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Profit Surge Heats Up Blue Star’s Q4: ₹9 Dividend to Cool Investors
Result Updates - May 8, 2025

Profit Surge Heats Up Blue Star’s Q4: ₹9 Dividend to Cool Investors

Profit Surge Heats Up Blue Star’s Q4: ₹9 Dividend to Cool Investors

Fueled by strong summer demand and a healthy order book, Blue Star announced a more than 20% year-on-year increase in revenue and profit for Q4 FY25. The impressive growth in room air conditioners and project businesses helps maintain momentum into FY26.

Summary:

Blue Star Ltd announced a consolidated net profit of ₹194 crore for Q4 FY25, reflecting a year-on-year increase of 21.5%. This growth was driven by strong demand during the summer months and strategic inventory management by distributors. Revenue from operations grew by 20.8% compared to the previous year, totaling ₹4,018.96 crore. For the entire fiscal year, the company’s net profit surged by 42.7% to ₹591 crore, alongside a revenue achievement of ₹11,976 crore. Blue Star’s board proposed a final dividend of ₹9 per share, underscoring the company’s robust financial position.

Q4 FY25 Results: Robust Growth Driven by Room AC Demand and Project Execution

Blue Star Limited’s performance in the fourth quarter of FY25 showcased robust operational execution and continued consumer interest, especially in its Unitary Products and Electro-Mechanical Projects segments. The company posted consolidated revenue of ₹4,018.96 crore for Q4 FY25, reflecting a 20.8% increase compared to ₹3,327.77 crore in Q4 FY24. The net profit, excluding exceptional items, surged by 21.5% to ₹194 crore, up from ₹159.71 crore in the same quarter the previous year.
Operating profit (PBIDTA excluding other income) rose 15.5% year-on-year to ₹279.40 crore, although the margin slightly declined from 7.3% to 7.0%. This drop was mainly due to increased promotional expenditures in the room air conditioning sector and rising input costs. Nevertheless, the overall operating leverage remained healthy.
Before accounting for exceptional items, the Profit Before Tax increased by 16.2% YoY, reaching ₹248.82 crore. At the same time, other income nearly doubled to ₹23.99 crore, indicating enhanced treasury performance driven by a larger cash surplus.

Full-Year FY25 Performance: Revenue Crosses ₹12,000 Crore Milestone

Blue Star reported a consolidated revenue of ₹11,976.65 crore for FY25, marking a 23.6% year-on-year increase from ₹9,685.36 crore in FY24, highlighting robust growth across its main sectors. The company’s net profit surged by 42.7% year-on-year to ₹591.28 crore, supported by operational efficiencies and a gain of ₹10.37 crore from exceptional items.
Operating profit for FY25 reached ₹875.92 crore, reflecting a 31.8% year-on-year increase and boosting the operating margin to 7.3%. The Earnings Per Share (EPS) grew to ₹28.76, up from ₹20.77 in the previous year.
Finance costs declined 16% year-on-year to ₹48.80 crore due to reduced borrowings and effective working capital management.The company closed the fiscal year with a strong net cash position of ₹640 crore.

Segment Performance: Room AC Business Shines Bright

-Unitary Products Segment: Revenue grew by 22.4% to ₹5,621 crore, with segment profits rising by 30.8% to ₹471.26 crore. The growth was driven by robust channel stocking ahead of summer and the introduction of new premium air conditioning products.
-Electro-Mechanical Projects & Commercial Air Conditioning: Revenue increased by 27.2% to ₹5,998 crore, while profits soared by 43.9% to ₹490.88 crore. This growth was fueled by strong demand from data centers, manufacturing, healthcare, and hospitality sectors. However, commercial real estate and banking, financial services, and insurance (BFSI) segments showed slow performance.
-Professional Electronics & Industrial Systems: This segment encountered challenges, with revenue falling by 7.7% to ₹348.55 crore and profits declining by 42.3% to ₹29.72 crore, mainly due to weak demand in the Data Security and Med-Tech sectors.

Dividend and Shareholder Updates

The board has announced a final dividend of ₹9 per share for FY25, which marks an increase from the ₹7 dividend declared the previous year. The company’s 77th Annual General Meeting (AGM) is on August 6, 2025. The record date to be eligible for the dividend is July 18, 2025, with book closure from July 19 to August 6.

Brokerages Maintain Positive Outlook

Brokerages are optimistic about Blue Star’s prospects. The company boasts a solid order book of ₹6,263 crore, representing a 9.9% increase year-on-year. Analysts expect ongoing earnings growth due to the rising demand for cooling solutions influenced by climate change. Blue Star’s strategic emphasis on innovation, a robust supply chain, and customer-focused solutions is vital for sustainable growth.
Nuvama continues to endorse a “buy” rating for the stock and has updated its target price to ₹1,550. They highlight strong earnings visibility, a trend towards premium products in consumer appliances, and a rise in capital expenditure from government and private sectors in infrastructure as significant contributors.

