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Demand is holding up in rural towns but rise in commodity prices a concern: Havells India

Updated : December 29, 2020 05:34:04 IST

Havells has recovered from the lows and is up almost 80 percent from the March lows. Anil Rai Gupta, CMD of Havells India said that the demand is holding up from B and C grade towns. There is also a shift from unorganised to organised players, he said.

Gupta also said that there is an improvement in the residential sector and there is some revival in the industrial and infra portfolio. However, he expects the rising commodity prices to be a dampener.

“It has to be passed on because the increase has been sharp. But it does dampen two things. One, there will be pressure on margins and secondly, if this sustains, people will have the option to postpone their purchases even in the construction sector. So there will be little bit of stress if this continues,” he said.

Gupta believes that government move to boost manufacturing is a step in the right direction. “The government has realized that the next big source of job creation will be manufacturing and I think the government is taking the right steps. They have chosen many industries for production-linked incentive (PLI) and we are looking at increasing investments in both lighting and air conditioning with the new PLI,” he said.

On capex, he said, “We have invested constantly, at least Rs 300-500 crore in capex every year. Going forward we anticipate a similar capex would continue; maybe a bit more so – maintenance capex and the other divisions and high capex in the air conditioning and the lightings space. But we definitely see that going forward we will be looking at continued capex even in the coming times.”

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