Voltas, the air conditioning and engineering services provider of Tata Group, exceeded industry growth in the quarter ended June 30, 2014. The extended summer season this year helped Voltas notch a higher 29% growth in sales against the air conditioning industry growth rate of 22%, senior company executives said citing GfK-Nielsen data.
This apart, unitary cooling products (Segment C) revenues crossed Rs 1,000 crore mark for the first time as against Rs 787 crore in the corresponding quarter last year. Segment C now contributed around 57% to the total revenues of Rs 1,752 crore in first quarter of fiscal 2015, followed by Segment A (electromechanical projects and services) at 36% and Segment B (engineering products and services) at 6%.
"The company has seen a substantial increase in sales volume helped by several strategic marketing and communication initiatives enhancing brand recall. The commercial refrigeration business too performed well. Segment result was also significantly higher at Rs 116 crore as compared with Rs 68 crore a year ago, due to improving margin realisation and better product mix (including growth in share of split air conditioners)," Utsav Shah, spokesperson, Voltas, said in an earnings conference call on Thursday.
Accordingly, despite severe competition, the company has maintained its market leadership position in the room air conditioners products (Segment C) business. Citing GfK-Nielsen Retail Audit findings, Shah said its June market share was at 21.7%, a substantial lead over the nearest competitor.
On status of Sidra Medical and Research Centre Hospital, Qatar, contract, Voltas officials said the project is over 95% completed. However, subsequent to close of the quarter, the main contractor (OHL) has been terminated by the end-customer (Qatar Foundation) and a new main contractor has been appointed.
"As uncertainties in the completion schedule, assignment of the sub-contracts and approval of variations/claims continues, the company's current estimates of cost and entitlements could get modified. Adequate provision exists currently and no additional provisions were made during the reporting quarter," Anil George, president corporate affairs and CFO, said.