Voltas Soars 80% in 8 Months, Delivers 170% Returns in 4 Years – Multibagger Tata Group Stock Shines

Voltas, a Tata Group company, has seen a remarkable increase in its stock price, hitting new highs each month. From trading at ₹827 per share in December, the stock has jumped 80%, now trading at ₹1,485 per share. This rally has pushed the stock’s overall gain to 172% over the last four years.

Strong Performance in Q1 FY25

In the first quarter of FY25, Voltas’ stock rose 33%, driven by extremely high temperatures across India, which increased the demand for cooling products. April saw the highest temperatures in eastern and northeastern India, and the second highest in southern India since 1901, according to IMD data.

Record Air Conditioner Sales

The heatwave in the June quarter led to record air conditioner sales of six million units from April to June, showing a 50% year-on-year growth, according to CEAMA. Voltas, a leader in the cooling products market and the top Room Air Conditioner (RAC) brand in India, benefited significantly from this sales surge.

Expansion and Market Presence

Voltas has a strong presence in engineering products and electromechanical projects through Universal MEP Projects & Engineering Services Limited in India and the Middle East. Its joint venture, Voltbek Home Appliances Private Limited, with European appliance manufacturer Arçelik, has expanded its product range.

Sales Milestones and Market Share

In the fiscal year 2023–24, Voltas sold over 2 million AC units, the highest sales volume for any brand in a single year in India. The company aims to reach this milestone within the first six months of the current calendar year. So far, Voltas has sold one million AC units within the first 110 days of the year. Despite recent challenges in the RAC segment, Voltas maintained an 18.7% market share by the end of FY24.

Challenges and Competition

The Indian RAC market is becoming more competitive with both domestic and international players. Sales are seasonal and unpredictable weather during summer could impact sales. Recent Quality Control Orders (QCO) norms have also affected component imports, adding challenges for the industry.

Innovative Products and Future Growth

To maintain its market leadership in commercial refrigeration, Voltas has introduced new energy-efficient, star-rated freezers and convertible models, and a new 5-star-rated glass top range with green refrigerant.

Domestic brokerage firm Prabhudas Lilladher predicts a 19% year-on-year revenue growth for Voltas’ UCP segment in Q1 FY25, driven by high demand during the severe summer. The Engineering, Procurement, and Construction Services (EMPS) segment is expected to grow by 25% year-on-year. Overall, consolidated revenues are expected to increase by 18.9% year-on-year, with an EBITDA margin of 6.4%.

RAC Market Growth

The Indian RAC market is expected to grow at a CAGR of 12% to reach ₹50,000 crore by 2028–29. Voltas is well-positioned to lead this growth due to its superior product range, extensive channel network, and excellent service delivery. Hotter summers, rising disposable incomes, and easier access to consumer finance are expected to drive growth in this segment.