Voltas - India

8/8/2019 Voltas - India

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VISION

yTo achieve over Rs 1600 Crores turnover by

2010-11.yBe EVA-Positive.

yBe a Profitable Air Conditioner brand.

yBe a market leader in Water Coolers &Commercial Refrigeration products.


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MISSION & VALUES

yTo be a passionately Customer focused

Organization providing innovative products

and services and exceeding all stakeholders

expectations.

yValues:

yPassionate customer focus.

yAgility

y Innovative cost consciousness.

yDisciplined teamwork.


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INNOVATIVE FIRSTS

y Manufactured the first ever room air conditioner in 1954.

y Set up the first integrated plant in 1969.

y Introduced the first innovative split air conditioner in 1984.

y

Introduced the tall and elegant slim line air conditioner in1993.

y Introduced micro-processor based packaged unit in 1998.

y First to introduce water dispensers with mini fridge.

y Launched the 55 litre refrigerator.y Among the first to launch sub 1.0 Ton ACs.

y Introduced Energy Efficient Air-Conditioners in 2007.

y First to introduce corner split AC in 2008.


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INTRODUCTION

ySet up in 1954 as a joint venture b/w M/s

Volkart Brothers & Tata Sons Ltd.y In 1956 the co. went public.

yTill 1961 Voltas acted as an Indenting agent.

y In 1963 first factory was setup atChinchpokli.

y In 1964 another plant was setup at Thane.


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CONTD...

yExtension in range of products b/w 1964 to

1977.

y In 1978 VIL, a wholly subsidiary of Voltas was

setup.

ySetup of another unit at Warora, near Nagpur.

yTie Ups with Dunham Bush Inc., and Standard

Refrigeration co., USA & Hitachi, Japan.

yExtensive diversification by 1990s.


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DIVERSIFICATION FIELDS

Food &Beverages

For lift

Tr c s

Chemicals&

Pesticides

Engineering Services

Refrigeration

AirConditione

r


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CONTD...

yThe acquisition of the loss making HyderabadAllwyn Ltd.

yRising expectations & falling demand during1990s.

yVoltas suffered first ever loss of Rs. 170Million in 1996-97.

yResignation ofMr. V.H. Munshi & takeover byMr. Nawshir Khurody asMD.

yRestructuring, Turnaround & The Big Bang.


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RESTRUCTURING

y Formation of Core Team

y Sold out After Analysis (Market Size, Growth Potential ,Strength

of competition )

y Core Competencies (Only A/C)

y Cash Flow Requirement From real estate

y Sold Out:

y Refrigerator BU and Allwyn Brand Sold to Electrolux

y Agro Chemical Unit to Rallis India

y Switchgear, Perfect moulds, Granites


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CONTD...

y International O/p

y Air Conditioning

y Refrigeration

y Unitary Cooling product

y Employee Cost

y Shift in offices

y Future Avenues


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INTERNATIONAL OPERATION

(ELECTROMECHANICAL)

y Target: Mechanical Work, Heating and ventilation and cooling,

Public health System , Firefighting, Security, Specialized Lighting,

M

edical Gases, Integrated Building management System,Communication

y Formation of JV for NewMarkets

y 2001 @ VILMerged with Voltas

y Selection of project

y Queen Mary II ,The Bahrain International Airport, Abu Dhabi Mall

in UAE


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PRODUCT LINE

yRevamped entire Product line

y Joint Venture with FEDDERS

INTERNATIONAL.

Universal Comfort Products Private Limited

yManufacturing facility at Dadra


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BENEFITS FROM FEDDERS

yExpertise inManufacturing, Product

development and Design.

yR&D from US and Singapore.

yAccess to Global Supplier Network

yM

ade VoltasLow

est-co

st manufa

ctu

re

rs


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VoltasVertis

Voltas Vectra&

Voltas

Verdant

Voltas Vertis0.6 ton

Voltas Vertis

Gold &Deluxe

RETAIL ACMARKET


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LINK UP WITH UNIFLAIR

y Italian AC major.

ySpecialized in design, production & air cooling

solutions

yDistribute and service Uniflair products in

India.


