Videocon takes a giant leap in global retail mkt
Consumer durables major Videocon Industries Ltd is all set to create a strong foothold in international retailing. In an effort to spearhead its retail operations, the company has set up a base of 2,000 retail shops in Germany, Italy, France, Japan, Poland, Vietnam, Dubai, including ‘Videocon’ and ‘Normandie’ branded retail shops apart from multi-branded retail shops, VN Dhoot, chairman, Videocon Industries told FE. Videocon acquired Normandie, a European brand of televisions in 2007, and has charted out plans to sell over one million TVs under this brand in international Markets. Videocon is also creating a cathode ray tubes (CRT) recycling business in the US and Europe. Dhoot said, “In India, we have a base of 40,000 retailers to sell Videocon branded durables and 50% of Indian customers use Videocon products. Since we are into a customer-oriented business, it becomes imperative for us to provide better services to consumers. We will start direct-to-home (DTH) operations in India from September 2008 in full swing. Besides, we also plan to foray into the telecom business as this segment has a great potential in India. It is estimated that by 2015, 70% of the 85 crore people in India will have two to three mobile phones.”
Although Dhoot refused to divulge further details, industry experts said that Videocon will offer set-top boxes at around Rs 1,500 against the average market price of Rs 3,000.
As for the rationale behind the move, Dhoot explains, “This is to improve our topline and bottomline significantly. We feel the real estate market is contributing significantly to the booming Economy and we will set up retail malls wherever we own land. With the move, we hope to grow real estate space significantly in India.”
As for investment required in the telecom business, Dhoot further added that investments worth Rs 8,000 crore is required to start the telecom business and in order to expand the business further, a total investment of Rs 12,000 crore is needed to be infused in the next five years in order to compete in about 22 circles.
Although the DTH television service is at a nascent stage, several corporate houses are planning to tap the segment offering options for consumers who are dissatisfied with the service dished out by cable TV operators.
Videocon takes a giant leap in global retail mkt