Voltas Transfers ₹61.84 Crore Stake in Saudi Ensas to Singapore Arm – Stock Reacts!

Voltas Ltd has successfully transferred its 92% stake in Saudi Ensas Company for Engineering Services to its Singapore-based subsidiary, Universal MEP Projects Pte Ltd (UMPPL), for ₹61.84 crore. The transaction, completed on February 28, 2025, followed the fulfillment of all regulatory approvals and Conditions Precedent. Despite the transfer, Voltas’ economic interest in Saudi Ensas remains unchanged, as UMPPL is a step-down wholly owned subsidiary of the company.

Following the announcement, Voltas’ stock surged 4% on March 3, 2025, reaching an intraday high of ₹1,373 on the NSE, and continued its upward momentum on March 4, 2025, trading at ₹1,405.25, reflecting a 2.86% gain. The stock has delivered a 23% return over the past year despite a 24% decline in the last six months.

In its Q3 FY25 earnings report, Voltas reported a net profit of ₹130.8 crore, falling short of CNBC-TV18’s estimate of ₹155 crore, while revenue grew 18.3% YoY to ₹3,105.1 crore, surpassing the expected ₹3,015 crore. The company’s EBITDA stood at ₹197.4 crore, with an EBITDA margin of 6.4%, lower than the forecasted 7.1%. Voltas, a market leader in air conditioning, cooling products, and engineering services, currently holds a market capitalization of ₹45,003.63 crore.

The BSE Consumer Durables Index rose 1.3%, with Blue Star gaining 5.8% and Crompton Greaves up 2%. However, Voltas faces ongoing legal challenges, including a ₹402 crore Qatar court ruling, but remains a dominant player in the consumer durables sector.

Voltas Transfers ₹61.84 Crore Stake in Saudi Ensas to Singapore Arm – Stock Reacts!

Voltas successfully transferred its 92% stake in Saudi Ensas to its Singapore-based subsidiary, UMPPL, for ₹61.84 crore. Despite the transfer, the company retains full economic interest in Saudi Ensas, as UMPPL is a step-down wholly owned subsidiary. Following the announcement, Voltas’ stock surged by 4%, reaching an intraday high of ₹1,373 on the NSE. The transaction was finalized on February 28, 2025, after fulfilling all regulatory requirements and approvals. In Q3 FY25, Voltas reported a net profit of ₹130.8 crore, which fell short of market expectations. However, the company’s revenue for the quarter increased by 18.3% year-on-year to ₹3,105.1 crore, surpassing analyst estimates.

Voltas Transfers 92% Stake in Saudi Ensas to Singapore Subsidiary

Voltas Ltd, a leading air conditioning and engineering services provider, has successfully completed the transfer of its 92% stake in Saudi Ensas Company for Engineering Services W.L.L. to its Singapore-based subsidiary, Universal MEP Projects Pte Ltd (UMPPL). The transaction, valued at ₹61.84 crore, was finalized on February 28, 2025, after meeting all Conditions Precedent and obtaining the necessary regulatory approvals.

Despite the change in ownership structure, Voltas clarified that its economic interest in Saudi Ensas remains unchanged since UMPPL is a step-down, wholly owned subsidiary. This means that Saudi Ensas continues to be fully owned under the Voltas umbrella, ensuring the company retains control over its operations in Saudi Arabia.

Financial Performance and Market Response

In its Q3 FY25 earnings report, Voltas reported a net profit of ₹130.8 crore, which was lower than CNBC-TV18’s estimate of ₹155 crore. The company’s revenue from operations grew by 18.3% year-on-year (YoY) to ₹3,105.1 crore, surpassing market expectations of ₹3,015 crore. However, its Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) stood at ₹197.4 crore, falling short of the estimated ₹213 crore. The EBITDA margin improved to 6.4%, a significant rise from 1.1% in the previous year, but still lower than the projected 7.1%.

Following the announcement, Voltas’ stock price closed at ₹1,324.15 on the Bombay Stock Exchange (BSE), marking a 1.01% increase, or a gain of ₹13.20. However, the company has recently faced legal challenges, including a Qatar court ruling that ordered it to pay ₹402 crore in a legal dispute, which had previously led to a 3% drop in its stock price.

As a key player in the consumer durables sector, Voltas continues to navigate international operations and regulatory challenges while maintaining a strong presence in the market.