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Rising Beyond Challenges

Rakesh Khanna’s knack for turning businesses around and building sustainable high profitability business models has worked wonders for Orient Electric

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Reputed as a sharp business strategist with hands-on approach and eye for detail, Rakesh Khanna has been instrumental in the growth of Orient Electric since joining as its CEO in 2015. Khanna is a versatile professional with strong financial acumen and deep insight of Indian and the UAE markets, having managed brand leaders like Sony, Jumbo, Hitachi, Wipro and Eureka Forbes in his earlier stints.  

A mechanical engineering graduate of the Thapar Institute and a postgraduate in management studies from the University of Mumbai, Khanna has a consistent track record of achieving business turnaround and building sustainable high profitability business models.  

What does Orient Electric (OEL) do? With operations spread across more than 35 countries, Orient Electric, a part of the $2.4-billion diversified CK Birla Group, has earned the trust of millions of customers by providing cutting-edge lifestyle electrical products. OEL has fully integrated manufacturing facilities in Kolkata, Faridabad and Noida. In the domestic market, it has a well-organised distribution network made up of 1,25,000 retail outlets as well as a strong service network covering more than 450 cities.  

OEL is the largest manufacturer and exporter of fans in India with presence in over 40 international markets. It is also the second largest manufacturer of LED bulbs in India and the first Indian lighting brand to have been awarded BEE star rating for LED bulbs, the company claims. 

Steady Growth 

"At Orient Electric, we have long believed that in times of unpredictable upheaval, adaptive and agile companies prevail,” said Khanna while addressing the shareholders in FY21. Terming the Covid-impacted fiscal as a "challenging year of uncertainty", Khanna said it was heartening to report that OEL posted a 24 per cent growth in operating EBITDA and a 52 per cent growth in profit after tax in FY 2020-21. "All business segments registered significant growth across the topline and bottom-line in the last three quarters of FY 2020-21," he added.  

For FY22, the company delivered an overall resilient performance and posted an aggregate revenue growth of 21 per cent year-on-year, under challenging demand and operational conditions, Khanna said during an investors call. "As lockdowns receded and vaccinations permuted, people's lives started to return to normal gradually. As a result, customer sentiments improved and we experienced encouraging revival for the demand for electrical durables," he added.  

The revenue from OEL's electrical consumer durables segment grew an impressive 19 per cent year-on-year for the full financial year 2021-22. The lighting and switchgear business also grew 15 per cent year-on-year. FY22 further witnessed beginning of OEL’s footprint expansion into southern and eastern parts of India. 

For the fiscal year ended March 31, 2022, consolidated net profit of OEL was up 5.76 per cent at Rs 126.64 crore. Revenue from operation stood at Rs 2,448.37 crore in 2021-22, which was higher than Rs 2,032.60 crore in the previous year. ''FY22 has been a year of consumer demand revival. Revenue growth of 20.5 per cent YoY is testimony to Orient’s continuous response to macro headwinds,'' it said. 

Going forward, OEL is prioritising establishing a state-of-the-art greenfield manufacturing facility in Hyderabad. The Company has commenced the design phase, with construction planned to start in FY2023.,” Khanna said. 

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Magazine 23 August 2022