Mumbai: Consumer durables maker Whirlpool of India Ltd plans to invest about Rs300 crore to spur growth over the next three years, a senior official said on Friday.
“The primary areas of expenditure with this investment will be launching new products, renewal of old products and advertising and promotion across India,” Shantanu Dasgupta, vice-president, corporate affairs and strategy, told Reuters.
Whirlpool is also planning to raise prices across product categories by 2% going forward due to rise in input costs.
“If you look at the monitors of commodity price increases then oil, steel, copper all have been steadily creeping up ... going forward 2% or so is what we are actually looking at,” he said.
The company, which makes refrigerators, air-conditioners and washing machines, is present across price points and plans to further strengthen its presence in the large Indian rural market with cheaper products.
Sixty per cent of the firm’s revenue comes from the urban market while rural sales make up the rest.
“We are planning to strengthen our rural foray and enter new geographies with refrigerators as it is a very mature category,” Dasgupta said.
The consumer durables maker is also planning to increase its advertising expenditure this year following a revival in demand.
“We are beginning to see growth coming back and are concentrating a lot on brand visibility and advertising. This year we are going to spend 10-15% more than last year,” he said.
Whirlpool spent Rs540 million on advertising and promotion in FY09.
The company, which posted a net profit of Rs249.3 million in the quarter ended September from Rs17.4 million a year earlier, expects to maintain a double-digit growth rate for the rest of the fiscal.
“We are very confident about domestic demand and exports have come back to growth. Our sector is what is driving the manufacturing sector and we are certainly hoping to maintain a 30% growth rate, which we witnessed in the last quarter,” he said.
“And even if we are not able to do that we are hoping to clock in a double-digit growth rate going forward.”
The firm’s sales rose to Rs471 crore in July-Sept from Rs351 crore in the same period last year. Whirlpool, a debt-free company, is sitting on cash worth Rs100 crore, Dasgupta said.
Shares of the company ended steady at Rs119 in a firm Mumbai market.