Domestic consumer durable players are gearing up for the festive season by increasing capital expenditure to increase production across categories. While big players like Videocon Industries has assigned a capital expenditure of ₹300 crore, smaller companies such as Mirc Electronics are waiting to launch its ₹32 crore rights issue for increasing working capital on the eve of the festival season.
Panel TVs are the focus for most Indian durable companies who want to compete with the MNC brands through affordable prices and new technologies.
CM Singh, COO, Videocon Industries said, “We are increasing our capex to ₹300 crore for the festive season as we have to create new moulds for our televisions. Huge investments are required to upgrade but we have to undergo capacity expansion and improve our technology at our manufacturing bases at Aurangabad and Kashipur.”
Videocon has recently launched its 4 K high definition smart TVs pegging it a notch lower than LG and Samsung in the same segment. Today Sony leads in panel TVs with a 22 per cent share while Videocon shares stand at 16 per cent.
“We expect to sell 1 million panels during the festival season segment during the next two months as there is growth of 50 per cent in this segment. Last year panels was a 6.5 million category which has gone up to 9.5 million this year,” added Singh.
“We are waiting to launch our rights issue and even if it is not subscribed, the promoters will buy the shares of the issue and increase stake in the company as we need funds for capacity expansion,” said Gulu Mirchandani, Managing Director, Mirc Electronics.
Kamal Nandi, Business Head, Godrej Appliances said, “There will be capex enhancement during the festival season as we need to create better platforms for our frost free refrigerators and washing machines.” Godrej is planning to launch new models of 400 litres ‘Frost free’ refrigerators and 7kg semi automatic washing machines during the season.