Future Outlook: Optimism Tempered by Market Volatility

Chairman and Managing Director Vir S. Advani stated, “We’re proud to achieve our third consecutive year of remarkable performance. Although April 2025 started slowly due to milder temperatures, we anticipate strong demand in May and June. The challenges in Commercial Refrigeration are now behind us. With our updated product range and the growth of market segments such as data centers and healthcare,” we are confident in our outlook.”
He also emphasized that the company closely monitors geopolitical risks, fluctuations in global commodity prices, and supply chain issues. Despite these challenges, the company is dedicated to enhancing its manufacturing capabilities and maintaining Star’s leadership position in the Indian Market.

Conclusion

Blue Star’s fourth quarter and full year 2025 results highlight the company’s strong business fundamentals, it’s capacity to adapt to economic fluctuations and its enhanced commitment to innovation and operational excellence. With impressive growth across various segments, a growing product portfolio, and a management set, Blue Star is strategically positioned for ongoing growth in fiscal year 2026. The proposed ₹9 dividend demonstrates management’s confidence in creating shareholder value.

 

 

 

 

 

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LG ‘s IPO Launch in India to help reach its $75 Billion goal

LG ‘s IPO Launch in India to help reach its $75 Billion goal

LG Electronics Inc. is exploring the possibility of an initial public offering (IPO) for its India business, aiming to capitalize on the country’s thriving stock market to help achieve its ambitious target of $75 billion in electronics revenue by 2030. CEO Cho disclosed that joining the Indian market is one of several strategies being considered to renew the company’s consumer durables business. It marks the first time in the South Korean electronics giant, a direct competitor to Samsung Electronics Co., has publicly addressed the prospect of an Indian IPO, a topic that has been the subject of persistent market speculation and media attention.

William Cho, LG’s CEO since 2021 and a 30-year company veteran, has set an ambitious goal for the electronics business. His goal is to reach an annual revenue of 100 trillion won ($75 billion) by 2030, marking a significant expansion for the tech giant. This target represents a significant increase from the company’s overall revenue of approximately $65 billion in 2023. To achieve this growth, LG plans to focus on increasing its revenue from enterprise clients, aiming to derive about 45% of sales from other companies by the end of the decade, up from the current 35%. While acknowledging the increased interest among global investors in a potential IPO in India, Cho emphasized that nothing has been confirmed at this stage, stating, “It is one of many options we can consider.”

The contemplation of an Indian IPO comes at a time when LG is experiencing rapid growth in the country. In the first half of this year, revenue at LG’s Indian unit surged by 14% to a record 2.87 trillion won, while net income saw an impressive 27% increase to 198.2 billion won. The robust activity in India’s capital markets is evident in this impressive showing. A total of 189 companies are set to raise $5.6 billion through initial public offerings this year, positioning India as one of the most vibrant markets for equity fundraising globally. The surge in demand, driven by domestic investment, has prompted at least 30 additional companies to explore potential listings. LG’s Korean counterpart Hyundai Motor Co. is also eyeing a major Indian IPO, with plans to raise up to $3.5 billion.

Cho disclosed that LG is closely tracking Indian market trends, especially concerning IPOs and comparable industry situations. However, he noted that the company has not yet calculated potential valuations for its Indian unit. This cautious approach underscores the strategic importance of the decision and the need for thorough evaluation before proceeding with any public offering.

Beyond the potential Indian IPO, Cho outlined his vision for nurturing new businesses that can each generate more than 1 trillion won in annual revenue. A key focus area is the heating, ventilation, and air-conditioning (HVAC) sector, where LG already operates 11 production sites globally. The company’s chillers, which are large air conditioners designed for buildings, have become particularly crucial for artificial intelligence data centers that are proliferating worldwide in response to the growing demand for generative AI capabilities. Over the past three years, LG has seen its overseas sales of chillers grow by an impressive 40% annually on average.

Another significant initiative is the expansion of LG’s subscription service for home appliances. In Korea, consumers can now rent products such as washing machines and laptops for periods ranging from three to six years by paying a monthly fee. The subscription model has proven popular, with 35% of consumers choosing this option. Building on this success, LG has launched subscriptions in Malaysia and aims to expand to Thailand, Taiwan, and India this year, with future plans for the US and Europe. The company projects that revenue from the subscription business will surge by 60% to about $1.3 billion in 2024.

LG is also setting its sights on the digital content and advertising space, with plans to invest 1 trillion won by 2027 to grow its webOS-based advertising and content business. This includes the expansion of free ad-supported streaming services, leveraging the company’s expertise in consumer electronics to create new revenue streams in the digital media landscape.

Reflecting on his career and vision for LG, Cho, who has worked with the company across North America, Germany, and Australia, emphasized the importance of understanding customers and creating innovative business models tailored to their needs. His global experience has shaped his approach to leading LG into new markets and business areas, positioning the company for growth in an increasingly competitive and rapidly evolving technology landscape.

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