New Delhi: Electrical goods maker Havells India said it has formed an equal joint venture with China’s Shanghai Yaming Lighting Co to set up a lighting products plant in China that it expects to generate revenue of $100 million in three years.
The joint venture, called Jiangsu Havells Sylvania Lighting Co, will initially invest $50 million, with the possibility of raising this to $100 million over three to four years, Havells joint managing director Anil Gupta told reporters on Monday.
A file photo of Havells India joint managing director Anil Gupta.
The plant is slated to begin production by April, he said.
The venture will produce energy-efficient and green lighting products for the Chinese and international markets.
“Manufacturing in China is commercially more viable,” Gupta said in explaining the reason for setting up the joint venture.
Shanghai Yaming Lighting Co, a unit of Shanghai Feilo Acoustics, makes various types of lamps and lighting products in China, Japan, Belgium and the United States.
Havells, which gets half its revenue from Germany’s SLI Sylvania, which it acquired in 2007, said in July that it was looking for a joint venture partner in China to boost sales and set up a manufacturing facility.
Havells already exports products to China, generating $5-6 million of revenue per year. The company has 12 plants in India and six overseas.
The initial investment will be funded internally, although the joint venture may consider a debt issue in China later as it scales up production, Gupta said.
Havells shares, valued at about $900 million, were up 2.73% at Rs395.65 by 01.18 pm in a firm Mumbai market.