Voltas Limited: Comprehensive Stock Analysis Report | Scrolls
- Editor
- Sep 3
- 2 min read
by KarNivesh | 03 September, 2025
Voltas Limited, part of the Tata Group, is India’s largest air conditioning company, holding a 20.5% market share. Founded in 1954 as a joint venture between Tata Sons and Volkart Brothers, the company has built a diversified business model spanning Unitary Cooling Products (UCP), Electro-Mechanical Projects & Services (EMPS), Engineering Products & Services (EPS), and the VoltBek joint venture with Arçelik of Turkey. This diversification reduces dependence on a single revenue stream and enhances resilience.
The UCP segment remains Voltas’ flagship business, with sales exceeding 2 million AC units in FY24—the highest by any brand in India. The EMPS division, focused on HVAC and MEP projects, has an order book worth ₹68.2 billion, providing revenue visibility at 1.86 times its FY24 annual revenue. The EPS segment, though niche, delivers high margins through specialized machinery and mining equipment. Meanwhile, VoltBek is gaining traction in home appliances, registering 59% volume growth in Q4 FY25 and crossing 10% market share in categories like washing machines and refrigerators.
Financially, Voltas delivered a strong FY25, with revenue surging 22.75% to ₹1,532 billion and net profit soaring 233.88% to ₹84.1 billion. Earnings per share rose to ₹25.43 from ₹7.62 the previous year. Profitability also improved, with ROE at 12.86% and ROCE at 11.77%. Net profit margins recovered to 5.49% from 2.02% in FY24. However, cash flow from operations slipped into negative territory (-₹22.4 billion), reflecting higher working capital and inventory build-up.
The company’s balance sheet remains strong, with total assets of ₹1,315 billion, equity of ₹654 billion, and a low debt-to-equity ratio of 0.14. Market capitalization stands at ₹47,671 crores, higher than peers like Blue Star (₹39,883 crores). While Voltas leads in market size, peers show better efficiency Blue Star’s ROCE is 26.20% compared to Voltas’ 17.64%. The dividend yield is modest at 0.49%, reflecting a growth-oriented reinvestment approach.
Looking ahead, the Indian AC market is expected to grow from ₹44,000 crores (USD 5.32 billion) in 2024 to ₹1.62 lakh crores (USD 19.61 billion) by 2033 at a CAGR of 15.60%. Voltas is well-positioned to benefit, aided by its ₹500 crore investment in a Chennai manufacturing plant that will scale to full capacity by FY26. VoltBek is expected to reach EBITDA profitability by FY26, strengthening diversification.
However, risks persist. A GST show-cause notice of ₹265.25 crores and a potential ₹400 crore liability from a Qatar case create regulatory overhangs. Seasonal demand volatility, input cost pressures, and intensifying competition from Samsung, LG, and Chinese players remain challenges.
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