Walton Hi-Tech Industries valuation report: fair value BDT 90–306 (Oct 2026)

Investment case: Walton earns a 32.7% gross margin at 15% VAT; the price implies ~10x taxed earnings

Walton Hi-Tech Industries is Bangladesh's largest maker of refrigerators, and its earnings now hinge on three policy and credit levers more than on demand. In FY2026 (year to 30-Jun-2026) net revenue rose 4.6% to Tk 74.0bn and profit after tax rose 8.5% to Tk 11.2bn, but only because finance costs fell by Tk 2.7bn; gross profit fell 5.1% as the production VAT on fridges and air conditioners doubled to 15% [1 p.54] [1 p.76]. We forecast EPS of Tk 40.17 in FY27F and Tk 45.96 in FY28F (FY26: Tk 30.68 on post-bonus shares) [16].

The five drivers we quantify:

• Fridge volume and share. Walton sold 1.60m fridges and freezers in FY26, 57% of its 2.8m capacity [1 p.97] [2 p.382]; it holds roughly 75% of the domestic market (The Daily Star) or 'more than two-thirds' (The Business Standard) [9] [10]. We model units +3% in FY27F and +5% a year after.
• VAT. The FY2026-27 budget proposes cutting production VAT on locally made fridges, freezers and ACs from 15% to 7.5% until 30-Jun-2030 [12] [11]. If Walton passes half to buyers, gross margin recovers to 34.8% in FY27F.
• Materials and the taka. Materials are ~49% of net revenue and we assume 70% is priced in US$/EUR. A 10% weaker taka in FY27 costs Tk 8.7 of EPS even after half is recovered in prices.
• Credit sales. Gross receivables are Tk 39.4bn, or 194 days of revenue; the credit-loss allowance is 12.6% of the book [1 p.98]. Credit losses cost Tk 992m in FY26 (Tk 1,419m in FY25).
• Tax. Walton pays no tax on business profit as a Private Hi-Tech Park until 26-May-2028, then 70% is exempt to May-2031 [1 p.106]. We value this separately at Tk 29 per share.

Walton sells 60% of its gross sales as fridges, through its own plazas and dealers

Walton makes most of what it sells in one industrial park at Chandra, Gazipur, and earns most of its profit on fridges. Its product lines are refrigerators and freezers (with captive compressors), air conditioners, televisions, electrical appliances (fans, LED lights, switches, motors), home and kitchen appliances (washing machines, cookers, geysers), elevators, cables and moulds [1 p.61] [1 p.108]. Mobile phones, laptops and PCBs are made by a sister company, Walton Digi-Tech Industries, which is being merged into Walton Hi-Tech (below).

The IFRS 8 segment note shows where the profit is. In FY26 the fridge segment earned Tk 1,155cr of operating profit on Tk 4,451cr of net revenue (26% margin); electrical appliances Tk 106cr (10.6%); TVs Tk 48cr (10.9%); ACs only Tk 25cr (5.0%, from 18.4% in FY25); and 'others' lost Tk 8cr [1 p.61]. Fridges are 60% of net revenue and 87% of segment operating profit, so the model forecasts fridge units and price separately from the other lines.

Distribution and credit. Walton sells through its own showrooms and a dealer network. The largest customer is Walton Plaza, a partnership with common partners and directors, which bought Tk 2,532cr in FY26, 34.2% of net revenue (30.6% in FY25); WES Plaza bought another 1.4% [1 p.121]. Walton Plaza runs the instalment (hire-purchase) sales to households, so Walton's receivables carry the consumer-credit risk of the whole retail chain. The service network has 88 premises and 2,790 staff [1 p.29].

Walton Plaza's balance and terms. Walton Plaza owed Walton Tk 12,740m at Jun-26 (Tk 13,371m a year earlier), 32% of gross trade receivables and about 184 days of its purchases; WES Plaza owed Tk 299m [1 p.121]. The company says these sales are made 'on an arms' length basis as per the company's policies and based on performance like other distributors'; no price list, discount or credit-term comparison is disclosed. In FY25 Walton also bought 1,227 decimals of land from five sponsor directors for Tk 602m [1 p.122].

