Cautious Optimism

Yes, it has a strong brand recall, grown consistently over the past decade and has aggressive expansion plans. So, is Havells India on track to double its revenues by 2022?

- Avishek Banerjee

INDIA’S ELECTRICAL GOODS INDUSTRY has been plagued by demand short-circuit over the past 18 months or so. Hobbled by glitches in the implementation of the Goods and Services Tax (GST) for much of last year, demand for electrical goods and consumer durables suffered further outage due to the liquidity squeeze caused by the ongoing NBFC crisis. An extended winter this year which delayed the purchase of cooling products as well as impending elections added to the woes.

Things are not expected to get better anytime soon as the liquidity crisis is seen lingering for at least a couple of quarters more. So in such circumstances what are the players in the sector supposed to do? Sit quietly and wait for the headwinds to subside or pave the ground for future growth?

Havells India, the largest electrical equipment maker in the country, has taken the demand slowdown in its stride and proceeded to give shape to its long-term growth targets that were firmed up in late 2018. The company, which also makes consumer durable products, is planning to reinvent itself by developing next-generation products and solutions, as part of its target to double its revenues to Rs 20,000 crore by 2022. It has earmarked Rs 1,500 crore to be invested over a five-year period. Out of this, Rs 360 crore is being pumped into an AC manufacturing unit.

“Last financial year, we grew more than 20 percent and have reached Rs 10,000 crore in revenues. So we don’t see that Rs 20,000-crore (revenue) vision as something which is not achievable. Both Lloyd, as well as Havells’ businesses, are on the right growth track,” Anil Rai Gupta, Chairman, and Managing Director, Havells India told BW Businessworld.