Haier Aims For 33% Growth In Turnover This Year, Investing Rs 1,500 Cr

Consumer durables firm Haier India aims for a 33 per cent growth in turnover to Rs 8,000 crore in 2023, helped by the expansion of its product portfolio and sales network and premiumisation, said its President Satish NS.

Haier India is investing Rs 1,500 crore in the second phase of expansion at its Greater Noida facility, mostly on the backward integration and is expected to complete by 2025, which will in turn help it increase the localisation of the components.

This investment is part of Haier India's earlier commitment to invest around Rs 3,100 crore. At the Greater Noida facility, Haier India manufactures refrigerators and washing machines, and in the next phase, it would have an injection moulding facility and a PCB plant. It is also mulling a compressor plant in JV for its cooling products business here. "From here we cater to domestic and export to neighbouring markets such as Sri Lanka, Nepal and Bangladesh. Going forward, the idea is to build it a hub for the domestic market and exports," Satish told PTI.

Haier has the capacity to roll out one million units of residential air condition units, at present and its plans to double the capacity. Similarly, it has a capacity of 1.5 million units for washing machines, which will be expanded further.

"As a company, last year we closed at Rs 6,000 crore and this year we plan to look at Rs 8,000 crore," he added.

When asked about the growth drivers, Satish said this will be led by its AC business, which is a major growth engine for Haier India, flat panels, refrigerators, washing machines etc.

"We also have a huge tailwind from expanding of channels and are exploring the various channel opportunities," he said adding "premiumisation will also help" as it increases the average product price.

Besides appliances, Haier India is also looking at the allied segments such as cold chain solutions, medical freezers and commercial airconditioning.

"We see that well aligned with our product strength. Commercial air conditioning is an area that we are now looking at aggressively. We see a future in cold chain solution and commercial airconditioning, where we have good technology with backward integration and manufacturing," he said.

He further said, "We would focus on the segment, category or industry, where we have our own manufacturing capability and R&D because that's where you will be able to address in a long way rather than trading only, which has no future."

The company is working to increase the localisation of the products by investing in the component manufacturing ecosystem. This would also help to increase efficiency and have better quality control, Satish added.

Haier India is also investing in R&D, which in turn helps it innovate India-specific products from its stable.

Presently, the local value addition is around 75 to 80 per cent and after the completion of the second phase, it would go to 90 to 95 per cent, he added.

The company is also strengthening its after-sales service support and is investing in that aspect. According to Satish around 75 per cent of sales service support is provided by the company itself. Besides, the company is also working in tandem with upgrades in technology and other aspects such as the hiring of fresh young people, giving a fresh idea for the business.

Haier India has also got a tailwind from the bankruptcy of the leading domestic brand Videocon, operating in the space. The Dhoot family-led firm was among the top five brands in the consumer durables space five-six years before.

It is a 100 per cent subsidiary of the Shandong, China-based Haier group. Besides Greater Noida, it also operates a factory in Ranjangaon, Pune.