MOSL: VOLTAS (Neutral)-Takeaways from review of Voltas Beko products
Voltas: Takeaways from review of Voltas Beko products; Impressive line-up of refrigerators and washing machines
(VOLT IN, Mkt Cap USD2.3b, CMP INR484, TP INR540, 13% Upside, Neutral)
We took a look at the recently launched washing machines and refrigerators of ‘Voltas Beko’—a TATA product, which are expected to see a pan-India rollout by Diwali this year. We were quite impressed by the product quality, range and features on offer v/s competition. In line with earlier commentary from management, pricing is largely in line with Korean peers (although most products are imported and despite the recent sharp INR depreciation). Going forward, two critical factors would determine the success of the ‘Voltas Beko’ brand and its target to capture 10% share—namely (1) dealer margins being offered, and (2) the ad/promotion campaigns rolled out to capture consumer mindshare (INR1b is planned for advertising annually over the next four years, as per media reports).
Our take on the product line-up is highlighted below:
Refrigerators (250-470litres, double-door frost-free): The refrigerators are imported from Thailand with the initial rollout of frost-free models; the company plans to launch smaller-sized direct-cooling models later. Unique features of the refrigerators that stood out for us are:
- Frost-free inverter compressors with 12 years warranty versus the 10-year industry norm
- Digital display to separately control temperatures in the freezer and cabinet; note: this feature is usually available in high-end/premium LG and Samsung models of 400litres and above
- Dual cooling and separate air flow between fridge and freezer along with 2x cooling. The company has branded this as ‘Neofrost dual’ cooling
- Blue light protection, which the company claims keeps vegetables/food fresh for 30 days
Voltas is an air conditioning company based in India. Co. offers engineering solutions for industries in areas such as heating, ventilation and air conditioning, refrigeration, electro-mechanical projects, textile machinery, mining and construction equipment, water management & treatment, cold chain solutions, building management systems, and indoor air quality. Co. is principally active in the management and execution of electro-mechanical projects and the installation and servicing of diverse technology-based systems. Co.'s operations are organized along three business segments: Electro-Mechanical Projects & Services; Engineering Products & Services; and Unitary Cooling Products.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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