Ownership. Sponsors and directors own 71.09% (30-Sep-2026), up from 67.09% at 30-Jun-2026; institutions hold 0.97% and foreigners 0.03% [7]. Walton listed in September 2020 by selling about 1% of its shares; DSE's 'public' category (27.91%) includes family members and others outside the sponsor group, so the tradable float is far thinner than that figure suggests. The 4-point rise in the sponsor stake between 30-Jun and 31-Aug-2026 (about 14.7m shares) matches no purchase declaration in DSE news over the period, where the only director transaction was a 1,753-share gift; we read it as a reclassification of holders into the sponsor/director category, not a market purchase (unconfirmed). Daily turnover since the September record date averaged Tk 9.7m (~US$80k), or 0.008% of market value [8].

What is changing. (1) The High Court sanctioned the merger of Walton Digi-Tech Industries on 29-Jul-2026; Walton issues 0.026005 of its shares per Digi-Tech share, about 0.78m new shares for 30m Digi-Tech shares (0.2% dilution) [1 p.124] [6]. Digi-Tech had Tk 10.2bn of revenue and Tk 181m of profit in FY24 [6]. (2) A lithium-ion battery plant, KAPPA compressors under the ACC brand and solar capacity from 26 MW toward 50 MW [1 p.23]. (3) New export distributors in Libya (Jul-2026) and Kenya (Oct-2026) [6].

Demand: 53% of households own a fridge, and Walton holds about 45-80% of a ~2-3.5m unit market

Fridge demand grows with rural electrification and replacement, not with population alone. A 2023 government survey cited by The Business Standard put fridge ownership at 53.4% of Bangladesh's 3.5 crore households (70% urban, 48% rural), with 80% of fridges sold outside Dhaka [10]. The Daily Star (Feb-2026) put the market at Tk 7,350 crore in FY2025-26, growing ~10% a year in value but only ~4% in volume, with no volume growth in the previous year [9].

Walton's share. The two outlets agree that local plants make 95-97% of fridges sold and that Walton is the clear leader: 'roughly 75%' (Daily Star, Feb-2026) and 'more than two-thirds' (TBS, May-2025) [9] [10]. Competitors include Singer (Beko/Arçelik), Vision (Pran-RFL), Jamuna, Minister, Konka/Haiko (Electro Mart), Marcel and imported Samsung and LG. Market-size estimates conflict: Singer's MD put annual demand 'approaching two million units', while TBS cited ~35 lakh. Walton's 1.60m units (incl. ~0.1m exported) are about 75% of the first figure and ~45% of the second, so we show share as a range.

Competition is weak at the top. Singer Bangladesh, the second listed maker, had H1 2026 turnover of Tk 14.2bn, operating profit Tk 920m and finance costs Tk 1,581m, a loss of Tk 423m and negative net assets of Tk 2.55 per share [14 p.2] [14 p.12]. A financially stretched number two limits price competition from listed peers; the threat is cheap imports and other local makers when VAT on local production is high. The NBR said the 15% rate led to 'a recent surge in imports of refrigerators' [11].

Other lines. Walton cites a TV share above 30% and AC sales hit by VAT; ACs fell 12% in FY26 to Tk 5.7bn [1 p.108]. Electrical appliances (+12%) and home appliances (+40%) are the growth lines. Exports were Tk 1.35bn in FY26 (+79%), 85% of it fridges and compressors; Walton exported 122,837 units to 64 countries, 87.6% under its own brand [1 p.29] [1 p.108]. We model exports +25% in FY27F, still only 2.0% of revenue.

