The Indian arm of Philips, the 25-billion euro Dutch electronics maker, has made strides in the critical care space with a new brand of baby warmers and incubators developed by its R&D centre in Bangalore. In an interview with FE?s Ajay Sukumaran, Rajeev Chopra, managing director and CEO, Philips Electronics India, says the company?s focus is on maintaining its lead in large business segments while ramping up presence in new areas such as decorative home lighting and personal care.
How did your businesses do in the last fiscal?
I think we made substantial progress in each one of our objectives. In lighting, we had four key objectives. The first was to lead the transformation into LEDs, grow the new business of decorative lighting we had launched three years back, move into rural India and also to get into new areas such as lighting controls and solar. As far as consumer lifestyle is concerned, there were a few things. First, we have divested the audio/video and multimedia business to (Japanese firm) Funai. The legal Indian process for divestment is in progress. We recently had our shareholders? meeting to approve this. If things go according to plan, by the end of this year it will probably go to Funai.
The second part was to further grow the kitchen appliances business and between our two brands, Preethi (the Chennai-based company which it bought in 2011) and Philips, we are number one. It has been a story of products as many new products came out last year. Again, in personal care, we have made significant progress and, in healthcare, we believe we are number one right now. By and large, I think we have made decent progress.
What is your biggest vertical in terms of size?
Lighting is roughly about half the company and the other two are about a quarter each.
Have you made any inroads into small towns and rural India over the previous year?
We have reached some milestones. We were already present in small towns. We have now expanded our footprint and started to get into rural areas. Rural is not something that can be achieved in one year. My guess is, if we were to establish the kind of footprint in rural areas the way we have done in urban India, it will take us at least 5-10 years.
What?s your plan for acquisitions?
We have made three acquisitions in the last five years. So, should something interesting come up in the future, we will definitely take a look at it. But if you ask me if there?s anything on the table right now, the answer is no.
What would be your targets across businesses over the next couple of years?
We hope to maintain our leadership position and would like to further strengthen in the big categories. We would also like to do a little more on those that would be long-dated in the future, such as decorative home lighting and personal care.
We will put in disproportionate effort to try and build those categories that may not be very big today, but have the potential. If you look at the number of apartments coming up, new homes being built and people getting affluent, the trend is right along with us.