Interview with HSIL Ltd
By becoming a focused packaging company, we are looking at accelerated growth, further improving our operational efficiencies, states Sandeep Sikka, Group CFO, Somany Impresa Group (HSIL Ltd).
Can you shed some colour on the divestment and restructuring activities undertaken by HSIL over 9MFY22?
The Board of Directors approved the slump sale of assets & liabilities of the BPD division of HSIL to Brilloca Limited, a wholly-owned subsidiary of Somany Home Innovation Limited (SHIL),for a cash consideration of Rs 630 crore (subject to closing date adjustment). Sales proceeds will be utilized towards pre-payment of existing bank borrowings and will enable headroom for accelerated growth.
This transaction has been carried out with the objective that HSIL shall completely focus on the growth of its packaging business and capitalize on both organic and inorganic opportunities.After the sale of the BPD building division, HSIL will emerge as a focused packaging company, well-positioned to implement its strategic plans to drive the packaging business and continue to unlock value for all stakeholders.
What are some of the biggest challenges you are currently facing?
The rising input cost owing to a substantial increase in raw material prices such as ash and fuel prices. The total fuel and power cost for glass containers manufacturing has increased by 48% per MT on Y-o-Y for the quarter which has put pressure on margins, but we are expecting retrieval of margins due to strong operational efficiencies in the manufacturing process and plan to pass on increased costs to the customers.
At the moment, what are your top 3 strategic priorities?
By becoming a focused packaging company,we are looking at accelerated growth, further improving our operational efficiencies and our foray into the high-value products segment. We will soon operationalize our speciality glass manufacturing unit at Bhongir, Telangana, capable of producing 154 tons of glass per day.
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