What moves fridge demand. The market is mostly rural and price-sensitive: basic freezers at Tk 30-45 thousand are the largest segment, inverter models have risen to half of sales, and Walton says four of ten of its freezers are bought by households upgrading [10]. Remittances and farm incomes drive rural purchases, and roughly half of existing owners are expected to replace their fridge within a decade (industry view quoted by TBS). We take that as support for ~4-5% unit growth, the level the Daily Star reports for the industry [9]; our base is +3% in FY27F (the first year after a VAT-driven slowdown) and +5% in FY28-29F.

Pricing. Walton's gross sales per fridge were about Tk 31,900 including VAT in FY26 (Tk 51.1bn across 1.60m units, including exports) [1 p.97] [1 p.108]. We assume underlying price increases of 3-4% a year, below inflation, because local rivals and imports cap prices. The VAT step is modelled separately: if the rate falls to 7.5%, half the fall is passed on and fridge and AC shelf prices drop about 3% in FY27F.

Policy: VAT at 7.5% instead of 15% adds Tk 4.3 of FY27F EPS and Tk 31 of fair value

Local manufacturing of fridges, ACs and compressors has been protected by low production-stage VAT; the protection has been cut twice and is now being restored. The rate was 5% until FY2023-24, 7.5% in FY2024-25 and 15% in FY2025-26 [11]. Walton's VAT bill rose from Tk 6.09bn to Tk 10.29bn, from 8.0% to 12.4% of gross domestic sales [1 p.108]. The FY2026-27 budget proposes 7.5% on refrigerators, freezers and ACs until 30-Jun-2030 [12] [13]; the Finance Act text is not in our sources, so the rate is a labelled assumption.

How we model it. VAT on fridges and ACs = gross sales x rate/(1+rate); other products carry ~11% of gross sales. If the cut is passed in full, shelf prices fall ~6% and margin barely moves; we assume half is passed on, so fridge/AC prices fall 3.0% and Walton keeps the rest. Grid B shows fair value from Tk 183 at 15% to Tk 224 at 5%, at an unchanged taka.

Was the cut enacted? The budget was presented in June 2026 and the fiscal year began on 1-Jul-2026, but we found no allowlisted report or NBR SRO confirming the final Finance Act rate: the coverage we found (Prothom Alo 10-Jun, Financial Express 9- and 12-Jun-2026) describes the cut as proposed [11] [12] [13]. The Q1 FY27 statements (due Nov-2026) will show it in the VAT line. We keep 7.5% in the base and 15% in the bear case. Pass-through is the second unknown: Pran-RFL told Prothom Alo that 'prices will certainly drop' [11]. If the whole cut reaches buyers, FY27F EPS is Tk 3.7 lower and fair value Tk 27 lower than our half-pass base.

Income tax. The Bangladesh Hi-Tech Park Authority declared Walton a Private Hi-Tech Park: 100% of business profit is exempt for seven years from 27-May-2021 and 70% for the next three years [1 p.106]. The effective tax rate was 0.6% in FY26 (Tk 63m on Tk 11.3bn pre-tax profit, all on non-business income) [1 p.113]. We assume a 22.5% statutory rate afterwards (label): the rate on business profit becomes 6.75% in FY29F and ~22.5% from FY32. If the exemption were withdrawn from FY28, fair value falls Tk 23. The other policy items, a 10% regulatory duty on small DC motor imports and lower advance income tax on raw materials (5% to 4%), are small for Walton [12].

Operating drivers: materials are ~49% of revenue, and a 10% weaker taka costs Tk 8.7 of EPS

Gross margin depends on three things: VAT, imported components and how much stock is built or released. Cost of goods sold was Tk 49.8bn in FY26: materials Tk 35.4bn, factory wages Tk 3.3bn, overheads Tk 8.5bn including Tk 3.2bn depreciation, and a Tk 2.7bn release of finished goods and WIP [1 p.109]. Materials including stock change were 51.4% of net revenue in FY26 and 47.3% in FY25 (when stock was built); we start from the two-year average of 49.3%.

