💰 Financial Performance

Revenue Growth by Segment

Revenue from operations grew by 43.7% YoY, reaching INR 2,756.5 Cr compared to INR 1,918.7 Cr in the previous year. While specific segment splits are not detailed, the growth was driven by a turnaround strategy focusing on product positioning and price consistency across channels.

Geographic Revenue Split

Not disclosed in available documents; however, the company operates a manufacturing unit in Kadi, Gujarat, and maintains a network of local suppliers and branches across India.

Profitability Margins

The company achieved a significant turnaround with a Net Profit Ratio of 2.1% in FY 2024-25, compared to a negative margin of -3.9% in FY 2023-24. This was driven by operational efficiencies and a 43.7% increase in revenue.

EBITDA Margin

The Operating Profit Margin (EBITDA) improved drastically to 5.7% from 0.5% YoY, representing a 1040% increase in margin efficiency. This was attributed to the 'Cost Excellence' pillar of the turnaround strategy which focused on productivity and cross-functional ideation.

Capital Expenditure

Not disclosed in available documents; however, the company reported depreciation and amortization expenses of INR 69.5 Cr for FY 2024-25, up 7.9% from INR 64.4 Cr.

Credit Rating & Borrowing

Finance costs decreased by 65.7% to INR 5.7 Cr from INR 16.6 Cr. The Debt-Equity ratio remained stable and low at 0.1, indicating minimal reliance on external borrowings for operations.

⚙️ Operational Drivers

Raw Materials

Specific raw materials like copper, aluminum, or steel are not explicitly named, but the company refers to 'critical components' and 'local suppliers' as part of its dual-sourcing approach to mitigate supply chain shocks.

Import Sources

The company reported a total foreign exchange outflow of INR 903.88 Cr, up 105% from INR 440.79 Cr, indicating a high dependency on imported components or raw materials from global markets.

Key Suppliers

Not disclosed in available documents; however, the company has established a network of local suppliers and adopted a dual-sourcing approach for critical components to ensure manufacturing stability.

Capacity Expansion

Current installed capacity is not specified in units, but the company operates a manufacturing unit in Kadi and has implemented 'Cost Excellence' to improve productivity across all cost elements.

Raw Material Costs

Not disclosed as a specific percentage of revenue, but the company noted that fluctuating foreign exchange rates and supply chain shocks are primary risks to input costs.

Manufacturing Efficiency

Operational efficiency resulted in a 1040% improvement in operating margins. The company utilizes cross-functional ideation workshops to challenge status-quo and improve productivity.

Logistics & Distribution

Not disclosed in available documents; however, the 'Go-To-Market' strategy focused on ground-up channel planning and price consistency to improve channel advocacy.

📈 Strategic Growth

Expected Growth Rate

13-15%

Growth Strategy

Growth will be achieved through three pillars: 1) Go-To-Market strategy focusing on channel planning and price stability; 2) Quality Excellence ensuring sustainable processes across the value chain; and 3) Cost Excellence focusing on productivity and cost efficiencies. The company also benefits from the indirect acquisition by Robert Bosch GmbH, which will control 74.25% of the share capital.

Products & Services

Air conditioning units and HVAC (Heating, Ventilation, and Air Conditioning) solutions, including energy-efficient redesigned models.

Brand Portfolio

Hitachi (under Johnson Controls-Hitachi Air Conditioning India Limited).

New Products/Services

The company is launching redesigned HVAC products focused on sustainability and energy efficiency, projected to reduce carbon footprint by 1,25,207 MT.

Market Expansion

The company is targeting the Indian air conditioning industry which is poised for steady growth. Strategy includes focused execution on channel advocacy and customer satisfaction.

Market Share & Ranking

Not disclosed in available documents; however, the company describes itself as an industry leader in sustainable HVAC design.

Strategic Alliances

Robert Bosch GmbH (Acquirer) is acquiring 100% of Johnson Controls-Hitachi Air Conditioning Holding (UK) Ltd, which indirectly holds 74.25% of the Indian company.

🌍 External Factors

Industry Trends

The Indian AC industry is growing at 13-15% YoY. Trends include a shift toward energy-efficient products, increased domestic manufacturing to reduce import dependency, and stricter environmental regulations.

Competitive Landscape

The industry is described as one of the most attractive in consumer durables, with the company positioning itself through 'Cost Excellence' and 'Quality Excellence' to compete.

Competitive Moat

The company's moat is built on its 'Hitachi' brand, a dual-sourcing supply chain strategy, and a focus on 'Quality Excellence' across the value chain. Sustainability is maintained through proactive monitoring of regulatory changes like energy efficiency standards.

Macro Economic Sensitivity

The company is highly sensitive to the Indian consumer durables market growth (13-15%) and government policies like Quality Control Orders (QCO).

Consumer Behavior

There is an increasing consumer trust in domestic manufacturing and a demand for energy-efficient, quality-certified (QCO) air conditioning products.

Geopolitical Risks

Geopolitical risks and supply chain shocks are identified as external factors that could impact the availability and cost of critical components.

⚖️ Regulatory & Governance

Industry Regulations

Operations are influenced by Energy Efficiency Standards, Quality Control Orders (QCO), Environmental Laws, and Anti-dumping duties. The company proactively monitors these to manage pricing and operational risks.

Environmental Compliance

The company is aligning with sustainability goals by redesigning products to cut 1,25,207 MT of carbon footprint and complying with energy efficiency standards.

Taxation Policy Impact

The company incurred a tax expense of INR 23.4 Cr in FY 2024-25, compared to a tax credit of INR 23.3 Cr in the previous loss-making year.

Legal Contingencies

The company noted a gap between two Risk Management Committee meetings beyond the SEBI LODR prescribed time limit, for which a clarification was submitted to the NSE.

⚠️ Risk Analysis

Key Uncertainties

Fluctuating foreign exchange rates (INR 903.88 Cr outflow) and potential supply chain shocks represent the primary business uncertainties.

Geographic Concentration Risk

Manufacturing is concentrated in Kadi, Gujarat, making the company dependent on the industrial stability of that region.

Third Party Dependencies

The company relies on a network of local and international suppliers for critical components, mitigated by a dual-sourcing strategy.

Technology Obsolescence Risk

The company manages technology risks through continuous design evolution and R&D focused on energy efficiency and global environmental standards.

Credit & Counterparty Risk

Trade receivables turnover ratio improved by 36.6% to 9.0x, indicating high quality of receivables and timely collection from debtors.