Companies

Onida may embrace the ‘devil’ again for an ‘envious’ performance

Abhishek Law Kolkata | Updated on July 18, 2019 Published on July 18, 2019

Vijay Mansukhani, Managing Director, Mirc Electronics

A cave, cobwebs, snakes and the devil with long nails and a mocking smile. All these negatives came together sometime in the 1980s to form an iconic advertisement for TV-maker Onida.

The iconic devil campaign was discontinued in 2009. But, come Diwali 2019 and Onida may revive the devil ad-campaigns across its white goods portfolio that includes television sets, washing machines and air- conditioners.

While the devil and ad-campaigns are just a part of the turnaround plans, Mirc Electronics - makers of Onida – is looking at non-captive manufacturing opportunities (third-party manufacturing for other brands) amongst other options. According to Vijay Mansukhani, Managing Director, Mirc Electronics will get back into the game as it bolsters promotion and distribution. He did not mention the ad spend the company is planning.

“The ‘devil‘ and the ‘neighbour’s envy, owner’s pride’ advertisements were the cornerstone for the company and it was a way of telling the world that our products are better than the competition‘s. We intend to re-start the campaign surrounding the devil, focussing on Diwali sales,” he told BusinessLine.

Incidentally, Onida re-introduced the devil for a brief period for air-conditioners, around the IPL season in 2017. However, Mansukhani is hopeful that the plans to re-focus on the campaign will boost the prospects of the entire portfolio of products.

Hard times

Mirc, one of the oldest home-grown TV-maker, was once an aspirational brand. But it lost out to deep-pocketed foreign players such as Sony, Samsung and LG,. Its financials too took a hit with plunging market share.

To add to its problems, a major fire in 2012 at its factory at Roorkee impacted the business. From FY12 onwards, the company started posting losses.

Though it started with TVs, the company later diversified into air-conditioners, washing machines, microwaves, DVD and home theatre systems, mobile phones, projector systems, and LED lights.

Over the past three years, a restructuring exercise has been on. The company moved out of verticals like LED lights, mobiles and DVDs. Mirc was also successful in bringing down its debt to around ₹60 crore, banking primarily on sale of non-core assets like warehouses, Mansukhani said.

The company, in FY-19, reported a net loss of ₹4.40 crore as against a net profit of ₹23.49 crore in FY-18. Turnover in FY-19 stood at around ₹648 crore.

Eyeing 10% growth

According to Mansukhani, the company is eyeing a 10 per cent growth in turnover this fiscal (FY-20), banking primarily on categories like washing machines (where it is eyeing a 30 per cent growth) and air conditioners (eyeing a 20 per cent growth). TV sales, accounting for a major part of its tunover, are expected to remain stagnant.

Foray into e-commerce through a separate brand and targeting the value-conscious consumer, are expected to help shore up turnover too.

Third-party manufacturing

A further boost in turnover will come with the company leveraging its existing capacities by opting for third- party manufacturing. Mirc had invested on automation of its units — Roorkee and Mumbai — and these capacities can be used. It does manufacturing for Reliance Retail and is in talks with five more consumer durable companies in this regard.

“We can sell some more non-core assets if funds are required,” Mansukhani added.

Published on July 18, 2019
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