Imported components and FX. Walton imports steel, copper, compressor parts, panels and chips and pays through acceptances (deferred LCs): US$137.2m of short-term and US$13.6m of long-term foreign-currency loans at Jun-26 [1 p.119]. The taka was stable in FY26 (FX gain Tk 100m vs a Tk 1,236m loss in FY25) [1 p.112]. We assume 70% of materials are priced in US$ or EUR (labelled; no split is printed) and a 3% annual taka crawl.

Capacity and capex. Installed capacity is 2.8m fridges, 3.2m compressors, 150k ACs, 0.8m TVs, 360k washing machines and 600 elevators [2 p.382]. FY26 sales of 1.60m fridges, 96,836 ACs and 190,759 TVs leave room to grow without new lines [1 p.97]. Cash capex was Tk 3.8bn in FY26 and Tk 5.2bn in FY25 [1 p.78]; we model Tk 4.0-4.5bn a year for the battery plant, solar and maintenance, below depreciation plus inflation. The FY26 stock dividend was 'to finance the ongoing capacity expansion of Green Energy' [6].

History: revenue fell 2.4% a year FY22-26 while net finance cost swung from 5.7% to 2.4% of revenue

Walton's last five years were shaped by the dollar crisis, not by demand. Net revenue went from Tk 81.7bn in FY22 to Tk 66.4bn in FY23 (-18.7%), back to Tk 75.1bn in FY24 and Tk 74.0bn in FY26 [1 p.54]. Gross margin ranged 32.5-38.1%. Net profit fell to Tk 7.8bn in FY23 when net finance costs (including FX losses) reached Tk 7.5bn, and recovered to Tk 11.2bn in FY26 as loans were repaid.

Normalised returns vs history. Reported ROE averaged 10.1% over FY22-26 (median 9.1%, range 7.6-12.4%) on equity that includes Tk 33.7bn of land revaluation; ex-revaluation ROE was 12.4% in FY26 and would be 9.6% at a 22.5% tax rate [16]. Our FY27-29F ROE of 11.2%-12.0% is at the top of the five-year range because the forecast assumes the VAT cut and low interest costs; we treat that as recovery to the FY24 level, not a new normal.

Earnings quality: operating cash covered 189% of profit in FY26, but receivables are 194 days

Cash conversion improved, the credit book did not shrink. Operating cash flow was Tk 21.2bn in FY26 (Tk 17.6bn in FY25), helped by a Tk 5.7bn cut in inventories [1 p.78]. Gross trade receivables were Tk 39.4bn at Jun-26, flat on the year, of which Tk 16.6bn (42%) was older than six months [1 p.98]. The credit-loss allowance rose to Tk 4.98bn (12.6%), and write-offs were only Tk 4m.

Consumer credit and bad debt. Walton provisions 0.94-1.78% on current balances, 2.7% on dealer balances 1-2 years old and 50% on balances older than two years (80% in FY25; cut because collections improved) [1 p.98]. The cut in the rate for old balances lowered the FY26 charge; we model a 3.0% charge on the gross book (FY26 2.5%, FY25 3.6%) and receivable days falling from 194 to 180 by FY29F. The rate cut on two-year-old balances flattered FY26: the charge fell Tk 427m (Tk 1.2 per share, 3.8% of FY26 profit), though the allowance still rose from 10.1% to 12.6% of the book; balances older than two years are not disclosed, so the exact release cannot be measured [1 p.98]. Our base charge is therefore the two-year average of 3.0%, not FY26's 2.5%. Credit stress (days at 210/205/200 and a 4.0% charge) costs Tk 22 of fair value.

Related parties and governance. Besides Walton Plaza, Walton had a Tk 2.02bn receivable from Walton Digi-Tech at Jun-26 (Tk 80m a year earlier), a 25-fold rise in one year and about six times the valuer's Tk 345m equity value for WDTL [1 p.121] [1 p.124]. It cancels on merger against WDTL's assets, and Walton takes on WDTL's liabilities, which we cannot see; a full loss would cost Tk 5.5 per share. Directors draw no remuneration. The auditor (A. Qasem & Co.) gave a clean opinion; key audit matters included inventory valuation. Emerging Credit Rating affirmed AAA/ST-1 in Jan-2026 [6].

