Author: Sarika Patil

Weekly News Summary

6th June 2025

Market data as on 6th June 2025

The U.S. markets traded higher during the week as job openings in the U.S. unexpectedly increased in the month of April. Job openings climbed to 7.391 million in April from an upwardly revised 7.200 million in March.

The US and China appear to have different understandings of what was agreed on rare earths at last month’s trade talks in Geneva, according to an expert on critical minerals policy.
US tariffs of 50 per cent on steel and aluminium have come into force on Wednesday, a day after President Donald Trump signed an executive order escalating his global trade war.
About $22 billion of SpaceX’s government contracts are at risk and multiple U.S. space programs could face dramatic changes in the fallout from Elon Musk and President Donald Trump’s explosive feud on Thursday.
U.S. jobless claims unexpectedly rise to nearly eight-month high: Initial jobless claims climbed to 247,000, an increase of 8,000 from the previous week's revised level of 239,000. Street had expected jobless claims to dip to 235,000.
Trade deficit in U.S. narrows substantially in April: The U.S. trade deficit narrowed to $61.6 billion in April from a revised $138.3 billion in March. Street had expected the trade deficit to shrink to $94.0 billion.
U.S. services index unexpectedly indicates slight contraction in May: The Institute for Supply Management (ISM) said its services PMI fell to 49.9 in May from 51.6 in April. Street had expected the index to inch up to 52.0.
Labor productivity in U.S. slumps 1.5% in Q1: Labor productivity slumped by 1.5 percent in first quarter compared to the previously reported 0.8 percent decline. Street had expected the decrease by labor productivity to be revised to 0.7 percent.
U.S. private sector employment rises much less than expected in May: ADP said private sector employment rose by 37,000 jobs in May after climbing by a downwardly revised 60,000 jobs in April.

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Crude Oil
U.S. President Donald Trump said that Russian President Vladimir Putin was not ready for an immediate peace in Ukraine and is planning to retaliate for Kyiv's drone attack on his country's bomber fleet. Besides, investors looked past concerns about oversupply, with Saudi Arabia pushing for a major increase in oil production and slashing prices for Asian buyers, signaling weaker demand.
As per a private report, one Canadian operator restarted a site after shutting down last week. Besides, disappointing U.S. economic data also weighed on oil prices, with separate reports showing weaker than expected private sector job growth and an unexpected contraction by service sector activity.
ongoing concerns about supply due to escalating geopolitical tensions and stuttering U.S.-Iran nuclear talks. France and Germany have called on the U.S. to enact sanctions targeting Russia if Moscow remains unwilling to cease hostilities in Ukraine. Besides, wildfires in Canada's energy heartland of Alberta have shut down almost 350,000 barrels of daily heavy crude production, which is about 7 percent of the country's output.

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Global News
European markets were trading mostly in red as investors awaited the U.S. Labour Department's closely watched monthly jobs report later in the day for more insight into the labor market and the outlook for monetary policy. Asian markets settled mixed on Friday despite the leaders of the U.S. and China agreeing to further talks aimed at reaching a deal.
ECB cuts interest rates by 25 bps: The Governing Council, led by ECB President Christine Lagarde, lowered the deposit facility rate by a quarter basis point to 2.0 percent.
Eurozone private sector expands for fifth month: The final results of the purchasing managers' survey by S&P Global showed that the final HCOB composite output index fell to 50.2 in May from 50.4 in April.
Eurozone Inflation falls: The figures from Eurostat revealed that inflation softened more-than-expected to 1.9 percent in May from 2.2 percent in April. The rate was expected to slow to 2.0 percent. Euro area jobless rate eases to 6.2% as expected: Eurozone unemployment rate fell for the first time in four months in April. The seasonally adjusted jobless rate dropped to 6.2 percent from 6.3 percent in March.
German manufacturing orders rise unexpectedly: Factory orders rose 0.6 percent month-on-month in April, following a revised 3.4 percent rise in March. This was the second consecutive month of growth.
Japan's exports fall in first 20 days of May: Japan’s exports fell in the first 20 days of May as Donald Trump's administration sweeping tariffs continued to disrupt trade. Exports measured by value dropped 3% from the same period a year earlier.
China’s factory activity shrinks in May: China’s manufacturing activity in May shrank at its fastest pace since September 2022. The Caixin/S&P Global manufacturing purchasing managers’ index came in at 48.3, dropping sharply from 50.4 in April.
China’s services sector grows more than expected in May: China’s services sector grew more than expected in May. The Caixin China services PMI rose to 51.1 in May, improving from the 50.7 seen in the prior month
South Korea’s new president vows to pursue talks with North Korea: South Korea’s new President Lee Jae-Myung vowed to restart dormant talks with North Korea and bolster a trilateral partnership with the U.S. and Japan.

