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As part of its restructuring plan, the electronic major MIRC Electronics Ltd, which owns the brand Onida, has decided to exit from the DVD business and said it will phase out the CRT TV manufacturing by next year. The company said the focus will be on air conditioners, flat panel TVs, washing machines, mobile phones and others.
Gulu Mirchandani, chairman and managing director, MIRC Electronics said that the company closed the DVD business last month due to poor demand and by next year the company will exit from the CRT TV manufacturing.
CRT TV contributes around Rs 300 crore and this would be compensated by the flat panel televisions over the next two years, said Mirchandani, who was in Chennai on Monday to launch range of air conditioners.
He added, “air conditioners and flat panel TVs will be the drivers, since company's failure rates are very less”.
He noted, current market for flat panel televisions is around 5-6 million units in India and the company claims it has a market share of around six per cent.
Washing machines and microavon had a decline this year to the tune of around 4-5 per cent, mainly due to high price.
“I am confident things would improve, considering penetration is low. At present the sentiment is bad, but things would improve after the election next year”.
He noted, mobile phones are eating away consumer durable market, as consumers prefer to spend on communications.
To boost the mobile phone business the company had set up a new management, who was given a target of around Rs 300-400 crore business from mobile phone business, compared to current around Rs 150 crore.
The company which clocked a revenue of around Rs 1250 crore in 2012-13, has set a target to close the current fiscal with around Rs 1,450-1,500 crore.
Mirchandani said, "Current policy needs dramatic change, as it does not support electronics manufacturing in India. We are sending the sector (manufacturing of electronic items) to countries like Thailand and China”.
Quoting car industry as an example, Mirchandani said the Government should look at giving intensives and tax soaps to boost the industry.
He said the industry need certain benefits like sales tax, income tax benefit, duty on imports just as the car industry.
It may be noted, the company decided to put its Rs 400 crore investment plan on hold at Aurangabad, Maharastra stating that “current policies are not conducive”.
