Hyderabad, June 23 For South Korean consumer electronics major LG Electronics, India could graph the highest growth rate in terms of sales compared with its other markets in the last five months, beating global trends of slackened consumer spending due to recessionary fears.
LG Electronics India Ltd (LGEIL) clocked a growth rate of 18 per cent in the last five months compared with the corresponding period of 2008, mostly driven by increase in sale of products in the refrigeration and AC segments, according to Mr Moon B. Shin, Managing Director. “We are now aiming at a 25 per cent growth in our turnover for 2009 to touch about Rs 13,000 crore. Last year (2008), we had achieved a turnover of Rs 10,730 crore,” he told presspersons on the sidelines of the launch of a new LG Shoppe here recently.
The company is poised to roll out new models in LCD and GSM handset categories in the next three to six months in the domestic market.
Ramping up R&D
As part of its efforts to make the LG products more India-specific, LGEIL is in the process of ramping up its R&D activities. “Our R&D spends in India at present is about Rs 200 crore. We are scaling up these spends to Rs 400 crore in the next three years.
“The primary focus of our R&D here is to design products to suit consumer needs in India, for which we are carrying out comprehensive surveys,” Mr Shin said.
Export thrust
As India gets more globally competitive in terms of manufacturing electronic products, LGEIL is scaling up its exports of products manufactured in the country.
Mr Shin said LGEIL’s export turnover at present was $350 million.
“We are targeting a 10 per cent growth in our exports initially. For this, we may have to set up an additional greenfield capacity three years down the line. As of now, our existing facilities can meet the demand,” he pointed out.
Without being specific, he said the greenfield facility could be located somewhere in the South, either in Tamil Nadu or Andhra Pradesh.
He felt that manufacturing operations in India could be stepped up as the domestic component manufacturing industry gets more competitive.
Source : Business Line