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India a ‘great opportunity’ in renewables for Schneider Electric: Global CFO

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India a ‘great opportunity’ in renewables for Schneider Electric: Global CFO

May 20
09:12 2023

Hilary Maxson, Global Chief Financial Officer and Executive Vice President, Schneider Electric France-headquartered energy management major Schneider Electric sees India as a “great opportunity” in renewables and digitisation, said its global Chief Financial Officer and Executive Vice President Hilary Maxson, in an exclusive interaction with ETCFO. The finance leader also expects Schneider’s decent share of global investments in India over the next two decades.

“We see a great opportunity for India to leap forward in renewables and digitisation. The country is an important hub for Schneider not only from its sales standpoint here but also from the global sales standpoint…In terms of investments, a decent portion of our global R&D investments are carried out here and we would like to see more of it in the future. Also, we have a large production footprint here, and we see that footprint further growing with a number of new plants expected to come this year and over the next couple of years,” Maxson told ETCFO.

Investments

Schneider Electric plans to invest Rs 1,400 crore in India over the next two years to increase its manufacturing footprint in the country by building five new factories, its Chairman Jean-Pascal Tricoire shared in February during his India visit. The global CFO echoed the investment optimism. “Right now, India is our third largest market right behind China and US. It became the third largest after our last acquisition (Schneider bought L&T’s electrical and automation assets for Rs 14,000 crore in August 2020). We are a large global player so that gives a sense of importance to India in terms of sales…Going forward, assuming other markets do okay, we anticipate that India should probably continue to be between two and three spots. We see no problems growing in India…” Maxson said. China and the US both constitute a 15%- plus share of the total sales for Schneider.

Business drivers

The global executive said her confidence in India stems from the firm’s already established diversified presence in the country as well as the government’s policies and the businesses’ increasing focus on energy transition.Schneider has 36,500 employees in India, which is about 27% of the company’s overall 135,000-plus headcount. It has 6,000 dedicated R&D engineers in the country and 30 manufacturing sites.“The government’s agenda is well-focused on energy transition. And also beyond this, the opportunities that the companies see are focused on energy transition.. that’s the core of what we do, with electrification, automation, and digitisation across various sectors, so we think the right elements are at play for us,” the CFO said. “Also, the other thing is the country itself is digitising, and that agenda that the government has, for instance, one saw the digitization of tax with GST (regulation), that to our mind are strong predictors that the economy is going forward,” Maxson added.

The global CFO stressed that Schneider’s priorities would be both volumes and profitability. “There is a growing debate today in companies whether they should go for volumes or whether they should go for profits. But for us at the end of the day, we want both, so both are priorities for us,” she said. Schneider is profitable across all regions including India.India is a part of the Asia-Pacific region for Schneider; the company’s other regions are North America, Western Europe, and the Rest of the World. The Asia Pacific region for the firm constituted 30% of total revenue and 35% of total employees in 2022. India’s sales contributed “strongly” to the 2022 growth numbers, Schneider Electric, which is listed on the Paris Stock Exchange, indicated in its 2022 annual report; (Schneider’s reporting year runs from January to December).Schneider Electic, which is present in over 100 countries, including India, posted consolidated revenue at euro 34,176 million in 2022, up +12.2% organic and up +18.2% on a reported basis. Schneider’s energy management business generated revenues of euro 26,442 million, equivalent to 77% of the Group’s revenues, and was up +12.9% organically. Its industrial automation business generated revenues of euro 7,734 million, equivalent to 23% of the Group’s revenues, and was up +9.5% organically. The global CFO refrained from sharing region-specific numbers.

About Schneider Electric

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