India-based appliance maker Maharaja Appliances and consumer electronics producer Beltek announced they have teamed up to diversify product portfolios and increase competition against leading Korean appliance producers.
Maharaja Appliances said it has purchased a 50 percent stake in Beltek for an undisclosed amount. According to R.S. Kandhari, CEO of Beltek India, following the sale, Beltek is planning to enter appliance segments with new products, including microwave ovens, air-conditioners, refrigerators, and washing machines.
"This would make us the first regional player to have a complete range," Mr. Kandhari said. "Having a comprehensive product portfolio helps guard against the seasonality aspect and ensures sales all year round." Beltek said it would be sourcing the products from Maharaja's plant in Badi, Himachal Pradesh, India and selling them under its own brand.
Maharaja Appliances, in addition to producing the products for Beltek, would source audio and DVD products from Beltek to sell under its own brands including, Maharaja, Whiteline, and Solec.
Beltek said its focus would remain on the semi-urban/rural markets, and the new products in its portfolio will be priced competitively. The company hopes its new products will help increase its turnover to Rs 250 crore (approx. U.S. $5.4 million) in 2005 to 2006, from Rs 97 crore (approx. $2.1 million) in 2003 to 2004. "White goods should account for about 60 percent of our sales subsequently. There has been a lot of price erosion in the consumer electronics segment -- about 12 to 15 percent last year, and another 6 to 7 percent this year," Mr. Kandhari said. (India Business Line)
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