Havells India Myth Resolved, Growth On Track, Retain BUY : Emkay

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Havells India

Myth Resolved, Growth On Track, Retain BUY

BUY

CMP: Rs437                                       Target Price: Rs460

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We met Havells to analyze its stellar operational performance in H1FY12 and get an outlook on the business in this testing environment

n     New product launches across business segments and expansion in distribution network to drive 14-15% domestic revenue growth 

n     Europe business fairly stable; LATAM and Asia to continue as revenue growth drivers for Sylvania. Margins to be sustained at 7.3% for FY12E

n     Strong H1FY12; Continuity of growth momentum in domestic operations and sustainability of Sylvania profitability in H2FY12 as well

n     Retain Buy with price target of Rs 460, thereby implying target multiple of 8.6x FY13E EV/EBIDTA.