A Superhit Among Investors: How Hitachi Yielded 8,627% Returns

Published by Trinkerr Academy on

If you had invested ₹1 lakh in Hitachi 20 years ago, then you could have had ₹86 lakhs today! This multibagger gave immense returns of 8,627% and a smashing dividend of ₹84,210. Take a closer look at the company.

❄️ Stock: Johnson Controls-Hitachi Air Conditioning India Ltd.

🏔️ The Roots
The primary business of Johnson Controls-Hitachi Air Conditioning India Ltd. is the production, marketing and trade of air conditioners, refrigerators, chillers and VRS systems. It is one of the biggest producers of commercial air conditioning in the world. It is a joint venture between Johnson Controls and Hitachi Appliances Inc. that was established in 2015. Hitachi Global Life Solutions’ carved-out air conditioning division is 60% owned by Johnson Controls while Hitachi still holds 40%.

☃️ Revenue Breakup and Market Position
The company’s product line includes a range of room air conditioners, VRF systems, package air conditioners, chillers, refrigerators and aqua-guards. The company currently controls 12% of the Indian market for room air conditioners. It continues to be the leading supplier of AC solutions for cooling requirements in the telecom tower market.

The total revenue of FY22 is divided into:
◾ 74% – Manufacturing Sales
◾ 17% – Trade in Products
◾ 8% – Services
◾ 1% – Others

🌐 Distribution Network and Export Presence
290+ exclusive sales and service dealers, 70+ Hitachi exclusive showrooms, 10,000+ sales points and 1,500+ additional service locations, including multi-brand S&S and authorised service partners, make up the company’s broad distribution network.

The firm recently began exporting goods to a number of South and South-East Asian nations, including Nepal, Bhutan, Sri Lanka, the Maldives, Indonesia and Vietnam. Additionally, it exports its goods to Middle Eastern nations, including Saudi Arabia, UAE, Qatar, Oman, Bahrain, Iraq and Kuwait. Product exports made up about 4% of sales in FY21 as opposed to 3% in FY20.

🏭 Manufacturing Facility
In Mehsana, Gujarat, the business owns and runs its own manufacturing facility. Here is the annual breakup of its manufacturing capacity:
◾ 300 chiller units
◾ 9,000 VRFs
◾ 120,000 tonnes of ductable units
◾ 900,000 room air conditioners

🌨️ Development Services
In order to create and assist in the development and enhancement of features in both new and old goods, the firm also engages in providing design and development services to group companies. Design and development services made up about 4% of sales in FY21 as opposed to 3% in FY20.

On August 9, 2002, the shares of the company were trading at ₹17.44, while they were priced at ₹1,522.1 as of August 10, 2022.


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