Havells India: ICICI Sec trims TP to ₹1,725, keeps Buy

Why Havells is back in focus

Havells India is seeing fresh brokerage updates after a period of stock price weakness and near-term demand concerns in key categories. ICICI Securities has maintained a positive long-term stance but flagged that the next few quarters could stay soft, particularly in room air conditioners (RAC). A separate set of analyst commentary also points to a tougher FY26 margin base, with expectations of a stronger FY27 on favourable seasonality and competitive shifts. The result is a mixed near-term narrative with a relatively steady long-term thesis.

ICICI Securities trims target price, retains rating

ICICI Securities revised its target price for Havells India to ₹1,725 from ₹1,775, while retaining a Buy rating. The brokerage said the revised target is based on a discounted cash flow (DCF) valuation framework. It added that the target implies about 46x FY28E EPS. The report framed the current setup as an entry point for long-term investors after a prolonged correction in the stock.

What is driving the near-term softness

ICICI Securities highlighted a soft near-term outlook due to weak demand for room air conditioners. It also pointed to potential earnings impact from upcoming Bureau of Energy Efficiency (BEE) norm changes for fans and air conditioners from January 2026. The note referenced elevated inventory and suggested that normalisation should continue as demand stabilises. It also said the company appears focused on maintaining margin stability while diversifying its product portfolio.

Stock correction is part of the valuation argument

ICICI Securities noted that Havells stock corrected about 17% in 2025 so far and about 20% over the past 12 months. The brokerage used this decline to support its view of an attractive entry point for long-term investors, despite the near-term headwinds. Another analyst commentary referenced the stock trading below its Mean P/E minus 1 standard deviation, describing this as a margin-of-safety setup at current valuations. These statements reflect how valuation comfort is being used to balance weaker immediate demand signals.

Margins, growth assumptions, and why FY27 is central

One set of analyst assumptions in the shared commentary pegged FY26 EBITDA margin at 9.8%, describing it as near the bottom level of the past decade. The same commentary models mid-teens revenue growth alongside operating leverage, which could support margin expansion. It also said FY27 could emerge stronger due to a favourable base and the El Nino effect aiding “summer products,” alongside the possibility of market share gains as smaller unorganised players face pressure in high-inflation periods.

Separately, ICICI Securities said it expects Havells to deliver revenue and PAT CAGRs of 11.0% and 15.7% respectively over FY25-28E, while also expecting strong free cash flow generation. Another brokerage-style outlook in the provided text models revenue/PAT CAGRs of 15.3%/23.0% over FY26-28E, again linking the thesis to strong free cash flow.

Solar business projections cited by ICICI Securities

ICICI Securities models Havells to generate ₹400 crore revenue from solar panels, inverters and ancillaries in FY26. It also said it is targeting ₹1,000 from the solar business by FY27E (figure as stated in the note). The brokerage attributed the opportunity to industry tailwinds, Havells’ distribution network, and stable pricing. The solar push was positioned as part of a broader effort to diversify the portfolio while staying focused on margin stability.

Street view: targets and ratings mentioned across reports

Alongside ICICI Securities’ updated target, multiple targets and stances were referenced across the provided material. Motilal Oswal was noted as maintaining Neutral and trimming its target to ₹1,680 after a Q1FY26 miss. Jefferies was noted as maintaining Hold and trimming its target to ₹1,635. Morgan Stanley was noted as retaining an Overweight rating with a target price of ₹1,884, citing upside from a current market price cited as ₹1,533.

The material also referenced aggregated analyst estimates with a max estimate of ₹1,844 and a min estimate of ₹1,350 for Havells India. It also referenced “Mean Recos by 39 analysts” with an overall BUY indication.

Key figures snapshot

What investors will track from here

A key near-term variable is how demand in RAC shapes up, especially with channel inventory and seasonality in play. Another monitorable item is the impact pathway from BEE norm changes starting January 2026, as brokerages have explicitly flagged this as an earnings sensitivity. Investors will also track whether margin pressure in FY26, described as near a decade-low in one note, eases with operating leverage as revenues improve.

Broker commentary suggests that FY27 is expected to be a stronger year in some models, driven by a favourable base, summer-led growth and market share shifts away from smaller unorganised players in high-inflation periods. At the same time, the divergence in targets and growth forecasts indicates that expectations on pace of recovery and valuation comfort vary across firms.

Conclusion

ICICI Securities’ target cut to ₹1,725 keeps the near-term caution intact while retaining a Buy based on its long-term view and DCF valuation. The next few quarters are expected to be influenced by RAC demand, inventory normalisation, and BEE norm-related changes from January 2026. Updates around category demand trends and management execution on diversification, including the solar business revenue ramp cited by the brokerage, are likely to remain the key signposts.