FY ‘22 was a year that most of us would like to put behind us. The second wave of Covid that began in March’21 hit us with full force in April & May and the impact was devastating. All of us experienced pain, both personally (there was hardly a family that escaped infection) and in our businesses. Rural India, which went largely unscathed during Wave-I, bore the brunt of Wave-2. News and images of patients waiting for hospital beds and suffering due to shortage of oxygen cylinders hurt the national psyche. A vast majority of the population faced trials and tribulations set in motion by shrinking incomes. Consequently, consumer sentiment continued to be below the pre-Covid levels. As a company, we faced headwinds as we are largely into consumer discretionary categories and Capex driven purchases. Market restrictions in Q1 affected the summer demand that appliances companies depend on to meet their annual targets. While we did grow our revenues and the bottomline substantially, our performance was below plan on a YOY basis. Q2 proved to be better because the opening of the markets and offices released pent-up demand. There was optimism in the air notwithstanding elevated commodity costs, higher shipping freight costs and disruption in supply chains. We met both our revenues and profit plans. Q3 was a mixed bag. We saw the wedding season shoring up the revenues of our B2C businesses but even so, the traction from festival sales was subdued, below our expectations. This was partially because of the shift towards the purchase of high end premium priced products where we have a limited portfolio. We were close to our revenue plan but due to rising commodity prices, we could not achieve our profit target. Q4 saw any potential upside due to positive consumer sentiment (caused by the Omicron variant) getting negated by the Russia-Ukraine war.

However, a spectacular March helped us close the year quite well with our revenues growing 24% YOY and profits being 2.7X of FY ‘21.

At the operations level, the most satisfying aspect was the way we managed fixed costs. The level of discipline exercised by our BUs in managing these costs can be readily gauged from the fact that our fixed costs in FY22 were lower than our actuals in FY ’20. Despite all the challenges that we wrestled with in FY ‘22, we never lost sight of the future and to ensure success in the long term, we continued to invest and ploughed back Rs 300 plus crores during the year.

At this juncture, I would like to summarise what we did well in FY ‘22. Let’s keep these close at hand in FY ‘23 and beyond.

We are a strong team that has the courage to keep going no matter what.

Even in the toughest of times, we can think beyond survival and are capable of finding new ways of serving customers, to thrive.

We understand the need to bring down our breakeven volumes so that we do not depend on the last quarter to shape our fortunes. We have learned to rein in and manage our fixed costs

We know more about the forces that are likely to affect our performance and have instituted approaches such as consolidated buying, hedging and value engineering to manage material costs without affecting product quality. We have also learnt ways to raise prices to protect our margins without loss of volumes.

We recognize that managing our Working Capital well is crucial as it helps us release cash for brand building and capital expenditure.

In some of our categories, we have brought our conversion costs in line with best-in-class peers.

We have continued to keep a positive outlook on the future as evidenced by our investment for the long-term.

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