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India
Market data as on 6th Jun 2025
RBI cuts inflation projection to 3.7%: The RBI cut inflation projections for the current fiscal to 3.7 per cent from the earlier estimate of 4 per cent, as it expects core inflation to remain benign with the easing of international commodity prices. The sub-4 per cent average retail inflation projection is the lowest in recent years.
RBI rate cut boosts affordable housing sales: CREDAI President Shekhar G Patel said the RBI’s decision to cut repo rate by 50 basis points will improve consumers' sentiment, immensely benefitting mid-income and affordable housing segments, which have been struggling in the last few years.
Piyush Goyal proposes to develop industrial conclave for Italian businesses in India: With an aim to promote investments, Commerce and Industry Minister Piyush Goyal has proposed to develop an industrial conclave for Italian businesses in India. He said Italian companies can consider setting up manufacturing units and offices in those enclaves.
Gross GST collections grow 16.4% in May: The Gross GST collections has grown 16.4% in May to over Rs 2.01 trillion as compared to Rs 1.72 trillion in May 2024. It has remained above the Rs 2 trillion mark for the second month in a row. Meanwhile, April 2025 recorded the highest Gross GST collection of Rs 2.37 trillion
India’s manufacturing activity slows down slightly in May: India’s manufacturing activity slowed down slightly in the month of May 2025 with HSBC India Manufacturing Purchasing Managers' Index (PMI) falling to three-month low of 57.6 from 58.2 in April 2025 amid softer growth of new orders and production. India’s services sector maintains gaining momentum in May: India’s services sector maintained gaining momentum in the month of May 2025, amid higher exports with the strongest improvements in international demand.

Indian equity benchmarks continued their strong upward momentum for the third straight session on Friday as investors cheered a 50 basis points repo rate cut by the Reserve Bank of India's Monetary Policy Committee (MPC). Following the rate cut, the key policy rate eased to a three-year low of 5.5 per cent, providing relief to home, auto and corporate loans borrowers.

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Source: Company data, Institutional Research	Company Snapshot / Havells India Ltd. (Havells) is the leading manufacturer of fast moving electrical goods and major power distribution equipment. The company is head quartered in Noida and having presence across geographies. Havells enjoys enviable market dominance across a wide spectrum of products, including Industrial & Domestic Circuit Protection Devices, Cables & Wires, Motors, Fans, Modular Switches, Home Appliances, Air Conditioners, Electric Water Heaters, Power Capacitors, CFL Lamps, and Luminaires for Domestic, Commercial and Industrial Applications. The company has very strong distribution network not only in India but also across the geographies. The company has 12 state-of-the-art manufacturing plants in India located at Haridwar, Baddi, Sahibabad, Faridabad, Assam, Alwar and Neemrana, manufacturing globally acclaimed products, synonymous with excellence and precision in the electrical industry. / Investment Rationale / Favorable market conditions and strong demand will help them to grow / Indian economy is improving with the higher momentum. It is one of the fastest growing economies in the world. This growth helps to create greater per capita income and also the stronger demand. With the increasing robustness of the market, there is huge opportunity for the electrical goods and consumption businesses. Total domestic market size of electrical segment is approximately Rs.45, 000crs. According to the company and the industry resources the electrical segment vertical likely to grow by 12% CAGR for next 5 years. The home appliances vertical is also having great demand for from the domestic market. The market size has increase with the higher momentum and will also likely in the upcoming future. Total market size of the home appliances is at Rs.70,000 Crs. And will likely to grow by 15% CAGR in the next 5 years. / Robust business structure gives edge over its peers / Havells owns some of the most prestigious brands like Havells, Lloyd, Crabtree, Standard and Promptec. Its network constitutes of 4000 professionals, over 7575 dealers and 40 branches in the country. Its products are available in 40 countries. The company has 12 state-of-the-art manufacturing plants in India located at Haridwar, Baddi, Sahibabad, Faridabad, Assam, Alwar and Neemrana, manufacturing globally acclaimed products, synonymous with excellence and precision in the electrical industry. Havells along with its brands have earned the distinction of being the preferred choice of electrical products for discerning individuals and industrial consumers both in India and abroad. Havells offers same quality products for both Indian and International markets. It is committed to keep powering the world with its state-of-the-art innovations and energy-efficient solutions. Currently over 90% of its product offerings are energy efficient and manufactured in-house. / Valuation / At the CMP of `661, Havells is trading at 50.4x, and 39.06x its FY19E, and FY20E EPS of `13.16 and `17.00. Compared to its peers; Havells is trading at a discount P/E multiple, although its margins are better than or comparable to peers. We initiate coverage on Havells India Ltd with a BUY rating and attach a multiple of 47.6 xs to Havells’ FY20E earnings (EPS) to arrive at the target price of `809, indicating a potential upside of 22%.

