Havells Earnings Preview: SEBI RA Rohit Mehta Sees Breakout Potential If Q1 Momentum Holds

Electrical equipment maker Havells India is consolidating near a key support zone ahead of its first-quarter earnings, which are scheduled for later in the day.

The stock is currently in a bullish setup, holding firm above a key support zone of ₹1,420 - ₹1,480 on the weekly chart, according to SEBI-registered analyst Rohit Mehta.

After a strong rally, the stock has entered a coiling phase, forming a classic Cup and Handle pattern, Mehta noted. The formation is often seen as a precursor to a breakout.

A sustained move above ₹1,480 would reaffirm the bullish trend, while a breakout past the ₹1,772 resistance could lead to a rally towards ₹2,092, an 18% upside.

At the time of writing, Havell’s shares were up 0.4% to 1,523.

In the previous quarter, the company reported solid growth across key metrics, with sales increasing 20.25% and operating profit rising 19.21%. EPS also improved by 15.85%.

Shareholding data shows a marginal decline in promoter and foreign investor holdings (FII), while domestic investors (DIIs) have increased their stake to 13.18%.

Fundamentally, the company, which manufactures switches and fans, remains virtually debt-free, has a healthy dividend payout ratio of 43.6%, and has enhanced operational efficiency, with working capital days decreasing from 17.4 to 13.3. However, at 11.4x book value, valuations remain rich, the analyst said.

If earnings momentum continues and the technical structure holds, Havells could be gearing up for a breakout, Mehta concluded.

Year-to-date, the stock has fallen 9%.

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