In conversation with Sandeep Sikka, Group CFO of Somany Impresa Group (Hindware Home Innovation)

Strategic initiatives collectively guide our efforts towards sustained growth and reinforce our commitment to meeting customer expectations, expresses Sandeep Sikka, Group CFO of Somany Impresa Group (Hindware Home Innovation)

In Q4FY23, Hindware Home Innovation’s revenue surged by 12 per cent on YoY basis while the net profit dipped by 39 per cent from last year’s same quarter. What were the contributing factors which led to performance?

In the face of a demanding macro environment, we achieved a resilient performance, concluding the year on a positive trajectory. In Q4FY23, our consolidated revenue witnessed a substantial growth of 12 per cent, and we observed an improvement in EBITDA margins from 10 to 12 per cent year-on-year. Within our bath ware business, margins experienced a positive shift from 13 per cent in Q3 to 15 per cent in Q4. Additionally, our plastic pipes and fittings segment achieved an impressive double-digit margin of 11 per cent.

Throughout the year, we remained committed to executing our strategic plan, which encompassed various key initiatives. These included the introduction of innovative products, expanding our distribution network through collaborations with new distributors, establishing brand shops, and extending our presence to tier 4 and 5 towns. Additionally, we made substantial investments in integrated marketing campaigns and advertising to bolster brand awareness and recognition. 

Moreover, we focused on implementing efficient production processes, optimizing supply chain management, implementing cost control measures as well launching new products across categories to enhance profitability. These concerted efforts aligned with our strategy and played a significant role in driving our overall performance for the year.

What is your outlook on the performance of speciality home interior products under the brand name – “Evok” for the next few quarters? 

In the face of a challenging industry environment, where many players are encountering headwinds, we are no exception. However, we maintain a positive outlook and have implemented a well-defined strategy to overcome these challenges and enhance our revenue within the segment.

The Building Products business, encompassing Sanitaryware, Faucets, and Plastic Pipes & Fittings, demonstrated robust growth of 29 per cent in FY23 compared to FY22. What were the factors that significantly contributed to this growth within the segment? Furthermore, what is the company's outlook for the future of this segment?

In the fiscal year 2023, the Building Products sector, encompassing Sanitaryware, Faucets, and Plastic Pipes & Fittings, achieved impressive growth, surpassing the growth rate of the preceding fiscal year, 2022, by a significant margin. 

Our bath ware products' increasing customer loyalty is reflected in this performance, highlighting our commitment to delivering customer satisfaction. In line with our growth strategy, we concentrated on introducing innovative product offerings to meet the evolving demands of our customers. To support our growth objectives, we expanded our distribution network by onboarding new distributors, establishing additional brand shops, extending our presence to tier 4 and 5 towns, and bolstering brand recognition through comprehensive marketing campaigns. 

Furthermore, we emphasized the development of our luxury brand Queo, implementing a dynamic media and promotional campaign during the year. We also introduced an influential Influencer program that rewards architects, aiming to shape consumer preferences and choices.

 In parallel, we prioritised the digital sphere as a key focus area. To that end, we have implemented a series of initiatives, including the introduction of a plumber app and streamlining processes for vendor invoicing, dealers, and distributors.

In FY23, our Plastic Pipes and Fittings brand, Truflo, successfully maintained its position as the fastest-growing brand in its segment. It recorded an impressive 29 per cent increase in revenue, with a 7 per cent year-on-year growth in Q4FY23 and a sequential growth of 11 per cent. This remarkable growth can be attributed to the brand's strong connection with customers, a notable rise in customer loyalty, and the successful launch of a second manufacturing facility. 

We are confident of maintaining this momentum in the future. Equipped with a wide array of a diverse range of products, reinforced by a robust brand presence, and fuelled by a proactive approach to expanding our market reach, we are in an advantageous position to drive sustainable and profitable growth.

What are your top 3 strategic priorities at the moment?  

Our strategic focus remains steadfast, centred on several key priorities. These include the introduction of innovative products across various price segments to effectively address the evolving needs of our consumers. We are committed to expanding our distribution and retail footprint, optimising our supply chain management processes, and implementing measures to control costs, all aimed at maximising profitability. 

Similarly, we will continue to invest in integrated marketing campaigns and advertising to strengthen brand awareness and foster recognition. We understand the immense potential of digital technologies and by embracing digital innovation, we aim to transform various aspects of our operations and customer interactions. This includes implementing advanced e-commerce platforms, enhancing our online presence through targeted digital marketing campaigns, optimizing supply chain and inventory management through digital solutions, and leveraging data analytics to gain valuable insights for informed decision-making. 

These strategic initiatives collectively guide our efforts towards sustained growth and reinforce our commitment to meeting customer expectations.