Dividend. Walton paid 175% cash plus 10% stock for FY25 and 180% cash (Tk 18.00, Tk 6.0bn) plus 10% stock for FY26; the cash payout was 53% [1 p.55] [6]. We assume 53% cash payout and no further stock dividends, which gives DPS of Tk 21.29 in FY27F, a 6.5% yield at Tk 329.6. Stock dividends do not change value but add to a share count that is mostly held by sponsors.

Forecast: units +3-5% and a lower VAT bill lift EPS to Tk 46.0 by FY28F

Each income-statement line has its own driver. Revenue = gross sales by product line (fridge units x price, AC units x price, value growth for the other lines) + exports - returns - VAT. Materials follow volume, US$ component prices and the taka; wages and overheads grow 5-6%; selling costs are 11% of revenue; credit losses follow the receivables book; interest is 8% of opening loans; tax follows the exemption schedule [16].

The balance sheet and cash flow follow the same drivers. Inventory is held at 180 days of cost of goods sold (175 in FY26, 239 in FY25), receivables at the scenario's days, payables at 16 days and provisions at 7.7% of revenue. Working capital absorbs Tk 6.1bn in FY27F and Tk 7.6bn in FY28F as sales grow. Capex of Tk 4.0-4.5bn is below operating cash flow of Tk 14.2-19.9bn, so after dividends the surplus repays acceptances: short-term loans fall from Tk 16.2bn to Tk 13.2bn in FY27F and net debt falls to Tk 7.9bn in FY28F and Tk 3.3bn in FY29F, as working capital for the merged Digi-Tech business absorbs part of the cash. Interest is charged on opening loans, so there is no circularity [16].

Operating costs. Selling and distribution (ex credit losses) was 11.0% of revenue in FY26: advertising and digital campaigns Tk 1.7bn, route-to-market costs Tk 848m, delivery Tk 759m and after-sales service Tk 560m [1 p.111]. We hold it at 11%. Administrative costs (Tk 1.84bn) grow 8% a year. Factory wages fell 2% in FY26 to Tk 3.29bn and grow 6%; utilities fell to Tk 1.30bn as rooftop solar reached 22% of power use [1 p.109] [1 p.23].

Why FY27F EPS rises 31%. Gross margin returns to 34.8% as VAT falls and materials normalise; revenue grows 16.7%; selling costs and credit losses grow with sales; interest falls as acceptances are repaid from cash flow, but a 3% taka crawl costs Tk 559m of FX loss on US$ liabilities. Tax stays at ~0% until May-2028. In FY29F the 70%-exemption phase raises the tax charge to Tk 1.3bn, so EPS growth slows to 5.9%.

Ours vs history and run-rate. FY27F net profit of Tk 14.8bn is above the FY24 peak (Tk 13.6bn); the FY26 run-rate (Q4 alone Tk 4.8bn) supports a recovery, but the forecast needs the VAT cut. Management gives no numeric guidance: no earnings-call transcript or investor presentation is in our corpus. The annual report's stated aims are exports to 200 countries within five years and the battery plant [1 p.41]; we do not model either beyond our export growth.

Walton Digi-Tech adds ~14% to revenue but under 2% to profit, for 0.2% more shares

Phones, laptops, PCBs and IT accessories come into Walton Hi-Tech through the merger of Walton Digi-Tech Industries (WDTL), a sister company owned by the same sponsors. The board endorsed the plan on 3-Sep-2025, BSEC gave a no-objection on 15-Mar-2026, the shareholders' EGM was set for 3-Jun-2026 and the High Court sanctioned it on 29-Jul-2026 [6] [1 p.124]. The independent valuer (ACNABIN) put WDTL at Tk 11.50 per share and Walton at Tk 442.21 per share at 30-Jun-2025, giving 0.026005 Walton shares per WDTL share [1 p.124].

