YoY — confirmed highest ever

Confirmed: double-digit bps gains in DC, >100 bps in semi-auto, triple-digit in front load

OPM 5.1%, NPM 3.7% vs prior ~8% — 300+ bps squeeze. War (crude ₹67→₹97, forex 88→96) + regulatory cited

Two price hikes April/May; management admitted 'not sufficient to mitigate 100% of cost increase'

Confirmed as consolidated highlight; Elica maintains double-digit margins

Confirmed; recovered from March air-con WC spike

Prior: 'high single-digit margins stabilize.' Delivered: 5.1% OPM, 3.7% NPM. Management now hedges JAS as 'very challenging.'

Q1: +26% rev, +22% PBT. Analyst asked if 20%+ sustainable—MD dodged, said 'depends on market growth.' No FY27 target.

11.4% standalone, 12.1% consolidated vs mid single-digit industry. Market share up ~30-35 bps. Elica +26% outperformed base business.

Prior: aggressive growth. Now: 'responsible growth,' no cost-of-listing wars, managing inventory risk. Growth still strong (+50%) but scaled-back ambition.

MD: Within 12 months will blueprint capex for manufacturing, new products, automation, M&A. 'Next 12-15 months right time' for inorganic. Budget not a constraint; focus on right projects.

MD: Prices taken April/May; will flow fully in Jul-Sep and beyond. But JAS remains weakest quarter for refrig/AC; commodities high, forex high. No timeline for full recovery.

MD: 'So difficult to predict'; accuracy 'close to zero.' Focusing on market share gains. Cannot guide FY27 because of unpredictability.

MD: Illegal to coordinate. Different players act independently. 5% price swing ~₹1,000 per unit; demand sensitive. Balancing volume/share/profit carefully.

MD: 'Difficult to say.' Depends on market growth. If market strong, we can grow well. If weakens, maybe not. No commitment to 20%.

MD: 'Responsible growth' — no 100% growth targets. Grow at scale, manage inventory, increase margin per unit YoY. Avoid over-shipping.

CFO: War impact much higher; regulatory ~half of war impact. Exact split constrained to share. War + regulatory = bulk of ~400 bps.

MD stated 'accuracy close to zero'; too many external variables (war, regulatory, macro). Focused on market share gains, not growth targets.

Seasonal weakness, commodity costs high, forex high. Regulatory costs locked in FY27. E-waste resolution timeline unknown. No rebound path quantified.

Within 12 months will blueprint capex for capacity (+new products), automation, M&A. Capacity utilization 70-75%; no immediate large capex need.

Crude ₹67→₹97 YoY, forex 88→96. MDI, polyol, EPS (plastics), foaming agents all crude-linked. <30% components imported but high-value. Dollar-indexed costs impact real margin. War continuation unforeseeable.

Energy regs on ref/AC updated Jan 26 (this year); next update ~Jan 29. E-waste accrual 18M at elevated rate; no industry solution. Both are cost headwinds not fully passable to consumer.

Q1: OPM 5.1% (-300 bps), NPM 3.7%. Pricing lags cost inflation in competitive market. War + regulatory drag expected to persist into Q2-Q3 and possibly full year.

AC is lower-margin, high-value, seasonal. Good summer → demand spike, supply shortage. Bad summer (e.g., 2025) → inventory overhang, discounting. ROI inconsistent. Market share single-digit.

2022 unilateral hike caused market-share crash; lesson learned. Market won't follow if competitors don't. Price-sensitive consumer (5% swing ~₹1-5K per unit). Balancing volume/share/profit is delicate.