Voltbek Likely To Be Value Accretive From FY25: ICICI Securities

ICICI Securities Report

Voltas-Beko, which is still in an investment mode, is likely to be value accretive from FY25, in our view. It has focussed on gaining volumes and market shares since its inception in FY18.

We believe it will have market share of ~10% in its both the key categories i.e. refrigerators and washing machines in next couple of years. Its H1 FY25, market shares in refrigerator and washing machine were ~5% and ~8%, respectively.

We also model it to have low-mid single-digit market shares in categories like dishwasher and microwave ovens.

Voltbek may reach revenues of Rs 25 billion in FY25 and will be mostly Ebitda breakeven. As it will start generating earnings and cashflows, it will be able to fund growth from its internal accruals and will not be dependent on Voltas and Arcelik for additional capital.

We also note Voltbek has been successful in creating competitive advantages such as-

1. Voltbek brand,

2. distribution network of 11,400 outlets,

3. large portfolio of 298 stock keeping units across product categories and

4. manufacturing unit at Sanand, Gujarat to launch differentiated products.

We believe it will be able to add ~5% additional value to Voltas in FY27 and beyond. Maintain Hold.

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