The company plans to increase the revenue contribution from the two segments to 25% in the next three years from 8% at present.
A decade after acquiring Anchor Electricals, Panasonic has finally changed the name of the company to Panasonic Life Solutions India and its brand – Anchor by Panasonic – as well. Vivek Sharma, managing director of Panasonic Life Solutions, told FE’s Vikas Srivastava that the company has now shifted its focus towards B2B and B2G segments as huge opportunities have emerged in areas such as industrial solutions, infrastructure and smart cities. The company plans to increase the revenue contribution from the two segments to 25% in the next three years from 8% at present. Excerpts:
How was FY19 for Panasonic in terms of performance of your switches, wires and cables business?
Though all our businesses were profitable, we focussed on two things. First, in the wiring devices and switch gear segment, we focused on consolidation, while in lightings, indoor air quality (IAQ) and wire & cables segment, we focused on growth as all three were not in the top 5 brands. We were able to meet all our objectives. In FY19, our sales grew 17% on year, while operating profits grew 32%. But, IAQ and lighting segments grew faster than company. So, we are on track to meet the objective of consolidation in the wiring devices and switchgears, and of high growth in the IAQ and wires, lighting and cables business.
Post rebranding and name change from April this year will there be any shift in your focus areas?
We plan to change our focus in big way towards business-to-business (B2B) and business-to-government (B2G) from business-to-consumer (B2C) for two reasons. One, the government has announced housing for all by 2020, which will present huge opportunity in the housing solutions from builders. Besides, there will be demand for industrial solutions such as cooling and internal air quality maintenance solutions as part of B2B business. Similarly, the government of India has become aggressive in setting up infrastructure, such as bullet trains, EESL, electrification infrastructure and setting up of smart cities. So, B2G is also opening up and is a good way to contribute to the progress of the country. Our B2B and B2G contributed around 8% to our total revenues in FY19. We want to take it to 25% in the next three years.
Panasonic plans to set up manufacturing plant in Andhra Pradesh, first in south India. What is the current status? Would you be looking at manufacturing of solar panels in India?
We have already signed the MoU with the Andhra Pradesh government for the space in Sri City. However, we have to decide on the utilisation of space in terms of product mix. Our production at present from the seven plants will meet all our requirements till 2020. We will make a formal announcement in May. As far as manufacturing of solar panels are concerned, more than volumes, consistency in policy is our major concern. If we start manufacturing solar panels today and the safeguard duty stops at a later stage, it will make the plant unviable for us. We are not sure which government will come to power and if the policies will continue. India is full of uncertainties, so we will like to wait and watch for clarity to emerge. At present, we are focussing on rooftop solar business. Despite the premium panels that we are importing from Malaysia, there are customers who are willing to pay for it. Infosys, Ikea, Saint Gobain and Jaguar have got rooftop solutions from us. In total, we have already installed around 1.5 GW of rooftop solutions.
You also want to participate in the smart cities; please elaborate?
Panasonic, globally, has already set up three smart cities in Japan, and another in Denver in US is being set up on ground-up basis. In India, we are participating in the set up of Amravati in Andhra Pradesh. We see strong opportunities in the Delhi-Mumbai industrial corridor where lots of smart cities have been identified by the government. We would like to participate in most of them as and when the government comes up with the tenders.