Size. WDTL's paid-up capital is Tk 300m (30m shares), so about 0.78m new Walton shares will be issued, 0.2% of the 366.5m outstanding. Its last disclosed accounts (FY24) show net revenue of Tk 10.16bn and net profit of Tk 181m, a 1.8% margin [6]. That is ~14% of Walton's FY26 revenue but under 2% of its profit: mobile phone and laptop assembly is a thin-margin business compared with Walton's 26% fridge segment margin [1 p.61]. Under the significance rule (10% of revenue) WDTL counts, so we show it separately: its revenue and costs are inside the forecast (12% gross margin, 1.8% net margin, both assumptions) and inside the DCF.

Tax on Digi-Tech's profit. We tax the merged business at Walton's Hi-Tech Park rate (0% until May-2028). Whether the exemption extends to the Digi-Tech business after the merger is not disclosed; at a full 22.5% rate the difference is about Tk 0.1 per share of FY27F EPS. How we model and value it. We assume the merger takes effect from 1-Jan-2027 (half of FY27F revenue, Tk 5.1bn) and that WDTL keeps its FY24 margin: profit of Tk 91m in FY27F and Tk 192m in FY28F. Two balance-sheet points matter more than its profit: Walton was owed Tk 2.02bn by WDTL at Jun-26 (Tk 80m a year earlier), which is eliminated on merger and is a risk if WDTL's assets do not cover it (Tk 5.5 per share if fully lost), and WDTL's own debt and working capital, which we cannot see because its FY25 and FY26 statements are not in our corpus [1 p.121].

Valuation: Tk 90-306; base 213 = 5.3x FY27F EPS

We value Walton with a DCF (60%) and a P/E on tax-normalised earnings plus the value of the tax holiday (40%). The DCF gives Tk 231 per share; the P/E leg gives Tk 186 (a justified 5.02x, = 53% payout / (cost of equity 16.6% - g 6%), on FY27F EPS of Tk 31.40 at a 22.5% tax rate, plus Tk 29 for the remaining exemption). The blend is Tk 213; the probability-weighted value of the scenarios is Tk 206. Sum of the parts is not used: there are no subsidiaries, and the merged Digi-Tech business is inside the consolidated forecast. No listed peer is usable: Singer Bangladesh is loss-making with negative equity [14 p.12].

DCF details. FY27-29F come from the forecast; FY30-31F grow revenue 8% at the FY29F EBITDA margin. Tax on EBIT follows the exemption (0% / 0.6% / 6.75% / 6.75% / 8.1%); the terminal year is taxed at the full 22.5%. We deduct net debt at 30-Jun-2026 and the Tk 6.0bn FY26 cash dividend, which belongs to holders on the 20-Sep-2026 record date, because the Tk 329.6 price is ex-dividend.

Why a justified multiple, and how it reconciles with the DCF. Walton listed in Sep-2020, so there is no pre-floor P/E history; FY22-23 year-end P/Es (27.2x, 40.6x) were floor-price years and FY24-26 (14.5x, 13.1x, 11.9x on tax-free EPS) are recent own multiples, so we use neither [1 p.55]. There is no usable sector median (Singer has negative earnings and equity). The justified forward P/E from our own inputs is 5.0x. The DCF implies 6.5x the same EPS (after the holiday value), which at a 53% payout needs 8.3% perpetual growth: the DCF sees 8-9% growth to FY31 and cash conversion that would support a payout above 53%. We weight the DCF 60% because it carries those explicit years and the tax schedule, and the justified P/E 40% because it anchors on the dividend Walton actually pays. The price implies 9.6x tax-normalised FY27F EPS.

