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Haier to double India capacity by next fiscal

Thursday, 3 April 2014 - 9:14am IST | Place: Ahmedabad | Agency: dna

Chinese consumer appliances and electronic goods maker Haier is adding two production lines to its manufacturing facility at Ranjangaon, Pune, to double capacity to two million units by early next fiscal.

The new building is at an advanced stage of construction in its 40 acre campus, and the two new lines will be operational by the 2014-end.

Eric Braganza, president, Haier India, told dna that the new lines will be primarily for two product categories.

"We are expanding production capacity in Pune and two manufacturing lines will be added for air-conditioners and washing machines. These lines will involve a capital expenditure of Rs 50 crore," said Braganza.

The facility that employs 600 people will see the headcount increase by 40%. The unit currently makes direct cool and frost-free refrigerators in addition to assembling a few other products.

In consumer electronics, the company which imports all products plans to do some assembling (24 inch and 32 inch panels) by year-end. It is also looking to set up another manufacturing unit in north India in the next fiscal.

Haier India looking to break even this year with an aim to touch a turnover of Rs 2,000 crore and a 33% year-on-year growth across categories. For 2015, it is targeting a turnover of over Rs 3,000 crore.

In February, it had announced introducing 71 new i-age products, increasing the total number of its stock keeping units to 268 in 2014.

Braganza said the feature-rich new product range coupled with attractive pricing will help achieve the targeted numbers. "In each of the categories, we have grown on an average 37% (value growth) across the board since January. This has been possible mainly due to smart pricing wherein our products are 3-5% lower than premium but expensive than the lower-end brands," he said.

In the price and quality sensitive Mumbai market -- among the biggest for Haier in the western region -- the company has grown 70% over last year, he said.
The company retails its products through 6,500 outlets across the country in addition to over 160 Haier Centres and experience zones.

On the overall market scenario, Braganza said none of the consumer electronics and durable categories (compressor-based) has seen any major growth since January primarily due to the weather. Price hikes of about 10-20% too have not helped.

"We will not see major growth in the first half of this calendar year, except for the air conditioner and refrigerator category which is likely to see some spurt due to rising temperature," he said.

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