03 Sep, 2021

Philips India Annual Report 2021 Update

03 Sep, 2021,

225 0

Philips India is a leader in the business of Health System, Personal Health and Innovation Services. Below is the business performance of Philips India for the year FY202-21. Health System

a) During the year 2020-21, Health Systems business of Philips India delivered another year of strong performance irrespective of Market de-growth, driven by growth in Image Guided Therapy (IGT) (47.6% Market Share) and Connected Care (CC) Business. b) In Image Guided Therapy(IGT),Philips Market share improved by 11.2%. c) Magnetic Resonance (MR), Philips Market share increased by 1.5% fuelled by PMRS. d) Ultrasound business of Philips India has improved market share from 17% to 19.7% driven by strong performance of the India. Personal Health

a) Personal Health business continued its transformation journey by adopting to the external dynamic headwinds and delivered 16% growth over the previous financial year. b) Under Domestic Appliances business, Philips India has launched New Urban living range of Air Purifiers with an idea to create a safe in home environment and also a new range of Oven Toast and Grill (OTG) products to support the In-home Cooking trend. Demerger of Domestic business

Domestic Appliance Business will stand transferred to and vested with Philips Domestic Appliances India Limited with effect from the appointed date i.e. July 1, 2021. So existing shareholders of the Philips India will get shares of Domestic Appliances. And, accordingly the unlisted shares value of Philips India will reduce.

Domestic Appliances business including the Company’s subsidiary “Preethi Kitchen Appliances Private Limited” will be carved out from the Business segment “Personal Health” which primarily involves sale of kitchen appliances (juicers, blenders, Air fryer, food processors), home care (vacuum cleaners, air purifiers), garment care (irons, steam generators) and coffee makers (appliances and accessories).

Financial Performance of Domestic Business

Particulars (in Cr)	FY20-21
Revenue from operations	1475
Operating expenses	1373
PBT	101
PAT	80

In accordance with the Scheme, the assets and liabilities pertaining to Domestic Appliance business will stand transferred to and vested with Philips Domestic Appliances India Limited with effect from the appointed date i.e. 01 July 2021 and shareholders of the Company will be allotted 1 fully paid equity share of Philips Domestic Appliances India Limited for each fully paid equity share held by them in the Company on or before the Effective date and the transfer of the De-merged Undertaking shall be on a going concern basis. Innovation Campus

Philips Innovation Campus, Bengaluru (PIC-B) established in 1996 as a premier software research and development organisation of Royal Philips, today hosts 4500+ top-notch professionals working on developing products and innovative solutions across the healthcare continuum to improve people’s health. It is one of the four major Philips innovation hubs globally. Subsidiaries of Philips India

During the financial year 2020-21, Philips India had three wholly owned subsidiaries, Preethi Kitchen Appliances Private Limited (“Preethi”), Philips Home Care Services India Private Limited (“Philips Home Care”) and Philips Domestic Appliances India Limited (“Philips Domestic Appliances”). Now as said above, the Domestic Appliance India business was de-merged from Philips India w.e.f o1.07.2021. Financial Performance of Philips India

Particulars (in Cr)	FY20-21	FY19-20
Revenue	5639	5253
EBITDA	512	447
OPM	9.08%	8.51%
Profit from continuous operation	164	143
Profit from discontinuous operation	101	0
EPS	43	25

If you see the above financial carefully, company has shown two types of profit in the books, first from continuous i.e. 164 Crores and Second is discontinuous i.e. 101 Crores. This discontinuous profit will not be available from next year as this business is de-merged. Current Unlisted market price of Philips India is 1600 and P/E 37x based on EPS of 43. After demerger of the domestic appliances business EPS would become 28. So, price of Philips India should trade around level of Rs.1000 if we give P/E of 35x to its business after de-merger. For 30x P/E, the price would be ~800 per share.

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