Eyeing over 30 per cent year-on-year growth in the next five years, LG Electronics is planning to invest $300 million in India towards capacity expansion and boost its India-specific research and design activities.
“To meet growing demand for our products across various verticals, we will be investing $300 million by 2013. We are considering setting up a new plant in the South to cater to domestic as well as overseas demand,” LG Electronics India Ltd (LGEIL). Managing Director Moon B. Shin told The Hindu here on Friday.
LGEIL, which currently has two plants in Greater Noida and Pune, will be adding new assembly lines across various product categories.
“The new plant would come up in any of the southern states as it depends on how the state governments cooperate with us and help us in setting up the new plant. We also have the option of expanding our production capacity at the existing Pune plant,” he said.
Commenting on LG's future growth in India, Mr. Shin said: “We hope to see our revenue growing from Rs. 17,000 crore to over Rs. 45,000 crore in the next five years…which means that our contribution to overall global sales will go up from 6 per cent to 12 per cent by 2015. We also see our exports growing exponentially.
“The contribution of exports revenues to our total earnings would go up from 12 per cent to 30 per cent by 2015. Today we do $300 million worth of exports from India.”
He said LCD and GSM products would be their main revenue drivers in the years to come as they would be launching new innovative products.
“We will be launching at least 50 new LCD models this year, including a 3D LCD TV next month, while our GSM mobile handsets will cater to both premium as well as low-cost market (Rs. 1,000-1,500). In the next five years, we hope that revenue contribution from these two verticals would go up from 25 per cent to 50 per cent,” he said. However, refrigerators and air conditioners continue to be its biggest contributors.
Mr. Shin also said that the company's focus was on innovation and they would soon come out with special products in new categories such as kitchen solutions, commercial air-conditioners, healthcare products like air and water purifiers.
“Future lifestyle products are being designed keeping in mind the requirements of Indian consumers, while we will also come out with products specifically for rural markets to increase our penetration in villages by giving rural folks right products at right prices,” Mr. Shin added.