Bajaj Electricals to set up R&D centre, up rural focus

Pune: Bajaj Electricals Ltd plans to establish an integrated R&D centre that will drive innovation and help it create cutting-edge technology across its three business verticals.

The company, which gets nearly half its top-line from the consumer durables and kitchen appliances business, is also increasing its focus on non-urban centres.

It plans to develop appliances specially aimed at the needs of this market, such as mixers and irons.

Citing the example of Bajaj Auto, which has created its own technology for its motorcycles, Shekhar Bajaj, CMD of Bajaj Electricals, said: “The R&D centre will study market needs and make what the

consumer wants.”
While the location is yet to be finalised, it is likely to be around Mumbai, he said.

Anant Bajaj, JMD, said at a press conference here he wants to move away from the mindset of differentiated quality products (appliances) for the export and domestic markets.

“Cutting-edge technology is the only way for products to remain strong,” he said, adding that the product could then be sold across geographies. At present, exports account for a mere 1 per cent of Bajaj Electricals’ sales, and there is a lot of scope on this front, he said. “We may even have some manufacturing and assembly in export free markets to make exports viable,” he added.

As part of a strategy to increase its focus on rural areas, Bajaj Electricals has set up exclusive showrooms that display its entire range of consumer products.

At present, 50 of 68 Bajaj World outlets are in non-urban locations, and the plan is to grow the total number to 100 in the current year.

Turnover target
The company expects to close the current fiscal with 25 per cent growth to a turnover of Rs 4,200 crore, against Rs 3,400 crore last year.

While the consumer durables and lighting businesses will each grow 15 per cent to Rs 2,100 crore and Rs 900 crore, respectively, the projects vertical will see 70 per cent growth to stand at Rs 1,200 crore (Rs 640 crore).

“We want to execute and hand over older projects and close all the gaps by the year-end. Then we can focus on our new order book,” Anant Bajaj said. The company’s projects order book at the end Q3 14 stood at Rs 1,465 crore, and is expected touch Rs 1,500 crore by the end of the fiscal.

“Cutting-edge technology is the only way for products to remain strong.” Anant Bajaj, JMD, Bajaj Electricals