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Talk to anyone at Moser Baer about the slowdown and he admits that
there’s been one–if there hadn’t, they would have grown at 150%! Yes, we
talking about a company which has jumped over 30 ranks in the past two years to
enter the DQ Top 20 club for financial 2001-02. That’s heady going, especially
for a company operating in the hardware manufacturing and exports segment. So
what was slowdown year like for Moser Baer? Revenues grew 102%, profits were up
60% to Rs 221 crore, and capacity was hiked by 100% to 760 million units, from
380 million units. With the additional capacity, the company became the only
entity in Indian IT to be ranked among the Top 3 in the world in any segment.
Also, Moser Baer emerged a key supplier to eight of the top ten global media
brands–among them Mitsubishi and LG–apart from retailing in the local market
under its own brand-names Emtec and Xydane.
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While the growing media market has no doubt helped, the fantastic performance
also stems from Moser Baer India’s strong R&D thrust. MBIL has about 80
engineers, among them two dozen PhDs, purely for R&D and engineering work,
on which the company ploughs in over 2.5% of annual revenues (Rs 15-17 crore).
Among the many feathers in the R&D cap is the development of the proprietary
process PC12D XT, which has helped the company slash manufacturing costs by
10-15%.
And this also helped in completing the capacity expansion in record time and
below project cost. In fact, with the same initial budget, the company now
intends to ramp up capacity to a billion units.
In FY 2000-01, the company had acquired Luxembourg-based Capco, thereby
gaining access to key European brands. A year down the line, branded products
account for 30% to total sales. While this is 5% under that achieved in FY
2000-01, we need to take into account the huge capacity ramp-up–also, it is
always easier to push sales in the OEM segment, against establishing one’s own
brands. Looking forward, the company plans to ramp up capacity to over a billion
units, and increase thrust on the fast-growing domestic market. In parallel, it
plans to increase its marketshare in India, from 35-40% to 50%.