The Hindu Business Line : Electrolux to ride on Videocon's strengths

HOME appliances maker, Electrolux Kelvinator Ltd, is targeting a 20 per cent growth in revenues in the current year to achieve a turnover of Rs 500 crore, a top company official has said.

"Major growth this year will come from A/Cs and microwave ovens," said Mr Ajay Kapila, Vice-President, Sales and Marketing. In July this year, Videocon acquired 91 per cent stake in Electrolux Kelvinator Ltd.

He said A/Cs would account for 20 per cent of the company's sales in 2005, while microwave ovens make up for 11 per cent.

Refrigerators would contribute the lion's share of 63 per cent in Electrolux Kelvinator's sales in India.

"Just two years ago, refrigerators used to account for 95 per cent of our sales. But now other products in our portfolio have successfully grown. In the next 2-3 years, this ratio would change to 50:50," Mr Kapila said.

He said the company is also likely to post an operating profit by end of this year, as compared with a loss of Rs 66 crore incurred during last year.

Now that Videocon has taken over the company, Electrolux's operations in India have become more stable and it will ride on the strengths of Videocon, one of the largest consumer electronics makers in the country. Mr Kapila said the top-level managements of Electrolux Kelvinator and Videocon have looked at possibilities of outsourcing the former's manufacturing needs from the latter, though no formal decision has been taken yet.

"Going forward, there is a possibility to do that, though it is not happening now," Mr Kapila said. While Electrolux has three manufacturing facilities in India, Videocon has 18.

He said Electrolux is planning to increase its presence in B and C class towns for A/Cs and microwave ovens.

The company is eying more than 100 per cent growth in A/Cs, 20 per cent for washing machines and 15 per cent for refrigerators in the forthcoming festival season.

Kicking off its festivals sales with a new offer for Onam in Kerala, Mr Kapila said Electrolux products would be sold in Kerala during the festive season at discounted prices and with surprise gifts.

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