Cost of capital. The risk-free rate is the 10-year Treasury bond cut-off of 9.268% (25-Oct-2026) [15]. Beta is 0.90 (Blume-adjusted from a raw 0.85 over two years of weekly returns against DSEX; correlation 0.53, so the fit is weak). We use the house 7% equity risk premium and add 1% for liquidity, as the stock trades ~Tk 10m a day. Cost of equity is 16.6%. Debt is 10% of capital at 9% pre-tax and 22.5% tax, giving a WACC of 15.6%. Terminal growth of 6% reflects fridge penetration of 53% plus 3-4% price, held below inflation because the VAT protection that supports local makers may fade after 2030.

Why the range is wide. The bear case assumes the 15% VAT on fridges and ACs stays permanently, through FY29F and in the DCF's later years. It combines that 15% VAT, a 6% weaker taka, slower units and a heavier credit charge: FY27F EPS of Tk 24.2, close to the FY23 trough (Tk 21.4). The DCF carries that margin forward, so value falls to Tk 90. Uncertainty is High.

Risks: keeping 15% VAT costs Tk 31 and a 10% weaker taka Tk 43 of fair value

Each risk is run through the model with one driver changed and everything else at base.

• VAT stays at 15% (likelihood: medium). Line: VAT and fridge/AC price. Signal: the Finance Act 2026 schedule and Q1 FY27 VAT/gross sales (12.4% in FY26). Mitigant: the proposal runs to 2030 [12].
• Taka falls 10% (medium). Lines: materials (70% imported, 50% passed on) and FX loss on US$150.8m of liabilities [1 p.119]. Signal: BB exchange rate and LC margins.
• Credit losses (medium). Lines: credit-loss charge and receivables. Signal: share of receivables older than six months (42%) and sales to Walton Plaza (34% of revenue).
• Fridge volume (low-medium). Line: units. Signal: import data and Singer/Vision pricing; the NBR blamed 15% VAT for an import surge [11].
• Tax holiday withdrawn or not extended (low). Line: tax. Signal: Hi-Tech Park Authority notices; the exemption runs to May-2031 on its current terms.
• Governance and liquidity (high, not in the numbers). 71% sponsor ownership, related-party sales and Tk 9.7m daily turnover; a minority holder cannot exit quickly at the fair value.
• VAT cut passed to buyers in full (medium). Line: fridge/AC price. FY27F EPS -Tk 3.7, fair value -Tk 27. Signal: Walton and Pran-RFL price lists after July 2026.
• Digi-Tech receivable (low-medium). Line: receivables/equity. Tk 2,018m owed by WDTL at Jun-26; a full loss costs Tk 5.5 per share. Signal: the merger accounts and WDTL's balance sheet.
• Opportunity: exports. +20pp export growth adds only Tk 5: exports are 1.8% of revenue.

What to watch: Q1 FY27 gross margin above 34% would confirm the VAT recovery

• Q1 FY27 results (Nov-2026). Gross margin above 34% (FY26 Q1 32.2%) and VAT below 9% of gross sales → base case on track.
• Finance Act VAT schedule. Confirmation of 7.5% to Jun-2030 → bear case's main driver falls away.
• Receivables. Days below 190 and the >6-month share below 42% at the H1 FY27 report.
• Digi-Tech merger. Effective date, new-share listing and Digi-Tech's latest statements (phones and laptops).
• Taka. Any step move above 5% in FY27 → Tk 8-9 of EPS per 10%.
• Sponsor holdings. Further changes after the rise from 67.09% to 71.09% in Jul-Aug 2026.

Methodology: filings only, line-by-line forecast, two valuation legs

Reported figures come from the FY2026 annual report (statements on pages 75-130 are scanned and were read from the page images), the FY2025 annual report and the FY2026 interims. News is used only for market share and the budget proposal, each from two outlets on our allowlist. Forecasts come from the linked workbook below; scenarios change drivers, not outputs [16].

Gaps: no earnings-call transcript or investor presentation in our corpus; Walton Digi-Tech's FY25-26 statements; FY25 unit sales; the Finance Act 2026 VAT schedule text; an import split of materials; the BB exchange-rate series; Walton Plaza's own accounts and hire-purchase book.

FAQ

What is Walton Hi-Tech's fair value range?