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INSTITUTIONAL ACMARKET

yTelecom and Banking segments

yVenture: Corporate Segment

yVisionaire: Government Segment

ySensicool: Telecom, IT, Pharma and Banking

Segment


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BRAND BUILDING

y It was Staidand Outdated

yRs.500 million

Year 2001 2002 2003 2004 2005 2006

Ad Spend 80 200 180 170 170 200


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ADVERTISING STRATEGIES

yTargeted Young People

y2003

OutdoorMediaSpecial Voltas Carnival Offers

Tie ups with HSBC & Westside

AC with IQ

y2004

Ab Har Koi Le Sake AC KaMaza


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CHANNEL & SERVICE

y 2001

Retail Network with Exclusive Dealers

y2002-03

Spent 10Million on Training Channel Partners

Set Up Voltas Domes

Relationships with Architects & Interior Designers

Set up Call Centers

y CRYSTAL CARE SERVICE

y Several Products Were Introduce inMiddle East


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CONTD...

y Improve Performance in

Sales & Distribution

Accounting

Customer Service

y 2004

1400Multi-Brand Outlets

450 sales& service dealers


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RISE TO THE TOP

y Big Bang strategy was a success

(* E Expected )

Year 2001 2002 2003 2004 2005 2006

Market Share 6.8% 9.7% 11% 12% 16% 20% (E)*

Rank 7 2 2 2 2 2


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y In 2005 Voltas continued to make inroads into the

retail AC market .

y InMarch 2006, Voltas launched Vertis Premium

y In 2006-2007 company aimed to increase its

market share and took separate marketing initiative

y Aggressive ad campaign -

India Ka Dil,India Ka AC, Korea Ka Nahi


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MARKET SHARE OF ALL THE

PLAYERS IN THE INDUSTRY

Market Share (2005)

Voltas (16%)

LG(33%)

Samsung(13%)

Others(38%)


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yNew manufacturing plant launched in

Uttaranchal in 2006

yJoint venture facility at Dadra was shiftedat new plant i.e. AC unit.

yReasons behind this move

- Cost saving of 5-6%- Increased production capacity


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y Biggest competitors LG

and Samsung had- Largest distribution

network for consumer

durables

- Wide product range

- Efforts to improve rural

distribution market

y Entry of new players like

Godrej, Koryo etc.


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RETAIL REFRIGERATOR BUSINESS A DRAIN ON

RESOURCES

y This business accounted for most of the divisions

losses

y In 2000 Voltas signed an agreement with LG to

supply 1.2 million refrigerators over the next three

years.

y Voltas also manufactured refrigerators for

Samsung, Haier and also supplied refrigerator partsto local manufactures

y End of the contract with LG and Samsung in 2004

yNon compete agreement with Electrolux.


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y Voltas planned to re-enter

refrigerator market in 2004 and

even launched some models ofrefrigerator

- Coldcel

- Teenie Weenie- Xcel

y In 2005 Voltas dropped its plan

to enter the refrigerator market

and closed some of its unitsy In 2006, it announced plans to

produce commercial

refrigeration segment.


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VOLTAS ON EXPANSION MODE

y As of early 2006 Voltas was expecting to grow in

all its businesses.

y Research centre development

y Voltas was expecting increase in the demand for

commercial refrigerators with certain amendments

to APMC act

y Construction business in middle encouraged

Voltass electromechanical business.


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VOLTAS ENTRY INTO WATER

TREATMENT

yVoltas planned to acquire new

technology- Water treatment

- Purifying

- Recycling- Desalination


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ANALYSIS

y Threat of rivalry in consumer electronic market is

very high

y

Need to keep track of competitors movey Intense Price rivalry

y Voltas needs to focus on its AC business

yNeed to establish innovative service centers

catering to retail AC segment

y Growth comes with uniqueness and Voltas needs to

find that

Voltas - India

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