Anant Purandare said the reduction in revenue was due to the decline in the engineering, procurement and construction business.
Bajaj Electricals is looking to get rid of its debt in FY22 and will stay away from power distribution space in the engineering, procurement and construction (EPC) business in this fiscal.
In an interaction with Moneycontrol, Anant Purandare, Chief Financial Officer of Bajaj Electricals said that with the merger of Starlite Lighting into the company, its debt of Rs 230 crore will be added to the balance sheet.
"Our debt has reduced from Rs 962 crore in FY20 to Rs 471 crore in FY21. If you add Starlite Lighting, it comes to roughly Rs 700 crore of debt. But we have that much expected cash inflow to get that, especially from projects in Bihar and Uttar Pradesh," he added.
In its Q4 results, Bajaj Electricals posted a consolidated net profit of Rs 54.26 crore for the March quarter (Q4). The company had posted a loss of Rs 81 lakh in the year-ago period.
For Q4, the company posted a 3.2 percent year-on-year (YoY) decline in income from operations at Rs 1,258 crore.
Purandare said that the reduction in revenue was due to the decline in the EPC business.
"We are not bidding for power distribution projects. This is why our EPC business is being impacted. We will follow this strategy in FY22 as well. The company will only bid for illumination and transmission lines projects. We have also decided that we will not do projects if there are no margins and won’t bid at a lower cost," he added.
Among the segments, the Consumer Products (CP) business saw a 30.6 percent YoY rise in revenue to Rs 975 crore in Q4. He added that appliances and fans saw growth while lighting de-grew marginally.
The EPC segment saw a 48.9 percent YoY decline in revenue to Rs 283 crore in Q4. However, the losses in this segment came down. EPC recorded a loss of Rs 8 crore as against loss of Rs 23 crore in the year-ago period.
The operating margins for the CP business stood at 8.7 percent in Q4 as against 12.3 percent in Q3.
"The margins were better in Q3 because it was festive season and also because it was the season for water heaters sales, a product that gives better margins. The operating leverage also gave us better margins in Q3," he added.
While commodity prices continue to stay volatile, Purandare said that when the lockdown is lifted, the cost increase will be passed on to customers depending on the demand.