• Margin and pricing: Net margins were compressed by higher advertising and promotion spends following subdued spending last year, but overall margins are expected to normalize across the year. By the end of the first quarter, the company fully passed on input cost increases, including an average 7% to 8% hike in consumer product categories.
• Switchgear export impact: Disruption from the West Asia crisis led to export de-growth in the Middle East and Africa, though management expects resilient domestic demand to offset ongoing export pressures.
• Lloyd inventory clearance: Despite headwinds from new BEE ratings and raw material volatility, excess channel inventory was cleared by the end of the first quarter, establishing expectations for reasonable forward demand.
• Cables and wires: New organized entrants are viewed positively for formalizing the market away from unorganized competitors, while Havells plans to continue investments in capacity, branding, and distribution to protect and expand market share.