Indian conglomerate to make appliances for Japanese brands Sansui, Nakamichi
By Atul Ranjan
NEW DELHI, NNA – Indian conglomerate Jaina Group plans to invest at least 10 billion rupees ($140 million) over three years to make Japanese-brand appliances for domestic and overseas markets, its senior executive said.
The New Delhi-headquartered industrial conglomerate will manufacture for Southeast Asia and other regions, the group’s Managing Director Pradeep Jain told NNA in a one-on-one interview on Oct. 9.
The group recently acquired a license to make consumer electronics for the Sansui and Nakamichi brands. It got that license from the Hong Kong-based Nimble Group.
The Indian conglomerate will set up a 30-acre plant either in Gurugram in the northern Indian state of Haryana or in Noida in the northern state of Uttar Pradesh, Jain said. A first phase will open by early next year.
Jaina Group already has a total of 300 acres between these two locations, an asset that will help get the factory operating, the managing director said.
The planned factory would make television panels, washing machines, refrigerators and air-conditioners under the Sansui brand. It would produce audio and TV gear under the Nakamichi brand. It is eyeing possible production of capacity of 1 million TV panels and 600,000 washing machines including some with the Sansui brand in its first year, Jain said. It would start making Nakamichi early next year.
The group that also makes telecom gear hopes to take advantage of the Indian government’s recent offer of tax benefits covering new factories, Jain said. The government has cut corporate taxes to make the country attractive for manufacturing.
“With the country now offering comparatively low tax rate and cheap labor costs, it makes sense to manufacture locally,” Jain said. “We are looking forward to making India a global manufacturing hub for brands such as Sansui.”
Last month the Ministry of Finance announced that new manufacturing companies that incorporate after Oct. 1, 2019 and start production before March 2023 will have an option to pay tax at a lower rate of 15 percent compared to the previous 25 percent.
The factory will draw on “localized R&D solutions based on in-depth consumer research in the country”, said Lim Jew Tim, head of Sansui’s global licensing, in a statement.
The Indian group, which acquired the brand rights in August 2018 for the Indian and Southeast Asian markets, expects “strong brand recall that Japanese brands like Sansui still enjoy” to drive demand in India, Jain said. The group is also looking for a boost from its competitive pricing strategy online and offline.
Jain said his group will make Sansui products available through over 6,000 retail partners and online partners including Flipkart.com., a major Indian online marketplace.
India’s consumer durable goods sector logged a 16.3 percent compound annual growth rate from fiscal 2012 and fiscal 2017 to surpass 1 trillion rupees, due to a trend of urbanization, ratings agency CARE Ratings Ltd. found last year.