Hager announces new business model for India

Hager announces new business model for India
 
Hager Electro Pvt. Ltd., a 100 per cent subsidiary of Hager Electro SAS, France, has announced its new business model in India. In an interview with EPR, Benoit Lecuyer, Managing Director, Hager India, elaborates their plan for Indian market. Excerpts:
 
Hager Group has announced Project 2015, a special plan for Indian market. Can you elaborate the same?The Hager group in its strategic initiative Project 2015 has identified India as one of the strategic countries to invest and grow market share ambitiously. The objective is to double revenues by 2015. We will continue to invest more than 5 per cent of our turnover in new products and we are open to possible technical alliances. Hager products are now distributed through a network of more than 170 channel partners. We expect around 25 per cent growth in Indian market year-on-year.
 
What will be the market size for your kind of products?It’s difficult to say. For energy distribution, it’s going to be around Rs. 1,000 crore. For home automation, it may range between Rs. 70 to 100 crore. We have a lot of jobs to do: first convince a builder, architects, the consultants, and the contractors to propose the solution.
 
You mentioned that you anticipate almost 25 per cent year-on-year growth for your company. So do you also expect the same kind of growth for the market?No. The market growth would be around 10 to 12 per cent, especially when the next year GDP growth would be 6 per cent – people can even say 5.5 per cent – and electrical products would grow by 10 to 12 per cent. As we’re going for consumer market, we have anticipated 25 per cent.
 
You also said that your objective is to double the revenue by 2015, how are you going to achieve that?We launch a new range in every 3 months. Today we’ve launched a mid-segment market for same application but with few features. And then we’ll make some friendly acquisitions.
We have launched KNX protocol based home automation solutions, H3 moulded case circuit breakers (MCCBs) and photovoltaic system protection. We have recently acquired Elcom – a German based organisation specialised in video door phone business.
 
What is your current revenue which you are planning to make double? How much you are expecting?It’s between Rs. 120 – 200 crore. We would trigger more than Rs. 400 – 500 crore, excluding the price increase at constant parameter. There should be more energy and more market share, etc.
 
To achieve that what kind of additional investment you are going to make?We’re focusing more on excellent logistics and distribution centres to operate the extreme part of India. We’re also planning to recruit people, expand good network and share Hager solutions to contractors and consultants.
So what is your investment plan by 2015?The first one is R&D and we’ll recruit around 90 people in the different fields from sales to marketing.
 
To extend your facilities, how much are you going to spend?As of now, nothing is fixed yet. But the machine capacity may go by 30 – 40 per cent. We believe if you have to leverage with the best technology in India, Brazil or China, you have set up with best machines. We also give importance of quality of our engineers.
 
In India, which are the potential markets you are focusing initially, apart from Mumbai and Chennai?We are already well established in six main cities: Bangalore, Delhi, Chennai, Hyderabad, Mumbai, and Pune. The second set of cities is Coimbatore, Ludhiana Chandigarh, and Cochin. We’re also considering Goa as second tie.
 
Are you planning to cater to the other neighbouring countries as the Pune facility is coming in full-fledge?The Indian market is so huge that the specification takes time for a full hotel, shopping mall or for a 5-star hotel. We have lot of city work to do and then we’ll set up the premises. We are already operating in Bhutan and Nepal, and planning to expand to Bangladesh and Pakistan.