Hotline and Haier group had entered into an agreement to form a 70:30 joint venture late last month to manufacture and market a range of home appliances and brown goods, even as speculation about the break-down in Hotline-Konka relations were doing rounds.

Hotline finally announced its withdrawal from the joint venture with Konka group on August 10. A confirmation of breakdown of relationship is still awaited from Konka.

Hotline sources said that the joint venture company Hotline Haier Appliances Ltd would launch a range of as many as 60-70 models of various products straddling various price points and market segments before December this year simultaneously across the country. A manufacturing facility at Noida is expected to be ready for commercialproduction by April 2000, these sources said.

Hotline sources added that it has already moved an application before the Foreign Investment Promotion Board seeking approval for the joint venture.These sources said that the joint venture company would be set up with an equity base of Rs 50 crore. Another Rs 100 crore would be raised as term loans from financial institutions to fund the project cost in the first year.

Hotline Haier Appliance will have a 10-member board in which Hotline will have seven nominees, and Hotline managing director Anil Gupta is expected to be in the driver's seat. In the second year of operation, a further amount of Rs 150 crore is expected to be invested to expand the facility. Hotline Haier Appliances plans to manufacture a range of white goods such as refrigerators, washing machines, airconditioners, deep freezers,dehumidifiers, air purifiers vacuum cleaners and microwave ovens.

``We will initially launch imported products, but once our manufacturing facility is ready, we willassemble the products from completely knocked down kits for sometime and then indigenise them,'' Hotline source said. The joint venture company plans to achieve 70-80 per cent level of localisation once the manufacturing stabilises.

The foray into the colour televisions market is planned for the second phase of operations as the joint venture felt that the CTV market was too competitive at this stage while entry into the white goods market was easier.These sources added the joint venture company has already acquired about 30 acres of land for Rs 8 crore at Noida. ``Development work will begin soon,'' sources said. ``We are going ahead with our plans very aggressively. Hotline is a very aggressive company, and this will be reflected in the rollout of Haier products here.''

Haier is the second Chinese company to enter the Indian consumer goods market. The group is one of the largest white goods manufacturer in China.