Glut of cheap products from Kodak hammers prices by 60%

Vijay Trivedi

Mumbai, Jan 6: Kodak India Ltd (KIL), the Indian arm of the USA-based world’s leading suppliers of colour photographic rolls and papers, is being alleged to have resorted to massive supplies of cheap products in the country, leading to overall decline of around 62 per cent in prices of roll films in the country. This, traders say was during 2001 which saw the overall market of photographic goods grow by around 45 per cent from previous year.

Indian photographic market is growing at seven per cent annually, having the burn rate (clicking of each frame) of 0.09 roll films. In domestic market the films rolls sale is 90 million and the estimated value of the entire industry is about Rs 2,500 crores, including film processing and printing.

The activities of KIL is alleged to have almost killed the businesses of other main photographic goods suppliers like Konica India, Fuji, Mitshubishi all of Japan’s leading suppliers of photo goods. The UK-based Afga too is said to have been hit seriously by such activities, traders said.

Accordingly, the group of domestic photographic goods suppliers in industry have recently submitted application to the Commerce Ministry for leavy of anti-dumping duty on the Kodak color rolls and other related products.

According to All India Photographich Trade & Industry Association (AIPTIA), president Mr Dinesh Shah, industry is ‘really’ facing tough competition from the MNC company and due to cut-throught price competition in the local market other players in the same field have to shut down their business in soon time.

Further photographic trader say, oversupply of color film rolls in the domestic market has pushed down its prices. Current international market price of color roll is being quoted at $4.5 per roll, whereas the Kodak India sells the same in the local market at around $1.70 per roll. This is around 62 per cent cheaper than international price.

Speaking to The Financial Express, KIL, Managing Director, RS Mani said: "Allegation against our company is totally incorrect. Our company is selling in the local market at par with the international price."

"But it seems that by looking at our market size increasing in last two years, our competitors have started faulty propaganda to damage the our brand." Mr Mani added very firmly.

Traders allege that, basically, the current market strategy of Kodak India is to "wipe-off its competitors" in the domestic market. This has hampered the activities of distributors handling products of competitors.

In India there are major seven players in the color roll films of which KIL is the leader. Others include Fuji Photo Films, Konica Corpo., Agfa, Jindal Photo Films, PHIL Corporation and Mitsubishi.

In fact, the domestic industry relies heavily on imports and all domestic companies import packed roll papers, color films, motion picture films, and other raw materials from China, USA, Australia, Japan and Europe.

Hence, local companies mainly are distributors of their collaborators. KIL has technical and financial collaboration with Eastman Kodak of USA, whereas Phil has technical collaboration with Konica Corp and Goko Camara of Japan. Jindal photo has technical collaboration with Fuji of Japan. Other has marginal presence in the local market, with collaboration of their parents companies.

At present, the local industry is facing tough competition from KIL. Traders allege that, KIL gets all the material directly from its parent company with very low price. This is the reasons that, despite high import duty of 51.2 per cent on color roll, KIL is able to sell the same at very low price.

Traders say: "Not only Kodak has increased its market in domestic front but it has outpriced other local manufacturers. This will force us to shut down our operations" lament leading distributors.

Whereas, local distributor of Konica color films, Computer Graphics, Director, R N Pardiwala says: "By following this indirect path to widen the market size in the local market, KIL has indulged in unfair competition".

Meanwhile, AIPTIA has organised five day exhibition ‘Photofair 2002’ and seminars in Mumbai from January 10-14, 2002. This exhibition will showcase state of the art technology and products from various national and multinational companies like Kodak, Phil Corporation, Canon, Nikon, Konica, Fuji, Sony and Jindal among the others.