Ashish Bhandari to take over from MS Unnikrishnan as Thermax head

Ashish Bhandari will be taking over the charge from MS Unnikrishnan as the managing director and CEO at Thermax from September 1. He has joined the company as joint managing director. The appointment of Bhandari comes at a time when the world is grappling with the Covid-19 pandemic.

In the recently ended June quarter, Thermax’s performance was severely impacted by the Covid-19 pandemic with revenue falling a sharp 52% year-on-year to Rs 660 crore. Order inflows also plunged 50% y-o-y to Rs 610 crore owing to the slowdown in industrial activity and the prevailing uncertainty. Though there are some green shoots in sectors like pharmaceuticals and FMCG, the overall ordering environment is expected to remain weak during the financial year 2020-2021.

According to analysts, weak ordering environment coupled with order book depletion is a significant risk to revenue estimates for the coming two financial years for Thermax. The company’s order book declined 1% y-o-y to Rs 5,210 crore during the quarter. Arresting the decline in order book and growing it sustainably will be a key challenge for Bhandari.

While the outlook remains hazy for the capital goods sector due to significant drop in consumption, some of the customer-facing industries like pharmaceuticals, food and beverages, and chemicals have been showing good growth for Thermax. Bhandari will be expected to drive further growth through these sectors in the company’s portfolio, and look for opportunities in some of the new-age sectors which the company’s top leadership finds potential in.

Meher Pudumjee, chairperson, Thermax, told FE that the company sees opportunities in renewable energy and sectors that improve energy efficiency. “In line with government regulations (segments) such as waste heat recovery, solar PV, Flue Gas Desulphurisation Systems (FGD) could witness traction,” she said in an e-mail response. She also said that new large capital projects may likely get deferred, opportunity for operations & maintenance (O&M) services as well as replacement demand is likely to witness an uptick. While there might be some demand creation for capital goods with the government’s impetus on ‘Aatmanirbhar’, new projects will take time to develop, she added.

While there is some revival in private capex in few segments like metals, and cement, a broad-based recovery is key for Thermax, according to analysts. While traditionally, Thermax’s growth was led by the domestic market, there is a significant international presence as well, which exposes the company to the risk of rising commodity prices, given the fixed price contracts. Bhandari will now be expected to balance these risks and drive growth in the company’s international business.

According to Pudumjee, Bhandari brings with him nearly three decades of global experience with a strong track record of growing diverse businesses. “I have found him to be an extremely thoughtful, clear thinking, and level-headed leader with a strong sense of values that will integrate him well into Thermax. The Thermax of the future is one that is closely aligned with the needs of a cleaner, greener, healthier world. We look forward to Ashish bringing in a fresh perspective and moving the organisation to a greener, more sustainable international portfolio with smart products, projects and services,” she said.

Bhandari joined Thermax from Baker Hughes (formerly a GE Company), where he was the vice-president for India & South Asia region. He is an engineering graduate from the Indian Institute of Technology, Mumbai, and received his master’s degree in business administration from Duke University.