Godrej Agrovet to foray into micro-irrigation business

MUMBAI: Godrej Agrovet Limited (GAVL), a Godrej Industries company, plans to enter the micro-irrigation business by setting up a new subsidiary.

"We have big expansion plans for our agriculture business under GAVL. Under GAVL, we are soon planning to foray into micro-irrigation business, including drip irrigation, by forming a new subsidiary," Godrej Industries Chairman Adi Godrej said here.

The new subsidiary will be formed this fiscal year, he added.

The size of the market for micro irrigation systems, which involve drip and sprinkler irrigation, is around Rs 3,000 crore in India.

Meanwhile, GAVL has formed a subsidiary, Godrej Seeds and Genetics Limited (GSGL), which will serve as its vehicle for entering the hybrid seed business in the country.

GSGL, to be based in Hyderabad, will focus on three major crop seeds -- maize, paddy and bajra -- for distribution in states like Andhra Pradesh, Bihar, Karnataka and Maharashtra and will handles all existing hybrid seed sales and breeding activities previously managed by Godrej Agrovet.

"We believe the future of the Indian seed industry is still being written. Despite the presence of multinational players, there remains tremendous scope for introducing superior germplasm to Indian farmers. For a few years now, we have been working quietly in this space and we are ramping up our efforts for a major commercial debut," GAVL Managing Director Balram Singh Yadav said.

GAVL is a diversified agri-business company having interests in animal feed, oil palm plantation, agri-inputs and poultry.

Its sales jumped by 40 per cent in the first quarter of FY2011-12, its best-ever first quarter performance, vis-a-vis the first quarter of FY'11.

Meanwhile, speaking on the potential of the agri-businesses, Godrej observed they have reported strong growth in revenues and profits owing to robust demand for products across business segments.

All of GAVL's business verticals, including oil palm, agri-inputs and animal feeds, are poised to deliver significant growth, he said.

The oil palm business has been an outperformer during the quarter, with maturing plantations yielding higher output, Godrej said, adding that GAVL also has new products in the pipeline for FY2011-12.

Meanwhile, Godrej Industries' consolidated net profit grew by 46.34 per cent to Rs 71.33 crore in the first quarter of FY'12, compared to Rs 48.74 crore in the corresponding quarter of the previous year.

Preethi Kitchen Appliances sets turnover target of Rs 560 cr for current fiscal

COCHIN: Preethi Kitchen Appliances Pvt Ltd, a leading player in kitchen appliances market in the country, has set a turnover target of Rs 560 crore for the current fiscal. The company had achieved a turnover of Rs 425 crore last year.

A leading player in the mixer grinder segment, Preethi sold 1.5 million units in the country last year. The total sales of mixer-grinders in the country stood at 6 million units. This year the company plans to sell 1.8 million units.

The company sold 2.80 lakh units in Kerala last year achieving a turnover of Rs 75 crore. This year the company has targeted Rs 100 crore turnover from the state, Mr Vijay Sreenivasan, Managing Director of the company said here.

Preethi range of appliances includes mixer grinders, induction cooktops, coffee makers, kettles and irons etc. The company has seven manufacturing units spread across Tamil Nadu and Himachal Pradesh.

LG eyes 33% marketshare of the country’s home appliances market

NEW DELHI: Korean consumer durable maker LG is eyeing 33% marketshare of the country's home appliances market this year. The company plans to invest close to Rs 350 crore in production and marketing of its home appliances range to attain the targeted marketshare.

"India is a very strategic market for LG Electronics and our objective is to introduce flagship products into the market which reiterate the company's efforts to constantly create and introduce new technological innovations," Soon Kwon, MD, LG India said.
The company's home appliances range is expected to grow at 35% this year.

It launched a new range of microwave oven and washing machine on Thursday. The new fully automatic washing machines range is priced between Rs 24,290- 70,990, while the microwave ovens are available between Rs 18,490-21,290.

"At LG, we maintain a relentless focus on finding out what customers want and then reflecting those desires and needs into products that enrich their lives," Kwon said.

Indian toy industry worth Rs 1700 cr is here to stay as toys inspired by flicks create ripples among kids

NEW DELHI: If you don't know who Lightning McQueen, Marlena and Sebastien are, ask any preteen in your neighbourhood and they will probably show you one or more of them. These are car characters from Hollywood computer animated film Cars 2 which kids know all about.

Cars 2 is the latest success story in India's booming toy economy that has become a huge money spinner for toy makers, retailers, some Hollywood studios and children's television channels.

The stats speak the story: the Indian toy industry is estimated to be worth Rs 1,700 crore and growing 15-20% a year. According to a Euromonitor study, spending on toys and games in India is set to grow at 157% between 2009 and 2014, much faster than other Asian countries such as China (84%), Taiwan (35%), South Korea (33.1%) and Singapore (17.2%).

