Mirc Electronics has bagged a major order to make television sets for the Mukesh Ambani-owned Reliance Retail.
As part of its effort to step up non-captive manufacturing, the company is also in talks with three Chinese companies to manufacture television sets for their clients in India.
Hike in duty
The demand for third-party TV manufacturing is driven by the government’s ‘Make in India’ initiative, as part of which the duty on TV imports was doubled to 20 per cent and the duty on panels was hiked to 15 percent from 5 percent.
Mirc Electronics has manufacturing facilities at Wada (Maharashtra) and Roorkee (Uttarakhand) with a capacity to make over 3.4 million televisions and 2.4 lakh washing machines.
Upbeat on LED panels
Vijay Mansukhani, Managing Director, Mirc Electronics, told that the company is currently manufacturing 80 percent of television LED panels required for captive purpose to reduce cost and have an edge over other brands.
Once the LED panel manufacturing stabilizes, he said the company will start producing for non-captive purpose as there is a big demand for it after the hike in import duty.
“We need an absolutely dust-free environment to make LED panels,” he added.
On non-captive TV manufacturing, he said getting approval from the Bureau of Indian Standard takes a lot of time, but once the clearance is in place, it increases the stickiness of the business as the client has to take the approval again if it were to switch the manufacturing contract to another company.
Mirc Electronics is expecting revenue of Rs. 150 crore from non-captive TV manufacturing next year.
The GST boost
Though the cut in GST on small TVs to 18 percent from 24 percent is a relief, a similar move on TVs with larger screen would boost demand, he said.
Mirc Electronics is also firming up strategy to deliver quality after-sales services for all its white goods and later extend it for non-captive clients.
With the rollout of the GST, the company has managed to send goods from Maharashtra to Kolkata in one day against the travel time of four days in the earlier regime, said Mansukhani. ― The Hindu Business Line