Daybreak The price Havells paid to become a household name
Nov 25, 2025
Havells' acquisition of Lloyd has turned into a significant challenge. Revenue dropped 18% recently due to unsold air conditioners and new energy-efficiency regulations. A short summer and GST rate cuts further stalled sales, creating inventory issues. Despite tripling revenue, Lloyd's margins plummeted from 17% to -7%. Heavy investments in marketing and plant capacity did not translate into sustainable growth. Now, with its market status at risk, the company faces a tricky path ahead.
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Growth Came At The Cost Of Margins
- Havells' acquisition of Lloyd gave scale but eroded margins as aggressive discounting and dealer incentives grew.
- Lloyd's operating margin fell from ~20% to -7%, shifting Havells' profitability despite revenue growth.
Big Capital, Little Market-Movement
- Havells has poured over ₹3,000 crore into Lloyd, more than into all other verticals combined.
- Despite the capital, Lloyd remains the third-largest AC brand, unchanged since acquisition.
Regulation And Weather Drove Inventory Pileup
- New BEE efficiency rules and an unexpectedly short summer caused inventory pileups for Lloyd.
- Average days to clear inventory rose ~10 days, pushing working capital and clearance pressure.