Hitachi Energy's Q4 Profit Soars 123.7% to Rs 113.66 cr, Order Book Up 11.5% to Rs 1406.7 crore YoY

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Hitachi Energy's Q4 Profit Soars 123.7% to Rs 113.66 cr, Order Book Up 11.5% to Rs 1406.7 crore YoY

Team FS

22/May/2024

Key Points:

Q4 FY24 profit soars by 123.7% to Rs 113.66 crore, with a 27.1% increase in revenue.
Full-year revenue up by 17%, despite supply chain challenges in the first half.
Strong order book with significant contributions from exports and services.

Hitachi Energy India Limited has reported a remarkable profit increase of 123.7% for the fourth quarter of FY24, reaching Rs 113.66 crore compared to Rs 50.81 crore in the same quarter of the previous year. The company also posted a robust revenue from operations at Rs 1695.28 crore, marking a 27.1% rise from Rs 1334.01 crore in the fourth quarter of FY23. This performance is attributed to solid order execution, a diverse revenue mix, and a focus on continuous operational improvements.

The company's Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) stood at Rs 182 crore, representing a 91.4% year-on-year growth.

Full-Year Performance and Strategic Initiatives

For the full fiscal year ending March 31, 2024, Hitachi Energy India's revenue increased by 17%, totaling Rs 5246.8 crore. The company faced supply limitations in the first two quarters, including delays in procuring semiconductors and other critical electronic components. Despite these challenges, Hitachi Energy deployed strategic initiatives to mitigate the impact of supply chain disruptions, ensuring steady progress.

The company's board has recommended a final dividend of Rs 4.00 per equity share, which is 200% of the face value of Rs 2 each.

Order Book Insights

During the fourth quarter of FY24, Hitachi Energy recorded significant growth in its order book, with orders worth Rs 1406.7 crore, up from Rs 1262 crore in the same quarter the previous year. The company noted stable contributions from exports and services, with industries leading the charge in electrification and digitalization of energy networks across sectors such as steel and silicon. Transmission projects also made substantial contributions, with orders from Engineering, Procurement, and Construction (EPC) companies.

The renewables sector maintained momentum with orders for hydro, wind, and solar plant operations and integration. Service and export orders each increased by 43% year-on-year, underscoring their strong contribution to the overall order book. Service orders included replacement equipment, Annual Maintenance Contracts (AMCs), upgrades, and innovative solutions like RelCare and RelScan for remote condition monitoring and maintenance. Exported products, including transformers and power quality technologies, accounted for around 25% of the order book, with key markets in the Middle East, Southeast Asia, and neighboring South Asian countries.

For the full year, orders rose by approximately 14% year-on-year, reaching Rs 5536.3 crore. As of March 31, 2024, the order backlog stood at Rs 7229.5 crore, providing revenue visibility for upcoming quarters.

Detailed Financial Analysis

The fourth quarter of FY24 has been a standout period for Hitachi Energy India, reflecting a significant turnaround from the previous year's corresponding quarter. The 123.7% increase in profit and the 27.1% rise in revenue are clear indicators of the company's robust growth trajectory. This growth can be attributed to the effective execution of orders and a well-diversified revenue mix. The company's ability to adapt and implement continuous improvements in operations has been pivotal in achieving these results.

The substantial growth in EBITDA by 91.4% year-on-year highlights the company's operational efficiency and cost management strategies. This impressive financial performance is further bolstered by the strategic initiatives undertaken to navigate supply chain challenges in the first half of the fiscal year.

The recommendation of a Rs 4.00 per equity share dividend (200% of face value) reflects the company's strong financial health and commitment to delivering value to its shareholders.

Strategic Initiatives and Future Outlook

Hitachi Energy India's proactive approach in addressing supply chain issues, particularly the delays in semiconductor procurement, has been critical in maintaining its growth momentum. The company's strategic initiatives, including diversifying suppliers and enhancing supply chain resilience, have mitigated the impact of these disruptions.

The robust order book, with significant contributions from exports and services, positions the company well for sustained growth. The increase in service and export orders by 43% year-on-year underscores the strength of Hitachi Energy's comprehensive solutions and global reach.

The diverse range of orders, spanning industries from steel to silicon and including significant renewable energy projects, highlights the company's adaptability and broad market appeal. The continued focus on electrification and digitalization of energy networks positions Hitachi Energy India as a key player in the evolving energy sector.

Looking ahead, the substantial order backlog of Rs 7229.5 crore as of March 31, 2024, provides a strong foundation for future revenue. This backlog ensures revenue visibility and underpins the company's growth prospects for the coming quarters.

In conclusion, Hitachi Energy India's exceptional Q4 performance and strategic initiatives to address supply chain challenges have set a solid foundation for continued growth. The company's robust order book, strong financial performance, and strategic vision position it well to capitalize on emerging opportunities in the energy sector. With a clear focus on innovation and operational excellence, Hitachi Energy India is poised to deliver sustained value to its shareholders and stakeholders.

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Services

Hitachi Energy's Q4 Profit Soars 123.7% to Rs 113.66 cr, Order Book Up 11.5% to Rs 1406.7 crore YoY

Full-Year Performance and Strategic Initiatives

Order Book Insights

Detailed Financial Analysis

Strategic Initiatives and Future Outlook

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