Dear Shareholders,
Heartiest Greetings to all of you!
As India and the world is looking at the brightness beyond the dark clouds that the
pandemic had casted on us, my heart fills up with grief thinking about all the suffering
and ordeal. But it also gives me hope to think of how we all came together to help each
other during this time. As we try to overcome the challenges, we should not forget the
valuable lessons that this pandemic taught us. And continue to imbibe these positive
changes in the future as well.
Even as it seems the worst is over, I urge everyone to still observe caution, follow
government guidelines and get fully vaccinated, take Booster doze (if eligible).
I pray for the well-being and safety of all of you and your loved ones.
Together we have always stood with strength. Your continued support has put more power
in us. I would like to express my gratitude to our employees and channel partners for
their continuous faith and unwavering belief in us even through the difficult times.
Despite of multiple challenges during peak season, the Financial Year 2021-22 has been
a good year. Year started with a strong growth in RAC segment in Qi, but due to second
wave of pandemic pace of growth slowed down. The company continued to grow each quarter
and registered growth of 36% over last year in Residential AC segment. This growth mainly
came from Inverter Split AC segment which was to the tune of 45% over last year. This has
been possible due to turnaround in the socioeconomic scenario in the country - unleashing,
improved lifestyles, changed positive perception of ACs as a necessity, improved
disposable income, more focus on health and well-being, etc.
In commercial AC segment also, the company registered 68% growth in VRF segment
compared to last year. Company saw a huge growth in the light commercial segment with
cassette AC volume grew by 56% and PAC volume by 53% (Tonnage basis) over the last year.
This new world begins with our new-age customers who with their informed outlook
inspire us to aim for something which is better than the best so far. We are encouraged to
develop and deliver not just products that fit their requirement but goes beyond to ensure
their comfort and well-being.
We have always believed in curating consumer centric solutions. We will continue to do
so by further enriched and comprehensive understanding of their needs. The new consumers
of the new world are equipping themselves with useful information to making informed and
smart choices. They are increasingly adopting Inverter technology, smart solutions, smart
features, etc. Their willingness to invest in good and superior technology is a booster
for the company.
We are offering brilliant wide range of superior technology products both in B2C and
B2B segments through a robust network supported by efficient services. We are reaching out
to our customers with effective marketing strategy. With things well in order, we are
constantly working towards preparedness for the future which is being fueled by strong
R&D to facilitate advanced technology for smarter and intelligent products. This is
helping us lay down robust plans and enable sustainable growth.
As a strategy we will continue to aim at increasing our reach across the country with a
focus on Tier 2 & Tier 3 towns, invest our efforts to strengthen our channels, enhance
our service network across the country, work on strengthening of supply chain and
enriching our product portfolio. All these efforts are directed towards building and
sustaining aspirational brand value of Hitachi.
Consumer has been a top priority for us and will always be at the very core of our
design and development. We understand that their needs are evolving - their definition of
NEW is changing, we are and will continuously work towards staying attuned with this. We
endeavor to set new high standards in customer satisfaction delivery with best advanced
technology products and services for their comfort. Our communication message 'New begins
with you' connotes our philosophy of customer first approach and developing Air
conditioning solutions which are inspired from nature and Japanese roots.
The Company continues to cater to diversified segments and achieve excellence. The
commercial air conditioners market is also turning around for us. The Variable Refrigerant
Flow (VRF) technology has been yielding great results and is getting adopted widely across
the Indian market. VRF based Air conditioning systems are rapidly gaining popularity for
use in corporate offices, hotels, IT offices, high-end residential apartments, villas,
retail stores, supermarkets, hospitals, banks, education institutes etc. Johnson
Controls-Hitachi Air Conditioning India Limited, a true customer focused company, has set
pace with the pulse of high-end customers. The company had introduced a new range of VRF
products and country's first of its kind premium and luxurious Air conditioning system
'SET FREE mini' to match modern lifestyle choices. SideSmart™ - World's first slim
modular side throw VRF model air conditioners, launched specially for our new age evolved
consumers is also showing good promise.
