Eveready betting on anti-China wave to boost flashlights business

A recent survey conducted by LocalCircles showed that 58% of respondents are willing to boycott Chinese firms while 42% want heavy import duties on Chinese goods to discourage their influx

Eveready Industries, the market leader in flashlights in the country, is betting on anti-China sentiment to grow its business further, which has been fuelled by the escalation of border dispute between India and China.

A recent survey conducted by LocalCircles, involving over 32,000 Indians across 235 districts, showed that 58 per cent of the respondents are willing to boycott Chinese firms while 42 per cent want heavy import duties to discourage the influx of Chinese items.

Incidentally, 50 per cent of the flashlights market in the country is dominated by Chinese imports, which have been increasing. Data sourced from industry officials pointed that while 61.57 million pieces of flashlights, mainly from China, were imported in 2018-19, the number rose by 16.94 per cent to touch 72 million pieces in 2019-20.

Officials pointed that owing to cheaper priced imports, Indian flashlight makers like Eveready and others have been losing business opportunities. Eveready, with around 21 million pieces of annual sales alone accounts for over 70 per cent of the organised domestic flashlight market.

“After BIS was made mandatory, domestic battery sales got a boost and grew by double digits. If the Department for Promotion of Industry and Internal Trade (DPIIT) increases import duty on cheap Chinese flashlights, domestic sales of flashlights would also get a boost”, Amritanshu Khaitan, managing director at Eveready Industries said.

Flashlights account for 20 per cent of Eveready’s annual revenue of over Rs 1,500 crore.

Sources said to boost the Atmanirbhar Bharat initiative, DPIIT is considering policy measures to discourage low-quality Chinese imports which includes measures like increase of import duty on numerous cheap quality items from China.

To promote domestic business, the Mumbai Metropolitan Region Development Authority has already cancelled the bidding process for the design, manufacture, supply, testing and commissioning of 10 monorail rakes because both bids were received from Chinese manufacturers while Indian Railways has decided to terminate the contract of a Chinese company due to "poor progress" in a 417-km stretch on the Eastern Dedicated Freight Corridor. The Railways is also planning to reduce its imports to zero levels and use only Made-in-India components.

Sources said that the Department of Telecom (DoT) may also ask state-owned Bharat Sanchar Nigam Ltd not to use Chinese telecom gear.

However, Khaitan is of the view that the developing national fervour promoting Indian goods is not enough.

“Flashlights are primarily used in rural belts where pricing is very important. Consumers fall prey to cheap quality imports because of lower prices”, he said.

Eveready, with its flashlights and batteries portfolio, has presence across 4 million retail outlets covering 50 per cent of the national retail universe. Around 60 per cent of its outlets are in rural belts.

“There has been an uptake in rural demand after the lockdown and we have enough capacity in place to cater to rising demands. If steps are taken under the current scenario, I think domestic flashlights industry will get a boost”, Khaitan said.