Source: Company data, Institutional Research	Company Snapshot / Havells India Ltd. (Havells) is the leading manufacturer of fast moving electrical goods and major power distribution equipment. The company is head quartered in Noida and having presence across geographies. Havells enjoys enviable market dominance across a wide spectrum of products, including Industrial & Domestic Circuit Protection Devices, Cables & Wires, Motors, Fans, Modular Switches, Home Appliances, Air Conditioners, Electric Water Heaters, Power Capacitors, CFL Lamps, and Luminaires for Domestic, Commercial and Industrial Applications. The company has very strong distribution network not only in India but also across the geographies. The company has 12 state-of-the-art manufacturing plants in India located at Haridwar, Baddi, Sahibabad, Faridabad, Assam, Alwar and Neemrana, manufacturing globally acclaimed products, synonymous with excellence and precision in the electrical industry. / Investment Rationale / Favorable market conditions and strong demand will help them to grow / Indian economy is improving with the higher momentum. It is one of the fastest growing economies in the world. This growth helps to create greater per capita income and also the stronger demand. With the increasing robustness of the market, there is huge opportunity for the electrical goods and consumption businesses. Total domestic market size of electrical segment is approximately Rs.45, 000crs. According to the company and the industry resources the electrical segment vertical likely to grow by 12% CAGR for next 5 years. The home appliances vertical is also having great demand for from the domestic market. The market size has increase with the higher momentum and will also likely in the upcoming future. Total market size of the home appliances is at Rs.70,000 Crs. And will likely to grow by 15% CAGR in the next 5 years. / Robust business structure gives edge over its peers / Havells owns some of the most prestigious brands like Havells, Lloyd, Crabtree, Standard and Promptec. Its network constitutes of 4000 professionals, over 7575 dealers and 40 branches in the country. Its products are available in 40 countries. The company has 12 state-of-the-art manufacturing plants in India located at Haridwar, Baddi, Sahibabad, Faridabad, Assam, Alwar and Neemrana, manufacturing globally acclaimed products, synonymous with excellence and precision in the electrical industry. Havells along with its brands have earned the distinction of being the preferred choice of electrical products for discerning individuals and industrial consumers both in India and abroad. Havells offers same quality products for both Indian and International markets. It is committed to keep powering the world with its state-of-the-art innovations and energy-efficient solutions. Currently over 90% of its product offerings are energy efficient and manufactured in-house. / Valuation / At the CMP of `661, Havells is trading at 50.4x, and 39.06x its FY19E, and FY20E EPS of `13.16 and `17.00. Compared to its peers; Havells is trading at a discount P/E multiple, although its margins are better than or comparable to peers. We initiate coverage on Havells India Ltd with a BUY rating and attach a multiple of 47.6 xs to Havells’ FY20E earnings (EPS) to arrive at the target price of `809, indicating a potential upside of 22%.

CMP (`)	Target (`)
661	809

Potential Upside	Absolute Rating
22%	BUY

Market Info (as on September 06, 2018)
BSE Sensex	38,018
Nifty S&P	11,477

Stock Detail
BSE Group	A
BSE Code	517354
NSE Code	HAVELLS
Bloomberg Code	HAVL IN
Market Cap (`bn)	415.34
Free Float (%)	38%
52wk Hi/Lo	728.95 / 454.00
Avg. Daily Volume (NSE)	555,063
Face Value / Div. per share (`)	1.00 / 3.00
Shares Outstanding (mn)	625

Promoters	Public	Others
59.55	40.45	0.01

Financial Snapshot (`mn)
Y/E Mar	FY17	FY18	FY19E	FY20E
Net Sales	61,558	81,464	97,757	1,17,308
EBITDA	8,182	10,434	12,708	15,954
PAT	4,941	6,735	8,232	10,631
EPS	7.91	10.77	13.16	17.00
ROE (%)	15%	18%	20%	22%
ROCE (%)	20%	23%	25%	29%
P/E	58.1	66.5	54.4	42.1
EV/EBITDA	34.4	42.7	34.9	27.7

Share Price Performance

Rel. Perf.	1Mth	3 Mths	6Mths	1Yr
Havells (%)	3.04	25.2	30.6	34.1
Sensex (%)	(4.7)	2.1	5.1	25.0

CMP (`)	Target (`)
661	809

Potential Upside	Absolute Rating
22%	BUY

Market Info (as on September 06, 2018)
BSE Sensex	38,018
Nifty S&P	11,477

Stock Detail
BSE Group	A
BSE Code	517354
NSE Code	HAVELLS
Bloomberg Code	HAVL IN
Market Cap (`bn)	415.34
Free Float (%)	38%
52wk Hi/Lo	728.95 / 454.00
Avg. Daily Volume (NSE)	555,063
Face Value / Div. per share (`)	1.00 / 3.00
Shares Outstanding (mn)	625

Promoters	Public	Others
59.55	40.45	0.01

Financial Snapshot (`mn)
Y/E Mar	FY17	FY18	FY19E	FY20E
Net Sales	61,558	81,464	97,757	1,17,308
EBITDA	8,182	10,434	12,708	15,954
PAT	4,941	6,735	8,232	10,631
EPS	7.91	10.77	13.16	17.00
ROE (%)	15%	18%	20%	22%
ROCE (%)	20%	23%	25%	29%
P/E	58.1	66.5	54.4	42.1
EV/EBITDA	34.4	42.7	34.9	27.7

Share Price Performance

Rel. Perf.	1Mth	3 Mths	6Mths	1Yr
Havells (%)	3.04	25.2	30.6	34.1
Sensex (%)	(4.7)	2.1	5.1	25.0