Dilip Piramal said that VIP Industries result disappointed due to Covid pandemic. Q1 FY21 sales were down 94% when compared to Q1 FY21, Q2 FY21 sales were much better when compared to Q1 FY21 as sales improved from 6% in Q1 FY21 to 25% in Q2 FY21 and further improved to 55% in Q3 FY21. Q4 FY21 is expected to be better than Q3 FY21.

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However, Q1 FY22 is expected to be strong historically and Dilip Piramal said he expects sales in Q1 FY22 to be robust as travel business is at its peak due to the holiday season during this quarter. Marriage season will also give some boost to sales of VIP Industries.

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Piramal said the business is not as usual and has not reached pre-Covid levels as international travel business is shut and also due domestic travel concerns. He said this week there were some concerns highlighted by Maharashtra state Government due to increasing Covid cases.

Piramal said that sales are improving and it is expected that it would reach normalcy by end of Q4 FY22. Margins will take some time to return to normalcy when compared to previous year. The margins will improve going forward as purchasing from China has almost Zeroed.

Piramal said that the supply that company gets from their factories in Bangladesh yields good margins to VIP Industries as they are completely owned by them. They will make similar profits like China. He said that VIP Industries is extremely strong structurally and is excited about the future from here on.

Piramal said that it is difficult to expect changes in income tax rate every year. Ideal tax rate will remain ideal even in the next Budget announcement. Personal tax rates in many European Countries are even higher than that in India. Corporate tax rate at 25% is extremely good and even GST Rates are good.

Piramal said that the decision made by the Government for Infrastructure sector will benefit the economy which in turn will benefit VIP Industries. Since VIP Industries is from discretionary space, Piramal said if the economy improves by 8%, VIP Industries will grow by 15% to 20%. Non essential items sales doubles to the pace the economy is growing.

Piramal said Market Segmentation is an important concept to understand in Marketing. For example, In the Auto Sector there are 10 different types for Vehicles to cater the demand of different customers. Similarly, VIP Industries have different brands to cater different customers. Carlton, VIP, Skybags, Aristocrat and Alfa are different brands which cater different segments in the market.