
Daewoo Electronics re-entered the Indian market after a gap of 18 years in 2023. Managing Director HS Bhatia spoke with Dipak Mondal on the company’s plans for India. Edited excerpts:
Daewoo Electronics has entered India after a gap of 18 years. What made you re-enter India?
When we left India, Daewoo had two verticals – Daewoo Motors, Daewoo Electronics. The auto vertical no longer exists. Daewoo Electronics is alive globally. It is operating in about 110 countries, and now the brand is with POSCO, the Korean steel major. POSCO is among the top five conglomerates of Korea -- LG, Samsung, Hyundai and Kia being the other four.
The reason for making a comeback was the attraction that the Indian market provides you. The economy is growing at 6-6.5%. We believe there will be a lot of money with the people here. And obviously people would like to elevate their living standard.
They would buy a lot of appliances for comfort and convenience, and a better lifestyle. It is the middle 80% of people who are between, let’s say, Rs 12,000- 15,000 per month to Rs 2.5 lakh per month. This is where we are targeting, and this becomes the prime reason we see business opportunities in India.
There are many established players in this space. So, how do you see the competition?
When the market is growing, there is room for everyone. Unlike Europe and the US, where the markets have reached saturation points, India is a growing market. In India, only 72% households have TV, 33% have refrigerators, only 18% own washing machines and 7% have ACs. India offers scope for inorganic growth.
How is Daewoo brand, which is known in India albeit more for Daewoo Motors than electronics, going to help you in establishing in India?
Brand is only a door opener, what you do with the brand is more important. We believe that Koreans, as a country and as a technology, are very well established in India over the last 25-30 years through brands like LG, Samsung, Kia and Hyundai. So, Koreans have a reputation, unlike the Chinese. Koreans are also known for offering value for money propositions. Their technology is as good as that of Japanese, but are always priced lower than Japanese brands.
You plan to launch 270 products. Is there a strategy behind launching so many products?
We have divided our product portfolio into three categories. One is power and energy. Second category is electronics, and the third category is the electric cycle.
Currently, you are manufacturing through contract manufacturers. Do you have plans to set up manufacturing units here?
We need at least 2-2.5 years to set up a plant in India. By then, we would know which products of ours are selling better, and accordingly we will decide what we should manufacture in India. But more importantly, in the last 4-5 years, thanks to Make in India initiative and Production-linked Incentive Scheme, the contract manufacturing ecosystem has taken shape in India.
The PLI scheme also favours large manufacturers, so it makes sense for a contract manufacturer to produce goods for multiple brands and be eligible for the incentives under PLI. Currently, 70% of our products are imported and 30% are manufactured here. In two years, the ratio would reverse.
What is your medium to long-term revenue target from India?
We should achieve Rs 300 crore revenue by 2027 and Rs 500 crore by 2029.