What Caused Honeywell Automation's Shares to Drop 27% Over the Past Year?
Click to start listening
Synopsis
Honeywell Automation's recent financial results reveal a challenging landscape for the company, with a notable drop in net profit and stock performance. Explore the reasons behind these trends and what they mean for the future of Honeywell Automation in India.
Key Takeaways
- Stock Decline: Honeywell Automation's shares dropped by 27.24% over the past year.
- Q1 FY26 Results: Reported an 8.7% decrease in net profit.
- Revenue Growth: Revenue surged by 23.2% in the same period.
- Cost Pressures: Increased costs affected profitability.
- Sector Focus: The company operates in industrial automation and building management.
Mumbai, Aug 2 (NationPress) Honeywell Automation India Limited has experienced a significant decline of 27.24% in its stock value over the last year, losing Rs 14,692.35, as per the latest data released on Saturday.
In 2025, the stock decreased by 6.89%, despite a slight recovery of 2.95% in the past six months.
On Friday, Honeywell Automation shares closed at Rs 39,021.60 on the Bombay Stock Exchange (BSE), rising by Rs 256.60 or 0.66% for the day.
The company announced its Q1 FY26 results on Friday, reporting an 8.7% year-on-year (YoY) decline in net profit, totaling Rs 124.6 crore for the April-June quarter, compared to Rs 136.5 crore in the same quarter last year (Q1 FY25).
Revenue from operations surged by 23.2% to Rs 1,183 crore, up from Rs 960.4 crore a year earlier, according to its regulatory filing.
However, elevated costs negatively impacted profitability. The company’s operating profit (EBITDA) decreased by 8.4% to Rs 141.3 crore, with the EBITDA margin falling to 11.9% from 16% the previous year.
Total expenses escalated by 28.79% to Rs 1,056.9 crore in the June quarter, as reported in its filing.
The cost of materials consumed surged by 51.39% to Rs 666.3 crore, while employee expenses increased by 17.81% to Rs 216.9 crore.
Finance costs were Rs 1.9 crore, depreciation and amortisation stood at Rs 13.4 crore, and other expenses amounted to Rs 84 crore.
Honeywell Automation India delivers integrated automation and software solutions, with a focus on process and building solutions.
The company operates across various sectors, including industrial automation, building management, and advanced sensing technologies.
HAIL provides process solutions such as distributed control systems (DCS), SCADA, and programmable logic controllers (PLCs) to enhance industrial operations.
Point of View
Honeywell Automation's recent performance raises concerns about external market conditions and internal cost management strategies. While the revenue growth is promising, the decline in profitability indicates potential challenges that the company must address to regain investor confidence. As we continue to monitor these developments, our focus remains on ensuring transparency and informed decision-making in the market.
NationPress
06/10/2025
Frequently Asked Questions
What factors contributed to Honeywell Automation's stock decline?
The stock loss is attributed to rising costs and a decrease in net profit despite revenue growth.
How did Honeywell Automation perform in Q1 FY26?
The company reported an 8.7% year-on-year drop in net profit but a 23.2% increase in revenue.
What sectors does Honeywell Automation operate in?
Honeywell operates in industrial automation, building management, and advanced sensing technologies.
What measures can Honeywell take to improve profitability?
The company may focus on cost reduction, operational efficiency, and exploring new markets.
What are the latest stock prices for Honeywell Automation?
As of Friday, Honeywell's shares closed at Rs 39,021.60 on the BSE.