"Consumption is not just a necessity but has become a language to express oneself," Future Brands, CEO and social commentator Santosh Desai said. Attention deficit of working parents towards their children is certainly one of the reasons for booming toy market, but keeping kids engaged is in itself a very big task. So, here toys and gadgets come into play, Desai said.

So, kids are running the show, as working parents - richer and much busier than the previous generation - try to make up for their lack of time to spend with kids by pampering them and conceding to most their demands.

Funskool, a joint venture between tyre maker MRF and US toy maker Hasbro Inc, recently introduced two high-end block games - Mindstorm and Taj Mahal- carrying price tags of Rs 22,000 and Rs 27,000, respectively.

It clocked revenues of Rs 80 crore in the year ended March 2011, while Mattel, which sells toys under Fisher-Price, Barbie and Hotwheels brands, has an India turnover of approximately 300 crore.

Toys inspired by flicks such as Transformers, Batman, Spider Man, Madagascar and Lord of the Rings too have created ripples among kids and young adults. Television characters and cartoons-inspired shelf-scorchers include BeyBlades, Ben 10 and Blazing YoYos.

There are much more to come. Toy maker Mattel's miniature replicas and Simba Toys' remote-controlled cars inspired by the Disney Pixar production were instant sellouts. The Walt Disney Company VP, consumer products, publishing and retail, Roshni Bakshi says the toys helped its licensee partners double their sales volume.

"Today with the presence of so many modern trade stores and the whole experience of touch and feel available, the Indian toy industry is poised for growth," says Bakshi.

BOOMING MARKET
Indian parents already spend an average Rs 250-300 on a toy and this is going up more and more innovation-driven high-end toys and games - from high-priced board games and play gyms to BeyBlades and remote-controlled planes - enter the market.

"The influx of hi-tech electronic toys accompanied with electronic gaming gadgets is making the Indian toy market on its way to becoming one of the most advanced industries in the subcontinent," says R Jeswant, marketing and sales head at Funskool, the second largest toy maker in the country behind Mattel.

Apollo Tyres leases 10,000 hectares in Laos for rubber plantation

KOCHI: With the domestic tyre industry facing a crisis due to the global shortage of natural rubber, Apollo Tyres Ltd has taken on lease about 10,000 hectares of land in Laos, in South-East Asia, for rubber plantation, a top company official said.

ATL (rpt) ATL is the first Indian company to acquire a property for growing rubber. It would take 2-7 years for the yield to be tapped, ATL (rpt) ATL Chairman and Managing Director Onkar S Kanwar told reporters here last night after a meeting of the company's board of directors.

Apollo's largest unit is situated at Limda, in Gujarat, and its two other units are at Perambra and Kalamassery, Kerala. Its latest next generation plant is near Chennai and the four together have a combined production capacity of around 1,180 tonnes of tyres a day in India.

In South Africa, the Ladysmith and Durban plants account for a combined capacity of around 180 tonnes and the Enschede plant in the Netherlands adds another 180 tonnes a day, taking its total current production capacity to around 1,550 tonnes a day.

Kanwar said Apollo will invest Rs 500 crore this fiscal on its units in India and abroad. Of this, 6 million euros would be invested in Europe, USD 30 million in South Africa and the rest in India, he said.

The company will pump Rs 40 crore into its Perambra unit, in Chalakudy, and Premier Tyre facility, at nearby Kalamassery.

The rest would be utilised for capacity augmentation at the Chennai plant, which manufacturers tyres for trucks and cars.

The plant capacity would be enhanced to produce 6,000 tyres per day for trucks, compared to 3,000 at present, and 16,000 cars tyres per day, as against 8000 at present, Apollo Tyres Vice Chairman and Managing Director Neeraj Kanwar said.

The company aims to become one of the top 10 global tyre companies in the next five years.

On the industrial climate in Kerala, where Apollo declared a lockout some months ago at its Perambra unit, he said both plants are doing well. By and large, labour was good. But in Chennai and Gujarat, there was very a different environment, he said.

He denied reports that the company had plans to shift one of its units in Kerala to Gujarat due to the labour troubles.

India is Apollo Tyres' largest market, accounting for 62 per cent of revenues, while Europe contributes 25 per cent and South Africa 13 per cent. The company exports tyres to over 70 countries from India, Europe and South Africa, Apollo Tyres Chief - India Operations Satish Sharma said.

Honda Motor bets on 100-cc bikes for rural push in India

NEW DELHI | MUMBAI: Japan's Honda Motor, the world's largest motorcycle maker, is betting on the small capacity 100-cc economy bikes as it embarks upon a rural push in the world's second biggest two-wheeler market, said people with knowledge of the development. The Tokyo-based firm, which separated from its long-term Indian partner turned competitor Hero MotoCorp, has appointed five management teams across India led by Japanese executives to create a new decentralised marketing structure for consistent sales, people from the industry told ET.

