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Anchor Electricals, a wholly-owned subsidiary of Japan’s Panasonic Corporation, is planning to set up a new 30-acre factory in Sri City, an integrated business city in Andhra Pradesh around 50 km north of Chennai.
The facility in which the company will invest around ₹200 crore will mainly produce fans, wiring devices and switchgear and will cater to Central and South Indian markets, Vivek Sharma, Managing Director, told BusinessLine.
He added that the plant will start operations in 2020, generating up to 2,000 new jobs, out of which 70 per cent are most likely to be reserved for women. Currently, the company employs 9,000 people across its offices and eight factories.
Anchor was acquired by Japan’s Panasonic Corporation over a period of three years from 2007 to 2010.
According to Sharma, who spent over three decades in consumer electronics sector before joining the company in August 2017, Anchor Electricals has, for the first time, grown by 28 per cent to ₹2,980 crore in 2018 fiscal. Earlier, it used to grow at a compound annual growth rate (CAGR) of 13 per cent. The company has also doubled its profit to ₹470 crore.
After Sharma took over as the Managing Director, he has restructured Anchor’s sales team and product portfolio. The focus, he said, is to grow the company’s footprint in segments such as lighting, fans and wires where Anchor currently has just 3 per cent market share.
In the switchgear business, Anchor enjoys a 7-8 per cent share, however, the total size of the market is estimated at ₹4,000 crore, Sharma explained.
“It’s a very small basket. Cables is four times of that, or if you look at lighting market, its potential is ₹30,000 crore,” Sharma said.
Double-digit growth
As Anchor is eyeing over 20 per cent CAGR growth over next five years, acquisitions could be one of the growth drivers. “Further acquisitions are possible, and there are two or three big acquisitions that we are considering right now, in fans and switchgear categories. But you cannot depend on sustainable consistent long-term growth by betting on acquisitions,” Sharma said.
The company name, too, is likely to undergo changes in the coming months with Anchor likely to be changed to Panasonic, Sharma hinted, although both brands will continue to be used in the market as each of them caters to different customers.
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