Hitachi Energy India Limited

N. Venu

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N. Venu

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N. Venu

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N. Venu

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N. Venu

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Saurabh Shah

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N. Venu

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Saurabh Shah

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N. Venu

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N. Venu

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About 80 percent of our population is yet to be fully vaccinated, while the risk of infections around the festive season remains.

— N. Venu

Fuel prices are record-high and core inflation, which excludes food and fuel, likely indicates impending inflationary pressure.

— N. Venu

While electricity demand is expected to grow 8-8.5% in FY22, risk of a power crisis emanating from coal shortages may dampen supply and impact production at core industries, softening the pace of economic and business revival.

— N. Venu

Customers trust remained rock solid despite difficult market conditions.

— N. Venu

Moving to the Slide #12, Our three-pronged strategy, put in place at the peak of the pandemic, of protecting our people, preserving business continuity and preparing for the new norm, continued to support us in walking uncertain market conditions.

— N. Venu

In this Energy Transition, it is crucial that we take on the challenge of accelerating the pace of change.

— N. Venu

Secondly, on power quality, where you highlighted compared to some of the other focus areas, power quality witnessed some decline.

— Renu Baid

Two, when you sit down with the Japanese Hitachi bosses over there, how would they calibrate success for this company in India and how would you personally calibrate success in your eyes as well and what would be the most difficult part of the journey to get there?

— Jeetu Panjabi

I think the one part is what in this journey will be the most difficult part that indulge you from getting there or what will be the biggest challenge to overcome you have to get there?

— Jeetu Panjabi

The biggest challenge is that we always have this kind of uncertainties like we have seen the COVID wave-1, wave-2, we see a sudden logjams in the port, etc., these are the uncertainties we have to face, so we got to be more resilient, able to take care of those kind of things.

— N. Venu

Q

Good evening, everyone. Thank you for joining us for the call today. I hope all is well at your end and you continue to take all necessary precautions to keep yourself safe and your family members safe. I am going to refer to the slide numbers. We have already uploaded in the stock exchange, just for your information. And if you are able to see the slides also good. India appears to be slowly getting back on track. We see active Covid-19 caseload coming down and more and more people getting vaccinated. We reached the 100-crore milestone yesterday of cumulative doses administered in the country

Management

Q

A couple of questions on the financial Slide #11. Now, slowly, hopefully, if COVID doesn't come back in a meaningful form which affects our operations, what kind of revenue lines do you see for the next three months or how should we look at a normalized kind of a revenue number from Rs.850 crores, last year it was Rs.950 crores, so do you see this trajectory kind of moving up largely or you expect this to be similar in the next two or three quarters, how are you seeing the order execution timelines minus of course any COVID disruptions?

N. Venu

As you know, being a listed company, we don't give any forward-looking statement, but I like to give a little bit of pointers so that you understand. I think with the COVID, as you rightly said, hopefully behind us and we don't see big waves as we have seen previously, we expect the revenue to come back to better than the pre-COVID level. So, the orders kind of intake going up especially on a QoQ basis, do you expect that to accelerate… I am not talking of next couple of quarters, just given the way we had announced the demerger and the focus, are you seeing a slightly higher uptick in the rev

Q

I just wanted to understand what can be a growth rate in each of our end market if I were to think from a five year perspective and therefore how should we think about ABB Power growth rate in that time period? What I am trying to understand is that as we understand apart from data center, the metros, the renewables are anywhere between 5% to 10% kind of a growth market if I understand correctly, I would love to hear your thoughts on this one? And what should be the multiplier at which ABB Power can grow over with market boom?

N. Venu

Again, we will give you a bit of pointers for you to make an assessment. So we are very consistently saying that our strategy is to grow higher than the market. The market is growing at a percentage and we want to grow ahead in the market because we are taking a lot of proactive actions. So, some segments are growing high single digit right now and we see they are slowly moving to close to double digit as economy going up and also the headwinds from COVID will slowly recede. So all these factors put together, these segments will start moving towards high double digit side. So, that is what our

Q

I have a few questions. My first question is on the performance. If we remember right, in 2Q, we had almost Rs.200 crores of slippages in revenue due to COVID second wave. In the second quarter, we were expecting relative improvement in the pace of execution; however, again, because of supply chain challenges, Rs.54 crores short of expectations because of these constraints. So, effectively, are we somewhere looking at execution pace slowing down for us for external matters or we are also seeing customer readiness to accept these deliveries being soft. And by when should we expect revenues comi

N. Venu

It's kind of different set of challenges in this quarter and that's the reason we did miss it, but from a customer side, I don't see any of those limiting factors because I see many of the customers are in fact asking us to accelerate the pace of executions, etc., in that. There could be single digit percentage of the customers not lifting because we also have strict cash over revenue policy. That even though if customers were ready, our materials are ready until customers pay, we will not be in a position to ship it. So that always has a single digit percentage thing is there. But having said

Q

My first question is related to the gross margin for the quarter which is at around 41% which has increased on a year-on-year basis despite raw material prices has gone up significantly. So, any particular reason why gross margin has improved year-on-year despite the commodity variations going against us?

N. Venu

Our CFO, Ajay. You are on the call? Yes. Let me give a color to this. So in the current quarter if you see compared to the earlier quarters, our gross margin improvement has mainly come because of the product mix. It is a product mix that is helping us for the gross margin improvement. Compared to the earlier quarters, if you see our exports and service has improved, that is also contributing for the gross margin improvement. But largely if you see, it is on account of the product mix. Just to add to our CFO, we are showing this Slide #9 continuously, how our strategy is to go towards more pro

Q

I have got a few pointed questions at a high level, right. So, I heard you say that you expect to grow faster than industry. I would love to understand how you articulate your competitive advantages to do that? Two, when you sit down with the Japanese Hitachi bosses over there, how would they calibrate success for this company in India and how would you personally calibrate success in your eyes as well and what would be the most difficult part of the journey to get there?

N. Venu

Very good questions. On the competition side, our competitive advantage which you talked about, as I told you, we are continuously investing in localization of the footprint, investing also to bring our products which so far we are using complete imported products to localize it and third one is we are also improving the skill sets of our people because the shift in the energy transition is making the total portfolios totally different, digital, artificial intelligence base and so on and so forth in that. So, that's the reason we are saying that we are able to take care of the competition with

Q

I understand you have been elaborating every quarter. As to how the synergies between Hitachi India and Hitachi global parent has been improving, if you can help us understand more into how the business prospects have changed and particularly if you can highlight on how the business share on the Lumada platform progress on that?

N. Venu

Again, we have been saying that we started this synergies only after we became part of the Hitachi ownership, because until that it was anti-trust, we were not supposed to exchange and share the information. So we started doing that and the low hanging fruits were high speed rail and those kind of things we are working very closely with them and seeing the movement on the ground is going very well. We also said that Hitachi has invested very heavily on the IoT platform, is very respected IoT platform globally. We would like to leverage that IoT platform and offering our enterprise software sui

Q

Thank you, operator. Once again, ladies and gentlemen, a very big thank you for your patience and taking time from your busy schedule on attending to this conference call. Please reach out to us if you need anything, we are happy to provide and engage with you. And we will be looking for the upcoming investors call. Hopefully, we will see each other face-to-face. And until that please take care, stay safe and also I take this opportunity to wish you all a very happy festival season, Happy Diwali. Thank you.

Management