TCL bullish on colour TV market

Leading Chinese electronics company TCL plans to expand its branch and dealer network in India in line with its increasing focus on the colour television (CTV) and air-conditioner (AC) markets.

The company is all set to launch ACs with 2-star ratings from the Bureau of Energy Efficiency by July this year.

"We will initially roll out 2-star rated ACs and our full range of star-rated ACs next year," said TCL managing director Warren Wang.

Wang said that India was the most important market for TCL after China, and the company expects the Indian CTV market to log sales of over 1 crore units by the end of 2009.

With a 5 per cent market share last year, the company is keen to fine-tune its brand positioning in the CTV market and ride the coming wave.

"We will double our branch and dealer networks, as well as after sales service centres network by 2010, from the 21 branches at present. Our current 5,000-strong dealer network, 300-strong sales and service dealer (SSD) network and 120 after sales service centres will grow exponentially to match our branch presence. The southern Indian region will play a vital role in our growth strategy in 2007, especially Tamil Nadu, which alone has more than 1,000 dealer and sub-dealer outlets at present," Wang said.

TCL India general manager Rajesh Rathi said the company was targeting a growth of 60 per cent in the AC segment, 15 to 20 per cent for CTVs, and 25 per cent growth for its DVD players.

"Split ACs is the robust new revenue stream for all industry players. Last year, splits constituted 90 per cent of our AC sales revenues," he said.

In 2006, TCL sold an estimated 5 lakh CTV units, 50,000 AC units and 1 lakh DVD players. The company turned in an estimated Rs 400 crore in revenues in calendar 2006 and is targeting revenues of Rs 500 crore in 2007.

Brand promotion at the company is also set for a fillip. TCL India will park 7 to 8 per cent of its annual revenues in advertising and other promotional activities in 2007.

"We are currently surveying the market and will come up with optimum price points before pushing in new products on the home appliances front," Rathi said.

The company has been scouting for locations in Andhra Pradesh and near Noida for its manufacturing facility. TCL plans to assemble CTVs and DVD players at the facility,sourcing key components locally. Wang declined to give further details of the new plant. noting that negotiations on the plant's location were in the nascent stage.

TCL currently presides over a scattered assembly line in India through six original equipment manufacturers (OEMs) who import the kits and assemble them locally. Most of its competitors in the Indian colour television market operate through the OEM route.

The home appliance segment will see new products being introduced.