The Japanese two-wheeler maker is working on a new version of the CD platform in the 100-cc segment, where Hero's CD Dawn and CD Deluxe have the highest sales. Honda's new bike based on the 100-cc technology is targeted at India's vast rural hinterland that contributes almost half of the volumes to the nearly 5 million bikes Hero sells every year. The thrust on rural market is a reversal of sales strategy for Honda, which has so far been garnering most of its sales from cities and big towns.

"The company is currently focusing and tweaking bikes relevant for the Indian market to get closer to the customer ," said Abdul Majeed, auto practice leader, PwC. The 100-cc bikes laid foundation for Hero MotoCorp, erstwhile Hero Honda , to emerge as world's largest twowheeler firm in terms of volumes. Last year, Honda sold its 26% stake in Hero Honda to India's Munjal family while the technology agreement between Hero and Honda permits the former to use the joint name in products till 2014.

Honda, which owns the CD brand globally jointly with Hero, is likely to bring in a new improved engine with fresh design cues to attract young and rural India. Hero's claim on the CD brand exists only till 2014, by when Honda wants to emerge as a major player in the Indian circuit. Honda Motor did not reply to an email query from ET about its rural thrust and new marketing strategy. However, the company said it aims to emerge as a major player in India in the next few years as it comes up with strategies to consolidate.

Suzuki Motorcycle sales up 39 pc in August

NEW DELHI: Two-wheeler maker Suzuki Motorcycle India today reported 39.12 per cent jump in sales in August to 26,897 units.

The company had sold 19,334 units in the same month last year, Suzuki Motorcycle India Pvt Ltd (SMIPL) said in a statement.

"We have received very good response from the market to all our products. The growing customer satisfaction among present owners of Suzuki products has led to a positive word-of-mouth in the market," SMIPL Vice-President (Sales and Marketing) Atul Gupta said in a statement.

Auto component sector demands labour reforms

NEW DELHI: Delay in labour reforms hampers employment generation in the automobile component sector, the nodal agency for the Indian auto component industry said Tuesday.

"We believe that employment will get a boost by labour reforms which is the need at the moment," Srivats Ram, president, Automotive Component Manufacturers Association of India (ACMA) told reporters on the sidelines of an industry event here.

According to Ram, the slow pace of labour reforms hampers the huge opportunity for the country's workforce to be employable in the sector.

"We currently employ around a million people directly and another million indirectly and this number is expected to double in the coming time," Ram said.

For this to happen, reforms are needed, he said.

ACMA further said that the industry was looking forward to a flexible labour policy and that its views on the same are being represented in front of the human resource and labour committees of the planning commission for the twelfth five year plan.

"We want a policy that allows us to adjust our work-form as per market economy. In the medium-to-long term there will be ample employment opportunities in the sector and there should not be any uncertainty that it will be a hire and fire policy types," Ram said.

The Indian auto component industry currently has 50 percent of its employees as permanent and the other half on a consultant basis.

"We want this 50 percent permanent number to be maintained and even grow as we spend a lot of money on training our manpower but there is a need of flexibility here," Arvind Kapur, ACMA vice president said.

Commenting on the recent labour troubles in the auto sector, Kapur said there is a need for better understanding and cooperation between the management and the labour.

"We have a very young and aspiring workforce. There needs to be better understanding between both the sides," Kapur added.

General Motors to source 95 per cent of components locally

FARIDABAD: General Motors said on Tuesday it plans to source about 95 percent of its components from local manufacturers for its newer models.

"The percentage of locally sourced parts and components in new vehicles can be as high as 95 percent," Ashwani Muppasani, vice president, global purchasing and supply chain, General Motors India said at a Federation of Indian Micro and Small and Medium Enterprises (FISME) event here.

According to Muppasani, the company expects the small and medium enterprises (SMEs) suppliers to adhere to the strict global quality and be certified for technical specification (TS certified) which is meant for engineering industries.

The company plans to double its current production capacity from 150,000 units to 300,000 units by 2014 and envisages a big role for small and medium enterprises.

Meanwhile, the SMEs industry raised concerns on the rising number of auto component imports.

"While there is a positive medium-to-long term outlook for demand in the Indian auto sector, there are concerns about rising imports of auto parts and components," a FISME research brief said.

Data furnished by the Automotive Component Manufacturers Association of India ( ACMA) showed that auto component imports grew by 8.5 percent at $30.2 billion in 2010-11.

Skoda Auto India sales up 20% in August at 1,812 units

NEW DELHI: Skoda Auto India on Thursday reported 20 per cent increase in sales to 1,812 units in August this year over the same month last year.

The company had reported sales of 1,512 units in August 2010.

Commenting on the sales performance, Skoda Auto India Board Member, Sales and Marketing, Thomas Kuehl said: "We are extremely positive about Skoda Auto's growth trajectory in India. Our endeavour is to consistently provide consumers with value products and services is one of the key factors contributing to our growth."

The entry level sedan scheduled to launch at the end of the year will also help us reach to a whole new set of audiences, he added.