Sanyo-BPL joint venture takes off Eyes Rs 2,000-cr revenues in 3 years

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Bangalore, Jan. 25

SANYO-BPL on Tuesday said it expects to post revenues of around Rs 2,000 crore by 2009 and lead the market in consumer electronics and white goods in five years.

Unveiling the joint venture's plans, the Sanyo-BPL Pvt Ltd Chairman and Chief Executive Officer, Mr Ajit G. Nambiar, told newspersons that the company expects to become the leader in consumer durables and white goods in five years.

"We have been out of the market for over two years now. We are confident we will regain our market share," Mr Nambiar said. Sanyo-BPL is a 50:50 joint venture between Sanyo Corporation and BPL Ltd.

The Sanyo-BPL President and the Chief Operating Officer, Mr Keiji Oshima, said Sanyo expects 5 per cent of its global revenues to come from its operations in India. Currently, 50 per cent of its total revenues are from its overseas markets.

Mr Nambiar said both the brands will be marketed separately. While the BPL brand will be a volume driver, the Sanyo brand will be value driver. While most of the company retail outlets will have both the brands, some of them will have only Sanyo products. Mr Nambiar said most of the products will be manufactured at the BPL's plant near Bangalore and sourced through contract manufacturing especially in North India to gain sales tax benefit.

Mr Oshima said the company will source certain products like washing machines from Sanyo's plant in Vietnam. Sanyo will also look at using India as its sourcing base. "Sanyo is not against using India as its sourcing base," Mr Nambiar said. Sanyo has already started sourcing slim TVs from India. The joint venture expects to post revenues of around Rs 2,000 crore in three years and within two years, it expects to start making profits, Mr Nambiar said. The company has earmarked 5 per cent of its revenues for advertisement.

Sanyo-BPL head for marketing, Mr V.G. Rajagopalan, said Sanyo will launch products in the entertainment electronics segment, digital products and appliances categories, while BPL will focus on consumer electronics space.

In the CTV market, BPL expects to have a market share of 10 per cent in three years while Sanyo expects to have a share of 6 per cent. In volume terms, the joint venture expects to have a 16 per cent share and in value terms, 20 per cent share.

In the washing machine category, six models will be introduced initially.

(This article was published in the Business Line print edition dated January 26, 2006)
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