Consumer electronics firm Videocon Industries Ltd will diversify into selling power inverters and mobile phones, boost research and development (R&D), and streamline operations, seeking a larger global footprint in the next three years, a top official said.
“In India, electricity is a big problem. So, we want to get into the power inverter market by early next year,” vice-chairman and chief executive officer K.R. Kim said in an interview. Power inverters are devices that store electricity locally in batteries, which can then be used during power outages.
“Another category we are looking at is mobile phones,” Kim said, adding that the company would outsource the production of inverters and cellphones. “In the case of mobile phones, we could (even) import from China or high-end phones from Korea.”
The $4 billion (Rs19,480 crore) Videocon group also has interests in oil and gas, retail and colour picture tubes.
The company intends to add some 200 people in three years to the 50 working at its R&D unit at Aurangabad, Maharashtra.
In 2009, it will invest Rs150 crore on R&D, marketing, product launches and manufacturing. Videocon, which currently exports 10% of its production to West Asia and Africa, would also look at new markets such as Latin America. “In the next three years, 20% of the products will be exported.”
Kim also plans to focus on consolidation and streamlining, and has already reduced the number of branch offices from 200 to 48 in five months. “We are trying to expedite decision-making by cutting down the number of steps involved,” he said.
Videocon has factories in Aurangabad, Bharuch (Gujarat), Kashipur (Uttarakhand), Kolkata (West Bengal), Shahjahanpur (Uttar Pradesh) and Bangalore (Karnataka). It currently outsources 20% of its production to third-party manufacturers.
The company is looking at better utilizing the capacities at its units and increase outsourcing. “By next year, we may outsource 30% of total production,” Kim said.
The company is aiming at an annual growth of 20%.