Hitachi, being the inventor of world's first 4 way cassette ACs, re-enforced its
position in Air conditioning technology with launch of Silent Iconic™ design panels.
It is perfect blend of technology and award winning aesthetics. The product has been
recognised for its design excellence across the globe and has received international
product design awards including the iF Design Award 2020 in the Product category, the Good
Design Award 2020, and the Red Dot Best of the Best Product Design 2021.
With continuous focused approach the company has established itself as a leading 'Air
Expert' in the B2B space The Company holds a strong market share in the packaged AC
segment with a strong channel network to support.
The commercial market is also recovering with a promising trajectory we are already
witnessing movement in respect to upcoming projects such as hypermarkets, supermarkets,
offices, etc. Which will translate into a good demand for light commercial HVAC solutions.
We are ready and braced to turn this opportunity into sale of our FIVAC packaged units and
Cassette ACs.
As the single largest provider for Air conditioning solutions for Telecom Towers, the
Company is well placed for future growth which would be driven by the coming of newer
technologies such as 5G and loT. Fueled by the need for healthy cellular infrastructure to
match the growing internet requirements, the telecom industry will experience huge growth.
This is an opportunity for the company to generate more revenue.
With India established as a dependable hub, the company is exporting to South Asian
countries - Nepal, Bhutan, Sri Lanka and Maldives; Exports Team is developing network in
new territories and working on channel expansion. Exports business for the company is
expected to contribute towards the business and help in post pandemic recovery.
The company has always been an avid supporter of 'Make in India' and has invested
towards this by working with many component manufacturers in India. We are closely working
with Government, industry associations, and overseas vendors to ensure indigenization of
critical components. We have been encouraging our overseas vendors to consider putting
their factories in India for the critical components to replace imports. Synergizing with
'Atmanirbhar Bharat' Abhiyan we intend to procure everything from India. Be it motors, PCB
boards or compressors. We have participated in Production Linked Incentive (PLI) scheme of
the Government of India in White Goods Category and pledged investments for component
manufacturing.
India is in a phase of healthcare revolution which is creating another avenue for
commercial air conditioning for medical and health care facilities, pharmacies, cold
rooms, warehouses, data centers, etc. We are also feeling positive due to the favorable
government initiatives such as Production Led Incentives (PLI) and Phased Manufacturing
Plan (PMP). These would have a good impact on local manufacturing of critical components
for Indian Air Conditioning Industry.
As we are powering through in business and succeed in touching new heights, we are also
attentive towards our responsibility as a corporate citizen. We realize that effective
initiatives are always required to help those who are in need to make the world a better
place for everyone. And the COVID pandemic has made things more challenging than ever.
Thus, as a responsible and sensitized member of the society the company's CSR team
continuously works towards undertaking impactful implementation of planned projects. Our
CSR initiatives include Primary Health Center at Karannagar that worked for the first rung
medical care of approximately 40,000 rural and partially impoverished population in the
hinterland of Gujarat, women sanitation initiatives in rural areas - constructing toilets
and Sanitary Napkin Unit in rural areas and Skill Development Project for hundreds of
school dropouts including girls. The CSR team has also undertaken initiatives in education
and digital education fields.
I firmly believe that challenges may come and go but they always teach lessons and make
us stronger.
Pandemic has opened ample opportunities for all of us which are led by innovation,
technology advancement, adoption, future planning, future readiness, sustainability but
more importantly the importance of relationships.
As a team, we need to keep progressing on our individual as well as team goals to
achieve organization goals. The Company has maintained a lead by developing advanced
technology and a very sound, dependable, and compassionate network of mindful and sincere
people.
I would again like to express my sincere gratitude to all the stakeholders and the
family of Johnson Controls-Hitachi Air Conditioning India Limited for staying together and
supporting the business. Together we will create excellence with responsibility.
Godspeed.
Gurmeet Singh
Chairman & Managing Director.