Hitachi ABB Power Grids in India: Top-line stability in a challenging environment

• Industrial and rail business drives sequential order growth

• Revenue up 26.2% YoY 

• PAT up 34.9% YoY

• Operational EBITA up 34.1% YoY  

• Solid cash collection enables debt-free close of the quarter;  
  CRISIL AAA/Stable rating 

*Demerger cost and realization of old receivables previously provided for

**The company evaluates the profitability based on Operational EBITA. Operational EBITA represents income from operations excluding: (i) amortization expense on intangibles, (ii) restructuring and restructuring-related expenses, (iii) non-operational pension cost, (iv) gains and losses from sale of businesses, acquisition-related expenses and certain non-operational items, as well as (v) foreign exchange/commodity timing differences in income from operations consisting of: (a) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (b) unrealized foreign exchange movements on receivables/payables (and related assets/liabilities).

“Even as challenging times persist, we are pleased to report a stable topline performance. Key order wins in renewables, railways, datacenters and digitalization complemented traditional projects in domestic and export markets,” said N Venu, CEO and Managing Director, Hitachi ABB Power Grids in India.

“Investment in areas like transmission, rail, metros and renewables are expected to bring continued opportunities and enable us to strengthen our leading market position. Our primary focus continues to remain on protecting our people – employees, partners and communities, to together navigate this maelstrom of the COVID-19 pandemic,” he added.

Orders

Our order book of INR 848.9 crore was driven by industries and railways. We received multiple orders for our gas-insulated high-voltage switchgear – indicative of imminent urbanization and industrialization. These orders came from data centers, a solar project in Tamil Nadu, an aluminum smelting plant in Chhattisgarh and a transmission project in Uttar Pradesh. We were also the preferred partner for supplying transformers to the Indian Railways, for hydroelectric power generation in Jammu and Kashmir and for the Bangalore metro rail. 

In addition, we were chosen for a cybersecurity audit by a large city distribution company in one of the metros. We also achieved the IEC 62443 certification in the first quarter, reaffirming our commitment to deliver products and systems that meet the highest cybersecurity standards. In continued efforts to deliver cutting-edge technologies, we conducted power system studies and virtual instructor-led training for top power generation and transmission companies.

Exports demand for our products, systems and services came from Africa, Southeast Asia, Latin America, the United Kingdom, and many other regions.

As of 31 March 2021, order backlog was INR 4,777.7 crore.

Revenue and Operations

In the first three months of 2021, revenue increased 26.2 percent YoY reaching INR 1,023.8 crore. Extensive use of remote management and digital solutions, coupled with a diverse product mix, ensured a resilient topline performance in a challenging market.

Strengthening our digital service capabilities, we set up a state-of-the-art remote monitoring and reliability service center – PowerREC – in Bangalore in the first quarter. The center will offer our customers an advanced maintenance platform to improve the overall reliability and uptime of their power assets.

Besides this, we partnered with Sikshana Foundation to launch the Women-in-Engineering program that facilitates education for girls aspiring for a career in engineering.

Profit

Operational EBITA in the January-March quarter was INR 75.9 crore, up 34.1 percent YoY. Profit before tax was INR 53.7 crore driven by an unwavering focus on operational excellence and strategic cost-out measures that strengthened our cash position. Our profit after tax at INR 39.4 crore at the close of the quarter was up 34.9 percent YoY.

We were debt-free as on 31 March 2021 and maintained our AAA/Stable rating from Indian rating agency CRISIL. Short-term facilities remained A1+. Both highest ratings accorded to Indian corporates.