Voltas Ltd’s share soared 9 per cent in trade on Monday after the company impressed the Street with its better-than-expected March quarter performance. Revenues grew 1.4 per cent notwithstanding the lost sales of cooling products in March. ‘Due to lockdown, substantial business was lost in March 2020, which is the beginning of the peak season (summer) and year end billings were adversely impacted,’ Voltas said in a statement.

Even then, revenues at the cooling products division grew 20 per cent year-on-year while Voltas maintained market leadership in the room air conditioner (AC) business. ‘Voltas has achieved market leadership in inverter AC segment in January-February 2020 within ACs, which is a positive as there has been some investor concern on their share vs LG and other players in this growing segment,’ Jefferies India Pvt. Ltd said in a note. The results are notably better than that of Blue Star Ltd, which also has large presence in cooling products business. The company’s consolidated revenue fell 18 per cent in the quarter ended March, while that at the unitary cooling products division declined 15 per cent.

That said, Voltas’s results show notable hit to electro mechanical projects and services division, its second big business segment after cooling products. Revenues at the division dropped 17 per cent due to slowdown in project execution, hitting operating performance.

The segment results show a sharp fall in operating earnings. ‘Slow execution pace contributed to the revenue decline and margins reflect conservative time-based provisions made amidst liquidity constraints. We believe some expected credit losses might have also been booked, though this clarity we will await for from the results call,’ adddd Jefferies.

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