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Orient Electric, part of $1.6 billion CK Birla Group, is expected to set up a manufacturing facility in South India within two years' time, to cater the regional and overseas markets. The plans will be finalised once the electrical appliances business under Orient Electric is demarged from the Orient Paper and Industries Ltd, for which the process is on, said a senior official from the company.
The company currently has a fan manufacturing facility in Faridabad, Haryana and another one in Kolkata and has its strong presence in North and Western markets. While it claims to be the second largest player in fans, after Crompton Greaves, with around 20 per cent market share, its presence in South India is weak. It is now focusing on increasing its market presence in south also.
"We will be looking at a manufacturing facility in South, probably within two years from now. It will cater to the regional market and with the connectivity to ports, it would also cater to the exports market," said Sameer Tandon, senior vice president and business head, Fans, Orient Electric. However, he refused to reveal the location it is expected to set up the facility.
He said that the details would be ready only by the de-merger between Orient Paper and Orient Electric. Around 13 lakh fans out of the 90 lakh fans it sold last year, was into exports, and the company has presence in Middle East, Sri Lanka and into African countries. The overall fan market during last year was 4.5 crore units, of which the company sold 90 lakh, he said.
The company is also looking at doubling its market share in the super premium fans market, which is priced above Rs 3,500 a unit, in next two years. At present, it has a lower presence at nine per cent market share in this category.
The company on Monday launched a super premium fan, Aeroquiet, which claims to have focus on performance with more air circulation and lesser noise, will have a price ranging between Rs 4,700 to Rs 10,000 a unit. The product range, launched in Tamil Nadu now, will be launched nationally in February, next year. Tamil Nadu accounts almost 10 per cent of the overall fan market, he added.
It is targeting a market leadership in the fan business in next three years, he added. The premium and super premium markets are growing at around 15-16 per cent compared to the 3.5- four per cent growth of the standard fan segment.
The fan business contributed to around Rs 1,200 crore out of the total Rs 1,700 crore revenue of Orient Electric last year, making it the largest business under the electrical appliances business, while the other businesses like lighting and switch gear business were comparatively later additions, he said.
