BackMirc Electronics plans to start manufacturing refrigerators
Mirc Electronics plans to start manufacturing refrigerators
PremiumNew categories: Mirc Electronics chief executive officer G. Sundar
New Delhi: After launching mobile handsets last year, Mumbai-based Mirc Electronics Ltd, the company that markets consumer electronic products under the Onida brand, is looking at entering new product categories besides consolidating its position in those that it is already present in.
Sundar added that this year the company’s focus will be to consolidate its market share in all categories it is present in. The company has a market share of 12-13% in television and split air conditioner segments. In the rest of the categories, its market share is less than 10%. “...the target is to achieve at least 10% market share in categories we are present in at the moment," said Sundar.
According to industry experts, the company’s entry into mobile phones segment has helped it increase its revenue and manufacturing refrigerators would complete its portfolio of products.
“About five million units of refrigerators are sold in India every year... These account for about 12% of the total consumer electronics and appliances market estimated at Rs30,000 crore," said Suresh Khanna, secretary general, Consumer Electronic Appliances Manufacturers Association.
The company, however, will have to face stiff competition in the refrigerators segment, which is well served by consumer electronic manufacturers such as LG Electronics India Pvt. Ltd, Samsung Electronics India Pvt. Ltd, Godrej and Boyce Manufacturing Co. Ltd and Videocon Industries Ltd.
Mirc also plans to support its efforts to consolidate its position in the market with marketing initiatives. According to Sundar, the company will spend around Rs100 crore in marketing this year, including the Rs20 crore it is spending on advertisements during the Indian Premier League cricket tournament and the general election.
Besides entering new categories, Mirc is also expanding its manufacturing capacity. The company currently has manufacturing units in New Delhi and Wada (Maharashtra). It is now setting up another unit in Roorkee (Uttarakhand) with an investment of Rs65 crore, which is likely to be operational by June. “We intend to produce home appliances, washing machines, colour televisions and LCD TVs (in the new unit)," Sundar said. An additional line may be put up at the Roorkee facility to manufacture refrigerators.
The company is also exploring options to acquire a design company. “We are looking to strengthen our research and development, for which we are even willing to acquire a design house, but do not have anything on our hand right now," Sundar said.
Mirc Electronics’ net sales for the nine months ended December declined to Rs1,125 crore from Rs1,186 crore in the year-ago period. The net profit also fell to Rs12 crore against Rs28 crore. “Our profits dipped because of the fluctuations in the value of rupee which made imports really expensive...and steep rise in input costs," Sundar said.
Mirc is also currently streamlining its operations with its holding company Guviso Holdings Pvt. Ltd after the company’s board approved the amalgamation of the two companies. Guviso had no business of its own other than its 53% holding stake in publicly listed Mirc. Mirc electronics chairman Gulu Mirchandani had won the control over the holding company last year.
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