Blue Star Ltd. shares declined more than 6% after the company reported first-quarter earnings that fell short of market expectations, with operating margins contracting year-over-year.

The company's EBITDA margin for the quarter stood at 5.2%, down from 6.7% recorded in the same period last year. A CNBC-TV18 poll had estimated the margin at 7%, meaning the actual result missed the consensus forecast by 180 basis points.

Blue Star is one of India's largest manufacturers of air conditioning, refrigeration, and MEP (mechanical, electrical, and plumbing) products and services, competing with players such as Voltas, Daikin, and LG in the domestic HVAC market. The company is listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) under the ticker BLUESTAR.

The margin contraction came despite the company operating in a seasonally strong quarter for room air conditioner (RAC) sales, as the April–June period typically represents peak summer demand in India. The Indian room AC market has been experiencing robust demand growth driven by rising disposable incomes, increasing urbanization, and relatively low current penetration levels compared to other consumer durables.

The steep margin decline and the earnings miss relative to the CNBC-TV18 poll estimate prompted a sharp negative reaction in the stock price.

Source: CNBC-TV18 Markets