The joint managing director of Havells Sylvania, Anil Rai Gupta, has said that it is 'highly probable' that the company will list its Sylvania Global brand on the London Stock Exchange in 12 to 18 months.
Speaking exclusively to Lighting at Light + Building 2014, Gupta gave credibility to the rumours that emerged after Sylvania president Rajiv Goel conducted an interview with Economic Times in March. Gupta said: "When we acquired Sylvania we had it in mind that at some stage we'd list it because we believe that it could be a larger company and could have a very good track of growth. However, after the acquisition, the global crisis came and we had to restructure the company and make sure it remained profitable.
"It's now profitable, it's back on track and we have a good share between mature and emerging markets and we have a very good blend between fixtures and lamps and a strong track record of converting our lighting into LEDs. Having all the ingredients we now believe that it's the right time to revisit the idea of listing it separately and letting it find its own growth."
Gupta said that a further 12 to 18 months of consolidation would be required for the company before any listing took place: "We believe we've put in some efforts to improve the margins and we've worked on the product mix and that will show in the next 12 months or so, and post that, in the next 12 to 18 months we think that would be a good time for our listing. I think it's highly probable".
He suggested the company did not need the additional capital from a flotation to service its debt but that the revenues would be used to fund acquisitions in South America and parts of Europe. ??
"What we need are 'bolt-on' acquisitions that would give us access to new markets, or to access some product categories in which we are not strong in certain markets," Gupta said. ?"For example, in high growth markets like Mexico we are very strong in fixtures and there we feel acquiring some lamp businesses would be helpful. In Columbia, we are strong in lamps but an acquisition of a fixtures company could help to enhance the product range. In Europe we have 50 per cent lamps and 50 per cent fixtures overall, but would look to make acquisitions in countries like Spain and Italy where the mix is closer to 80 per cent lamps and 20 per cent fixtures".
Havells listed on the Indian Stock Exchange in 1993 and has shown good returns to shareholders in the last 20 years. The company's CAGR value growth for shareholders in the last 10 years has been over 40 percent.
