Nuvama Institutional Equities has downgraded Whirlpool of India to a ‘Hold’ from its earlier stance, despite a strong Q4FY25 performance, citing valuation concerns after a sharp stock rally and lingering uncertainty over the parent company’s proposed stake sale. The brokerage has marginally raised its target price to ₹1,330 from ₹1,320 but believes the risk-reward is now balanced.
Whirlpool reported 16% year-on-year revenue growth in Q4FY25 to ₹2,000 crore, aided by a 17% YoY rise in the parent company’s performance, partially offset by a 6% YoY decline in Elica’s revenue. The quarter also saw a 20% YoY spike in profit after tax to ₹110 crore, with the parent entity’s PAT surging 36% to ₹100 crore.
Gross profit grew 12% YoY, though gross margin contracted 100 basis points to 34.6%. However, the company delivered a strong EBITDA growth of 27% YoY, with margins expanding 80 basis points YoY and 510 basis points sequentially to 9.1%, primarily driven by cost control in employee and other operational expenses.
FY25 performance solid, but promoter stake sale remains an overhang
For the full year FY25, Whirlpool clocked 16% revenue growth, while EBITDA and PAT grew 37% and 46% YoY, respectively. Despite the operational momentum, the company’s cash flow from operations fell 6% YoY to ₹570 crore, while capex rose 80% YoY to ₹120 crore.
Whirlpool also accounted for an exceptional loss of ₹18.9 crore due to a warehouse fire in Delhi in March 2024 and received ₹7 crore in insurance claims against this, which was reflected in Q4 and FY25 results.
Nuvama flagged uncertainty over the promoter stake sale as a key investor concern. Whirlpool’s US-based parent had earlier indicated plans to offload a 31% stake, but no clear progress has been reported on potential buyers or deal structure. This lack of visibility continues to weigh on sentiment.
Valuation captures near-term positives; growth outlook intact
While acknowledging Whirlpool’s strong cost discipline under the “P4G” (Productivity for Growth) initiative and long-term aspiration for high single-digit revenue and margin growth, Nuvama believes most near-term positives are already priced in. The stock has gained over 16% since February 2025, limiting further upside.
The brokerage expects a 9%/13%/16% CAGR in revenue/EBITDA/PAT over FY25–28E, and continues to value the stock at 35x FY27E EPS, arriving at a target price of ₹1,330.
“With no major catalysts in sight and the overhang of the promoter’s stake sale persisting, we believe the stock offers limited upside from current levels,” the report stated.
Disclaimer: This article is based on the brokerage report by Nuvama Institutional Equities. It does not constitute investment advice. Investors are advised to consult their financial advisors before making any investment decisions.
