Videocon to set up IT park in Kolkata

[Kalyan]

Videocon to set up IT park in Kolkata

Consumer electronics major Videocon group has firmed up its plans to enter into the state IT sector in Kolkata. The Rs 15,000 crore group plans to
set up its own IT facility at the upcoming IT Park at Salt Lake in Kolkata.

Talking to ET, Videocon group chairman Venugopal Dhoot said, "We want to set up our own IT facility at our upcoming Rs 800 crore Salt Lake IT Park. We are still working on it. I can't comment whether it will be a software development centre or an ITeS outfit at this juncture. We are extremely upbeat that this IT Park will generate employment opportunities for quite a large group of people."

The Videocon group chairman, however, brushed aside industry rumours about his company acquiring some IT firm in the US. "We will enter the IT sector on our own. We have no plans to acquire a US-based IT company," he added.

Videocon is setting up a 24-storeyed IT park at Salt Lake, where it has a consumer electronics factory. The total built-up area of the IT Park is 38 million sq ft. The cost of the project has been pegged at Rs 800 crore. Consulting Engineering Services has been appointed consultant for the project.

Shapoorji Pallonji is doing the construction work for the project, which is slated to be completed by end of 2010.
According to company sources work is going ahead as per schedule. Cushman and Wakefield, the global real estate consultant, is helping Videocon to locate IT clients who can be housed in the upcoming Salt Lake IT Park.

Incidentally, the Salt Lake consumer electronics factory, which the company took over from Philips in 1999, currently produces 50,000 colour television (CTV) sets per month. The CTVs are produced under the brandnames - Videocon, Akai and Sansui. The factory also produces refrigerators and washing machines. The total production of refrigerators and washing machines put together is in the region of 15,000 per month.

[dwarakesh]

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%.