Tk 90-306 per share, base Tk 213, from a DCF (60%) and a justified 5.0x P/E on tax-normalised FY27F EPS plus the tax-holiday value (40%). The price on 29-Oct-2026 was Tk 329.6.

How much does the fridge VAT change matter?

If the 15% rate stays instead of the proposed 7.5%, FY27F EPS is Tk 4.3 lower and fair value Tk 31 lower.

Does Walton pay income tax?

Not on business profit until 26-May-2028 (Private Hi-Tech Park). It then pays tax on 30% of profit until May-2031. We assume a 22.5% rate afterwards.

What is Walton's market share in refrigerators?

About 75% according to The Daily Star (Feb-2026) and more than two-thirds according to The Business Standard (May-2025); on its 1.60m units the share is 45-80% depending on the market-size estimate.

Why are receivables so high?

Walton sells on credit to dealers and to Walton Plaza, a related retailer that runs instalment sales. Gross receivables were Tk 39.4bn (194 days) at Jun-26, with a 12.6% allowance.

What does the Walton Digi-Tech merger do?

It brings phones, laptops and PCBs into Walton for ~0.78m new shares (0.2%). Digi-Tech's FY24 revenue was Tk 10.2bn with a 1.8% margin, so it adds ~14% to sales but little profit; the Tk 2.0bn Walton was owed by Digi-Tech at Jun-26 is a risk.

Is sum of the parts used?

No. Walton has no subsidiaries, and the merged Walton Digi-Tech business (phones, laptops) is inside the consolidated forecast and DCF.

Sources

1. Walton Hi-Tech Industries PLC Annual Report 2025-2026 (audited statements to 30-Jun-2026, A. Qasem & Co., signed 29-Aug-2026) · link · accessed 2026-10-31
2. Walton Hi-Tech Industries PLC Annual Report 2024-2025 · link · accessed 2026-10-31
3. Walton Hi-Tech un-audited Q1 FY2026 statements (to 30-Sep-2025) · link · accessed 2026-10-31
4. Walton Hi-Tech un-audited H1 FY2026 statements (to 31-Dec-2025) · link · accessed 2026-10-31
5. Walton Hi-Tech un-audited 9M FY2026 statements (to 31-Mar-2026) · link · accessed 2026-10-31
6. DSE news archive, WALTONHIL, Nov-2024 to Oct-2026 (dividend, merger, distributor, EGM and record-date notices) · link · accessed 2026-10-31
7. DSE company page, WALTONHIL (shares outstanding, shareholding at 30-Jun, 31-Aug and 30-Sep-2026) · link · accessed 2026-10-31
8. AnalystBro market data: WALTONHIL, SINGERBD and DSEX daily/weekly bars to 29-Oct-2026 (chart_bars, chart_metrics) · link · accessed 2026-10-31
9. The Daily Star, 'Bangladesh's refrigerator industry eyes global expansion', 25-Feb-2026 · link · accessed 2026-10-31
10. The Business Standard, 'Where lies the growth for refrigerator makers?', 20-May-2025 · link · accessed 2026-10-31
11. Prothom Alo English, 'VAT on ACs, refrigerators likely to be halved to 7.5pc', 10-Jun-2026 · link · accessed 2026-10-31
12. The Financial Express, 'Tax cuts, duty holidays to boost local EV and electronics makers' (budget FY2026-27), 12-Jun-2026 · link · accessed 2026-10-31
13. The Financial Express, 'Refrigerator, AC getting cheaper with tax cutbacks', 9-Jun-2026 · link · accessed 2026-10-31
14. Singer Bangladesh Limited un-audited H1 2026 statements (to 30-Jun-2026) · link · accessed 2026-10-31
15. Bangladesh Bank: treasury auction cut-offs (10-yr 9.268%, 25-Oct-2026) and Scheduled Banks Statistics Apr-Jun 2026 Table-102 · link · accessed 2026-10-31
16. AnalystBro model for this report (workbook below) · link · accessed 2026-10-31