The Hindu : Anchor group entering new areas

Online edition of India's National Newspaper
Sunday, Feb 15, 2004

Business

Business

Anchor group entering new areas

By N. N. Sachitanand

BANGALORE, FEB. 14. The forty-year old, Mumbai-based Anchor group is going to aggressively enter new product lines in the home electricals, FMCG and white goods sectors. According to Sashi Nair, President of Anchor Electronics and Electricals Pvt. Ltd., the Group is targeting a doubling of its annual turnover to Rs. 1,000 crores in just another year, as a result of these initiatives.

Anchor Electricals is already one of the leading manufacturers in the world of household electrical switches, dimmers, door bells and fan regulators. In the mid-1990s it diversified into making some of the other household electricals such as housing wires, MCBs, luminaries and electronic energy meters. The company has 17 manufacturing plants across the country and is now setting up its 18th plant at Bhuj in Gujarat, involving an investment of Rs. 70 crores, to make luminaries. When this plant goes on stream in the next few months, Anchor will have a capacity to turn out 19 million filament bulbs, 11 million tubelights and 4.5 million compact fluorescent lamps per year.

In December 2003, Anchor announced a joint venture with Woods Electricals of the U.K. to make premium modular switches. The company is now poised to enter into the home automation market such as automatic door openers, anti-intrusion alarm systems, remote control systems for appliances, sensors, gas leakage systems and the like. Anchor has tied up with Ave Electricals of Italy for the technologies in this product line. Next on the list for Anchor are touch screens for house controls, T5 lamps , non-contact switches and LEDs.

"An average Indian home spends around Rs. 20,000 on electricals,'' says Nair. "Our earlier range of products were encompassing a minor share of this. With our expanded range, we now expect to cover a large portion of this expenditure.''

Although Anchor is a dominant player in the domestic home and office electricals market, its exports are marginal, accounting for just 2 per cent of the turnover. This will be changing soon, according to Mr. Nair. Two years ago, the company started a marketing outlet in Dubai, followed by one in London last year. Anchor is also exploring tie-ups with prominent design and styling organisations in Europe to be able to make products suited to the tastes and standards of the advanced countries. Anchor is hoping that in the next five years, at least 20 per cent of its turnover will be accounted for by exports.

The Anchor Group took up the manufacture of white goods in 1995 through a 50/50 joint venture with Daewoo of South Korea. This venture had touched an annual turnover of Rs. 200 crores by 1998. However, due to financial troubles at the Korean company, the venture had to mark time. Three months ago Anchor took over the whole company, with plants at NOIDA and Pune. The company has restarted with refrigerators in December and will soon be launching air conditioners and washing machines. The target is to touch Rs. 200 crores sales in 2004/05.

The FMCG division of Anchor has two plants in Daman and started with toothpaste in 1999. The division now has sales of Rs. 150 crores annually. Two more plants will be opened in the next five months. While talcum powder has just been launched, next in line are shampoos and soap.

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