CIOReviewIndia Team | Friday, 21 August 2020, 05:14 IST
Taking charge of as the Managing Director and Chief Executive of Thermax from MS Unnikrishnan from 1st September, the appointment of Ashish Bhandari, who joined the company as the managing director, is announced at a time during which the world is fighting against the COVID-19 pandemic and the company is not yet immune to it.
Thermax’s performance data of the first quarter of June suggest that the company’s performance was highly influenced by the pandemic where the revenue dropped 52 percent year-on-year to Rs. 660 crore. The order inflows of the company also decreased 50 percent year-on-year, resulting to a sloth growth in the industrial activity and the prevailing uncertainty. There are some positive reports in the sectors of pharmaceutics and FMCG, yet the total ordering environment is predicted to stay trembling in the financial year 2020-2021.
The analysts suggest a weak ordering environment coupled with order book depletion defines a significant risk to revenue, estimated for the next two financial years for Thermax. The order book for Thermax dropped 1 percent year-on-year to Rs. 5210 crore during the quarter. The decline in order book and growing it sustainably will be a key challenge for Bhandari.
Though the situation is blurred for the capital goods sector as a result of significant fall in consumption, some of the industries that directly connect to the customers like pharmaceuticals, food and beverage, and chemicals is showing a stable and increasing growth for Thermax. It is expected that Bhandari will generate further growth with the help of these sectors for Thermax, jailing opportunities in the new-age sectors, where the company’s top leaders find opportunities to.
The Chairperson of Thermax, Meher Pudumjee, said, “Thermax finds opportunities in renewable energy and sectors that improve energy efficiency. In line with government regulations (segments) such as waste heat recovery, solar PV, Flue Gas Desulphurisation Systems (FGD) could witness traction. The new large capital projects may likely get deferred, opportunity for operations & maintenance (O&M) services, as well as replacement demand, is likely to witness an uptick. While there might be some demand creation for capital goods with the government’s impetus on ‘Aatmanirbhar’, new projects will take time to develop.”
According to the analysts, the metals and cement division of Thermax will witness a massive growth. The overall growth for Thermax was previously dominated by the domestic market and there is a visible international presence for the company, which exposes it to the risk of rising commodity prices, given fixed-price contracts. Bhandari is expected to balance these risk and generate growth in the international business of the company.
Pudumjee said, “Bhandari brings with him nearly three decades of global experience with a strong track record of growing diverse businesses. I have found him to be an extremely thoughtful, clear thinking, and level-headed leader with a strong sense of values that will integrate him well into Thermax. The Thermax of the future is one that is closely aligned with the needs of a cleaner, greener, healthier world. We look forward to Ashish bringing in a fresh perspective and moving the organisation to a greener, more sustainable international portfolio with smart products, projects and services.”
From Baker Hughes (previously known as GE Compay), Bhandari joined Thermax as the Vice-President for India and South Asia region. He completed engineering from the Indian Institute of Technology, Mumbai and earned master’s degree in business administration from Duke University.
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