In conversation with Sandeep Sikka, Group CFO, Somany Impresa Group (SHIL)

Our e-commerce focus has resulted in the overall growth of the business as online presence elevates our brand and product visibility, affirms Sandeep Sikka, Group CFO, Somany Impresa Group (SHIL).

What is your outlook on the Indian consumer durables industry? What are the key emerging trends you are witnessing among consumer’s post-pandemic?  

India’s consumer durables industry continues to rise on a positive growth trajectory and we see this trend continuing in 2022. Today, consumers are seeking products that make their life easier and help them multitask. New-age consumers are more interested in automated, technologically superior products. In our consumer appliances business, we have seen an uptick in the sales of our range of IoT (internet of things) products across the water heater, water purifier, and chimney categories. The new normal has accelerated the growth of high convenience products such as dishwashers, food waste disposers, ovens amongst others. In addition to it, given more people are going to be working from home now, cooling products such as air coolers in summers and room heaters in winters will see a rise.   

In bathroom space, we have seen touchless products are the need of the hour. The category is expected to see a massive jump soon, as hygiene-conscious consumers will look to replace their normal toilet seat with a touchless one. Touchless sanitaryware by Hindware allows for hands-free access and features an easy-to-use mechanism that ensures touch-free flushing. The future of the segment is bullish and we at Brilloca are expanding our portfolio of intelligent toilets and sensor enabled EWC (embedded wireless controller) to keep addressing the needs and concerns of our customers. 

According to you, which business segment has performed well in the latest quarter ended September 30, 2021? What factors have contributed the most to help you outperform? 

Starting with Q2FY22 performance, our consolidated revenue from operations stood at Rs 617 crore, registering a robust growth of 56 per cent YoY and 80 per cent sequentially. EBITDA for the quarter stood at Rs 58 crore, having grown by 41 per cent YoY and 2.4 times on a sequential basis. PAT for the quarter came in at Rs 25 crore; registering a growth of 28 per cent on a YoY basis. All our business divisions have performed well. Details of the same are as follows-  

• Building Products Division revenue came in at Rs 484 crore, registering a growth of 66 per cent YoY and 82 per cent sequentially. Our innovative product portfolio coupled with improving real estate demand has aided this stellar revenue growth.  
• Revenue for the Consumer Appliances business was Rs 112 crore, up 35 per cent YoY and 66 per cent sequentially. 
• Retail business revenue stood at Rs 21 crore, growing by 6 per cent YoY and 1.2 times sequentially. 

You have mentioned enhancing distribution reach as one of your future priorities. Can you brief regarding your plans to expand the distribution reach in the coming quarters to strengthen the company's growth? 

We are the only company in India with three distinct distribution channels i.e. sanitaryware and faucets, consumer appliances and hardware (pipes). Across our businesses under Somany Home Innovation Limited (SHIL), we currently have over 35,000 plus retail touch points, more than 3,100 distribution partners, 700 plus modern and retail outlets. Our omni-channel along with expansion of distribution channel has resulted in significant growth in sales. Over the years, we have strategically solidified our presence in metros and have also identified opportunities in tier 2 and 3 cities to open our stores, ensuring we go deeper into the country and widen our network.  

The pandemic reinforced the importance of being present on online platforms where we already have a significant presence. Our e-commerce focus has resulted in the overall growth of the business as online presence elevates our brand and product visibility, which, in turn, helps our offline partners. Our hyper-local approach, under which we have connected many of our offline distributors with our B2C e-commerce channel has been successful and we continue to work on the same. Hence, even our offline distributors get to be a part of the growth story created by e-commerce.

What are your top strategic priorities? 

We understand the evolving consumer behaviour and offer a well-differentiated and diverse suite of products to cater to their needs across segments such as consumer appliances, building products (sanitaryware and faucets), and retail; where we are present. Our uniquely designed differentiated product mix helps us to introduce products that are high on both style and comfort. Our strong distribution network across multiple channels, allows us to localize our services to serve customers among the affluent not only in big cities, but also the aspirational classes in the smaller towns of India. It not only helps us to service existing markets but also reach out to newer markets. Additionally, we are harnessing distinct distribution networks to market newer products and cross-sell to our existing customer base.