47 MOSER BAER INDIA LTD - Homing Westward

Last year could be termed as a year of consolidation for Moser Baer. With a 20 percent

growth, primarily from a highly competitive international market, Moser Baer is seriously

eying the international data media market, and most of its efforts are focused toward

alt="https://img-cdn.thepublive.com/filters:format(webp)/dq/media/post_attachments/9f42aa3e9388a7d9c981579f607ec5e8b6c5d827958a4d32825f3585d64d83d2.jpg (18258 bytes)" border="0" hspace="2" vspace="2"> CHAIRMAN AND MD: Deepak Puri * PRODUCTS AND SERVICES: Consumables size="1" color="#FF0000">* TECHNICAL COLLABORATION: BASF Magnetic, Germany * START-UP YEAR: 1984 size="1" color="#FF0000">* EMPLOYEES: 764 color="#FF0000">* ADDRESS: 63, Ring Road, Lajpat Nagar III, New Delhi 110024 * TEL: 6919413/15/17, 6844106/9, 6832762, 6927758 * size="1"> FAX: 6849544 PERFORMANCE HIGHLIGHTS l Exported 69.2 million floppies last year. l Set up warehouses in Ireland, Rotterdam, and New Jersey. l Sold 13.1 million floppies in the local market.

that. The company believes that for attacking international markets it needs high

volumes and low manufacturing costs. For this, the

company started a Rs 75 crore project, in 1996, to expand capacity, get into backward

integration, and do R&D to reduce manufacturing costs. Because of the R&D efforts

Moser Baer was even able to design its own machines-and has come up with its proprietary

floppy manufacturing process. This has lead to the bills of materials coming down by as

much as 50 to 60 percent, and the company claims that its cost of production is among the

lowest in the world. Manufacturing capacity has now been expanded to 100 million floppy

disks annually, making Moser Baer the seventh largest floppy producer in the world.

In the global markets, where it had been selling to vendors like BASF of Germany,

Nashua of the US, DataRight of Ireland, Esselte of France, it wants to build its own

brand, Xydan in Europe and the US rather than sell through OEMs. This will also improve

profit margins and reduce dependency on a few buyers. Already, bulk sales to OEMs have

come down from 90 percent to 60 percent and the plan is to bring it down further, to 40

percent. Moser Baer is now developing local sales channels and coming out with product

promotion schemes. Last year it exported 69.2 million floppies, up from 42 million in

1996-97, earning Rs 55 crore. At present, Moser Baer claims to be holding 2.5 percent of

world market share in floppies, and wants to take it to 5 percent in the next three-four

years. On the domestic front, where the company's brand Xydan has not made much of a mark,

it needs a different strategy altogether. However, its main thrust will be on promoting

BASF brand.

Though, last year, Moser Baer did sell 13.1 million floppies in India, marginally

higher than 12.6 million in 1996-97, it now intends to get more aggressive in the domestic

market in terms of advertising and sales channels. The objective is to have at least 15

percent of Indian market share.

The company has also got a Rs 230 crore optical media project coming up in NOIDA, in

collaboration with a European company, for manufacturing recordable CDs and recordable

DVDs. Products from this manufacturing facility, which will be one of the largest in the

world, will primary be for exports. The company is also considering manufacturing

high-capacity floppy disks. Revenues are expected to rev up once the optical media

production picks up, and the company's target is to achieve Rs 350 crore by the turn of

the century.