Consumer electronics major Philips Electronics India Ltd is planning to intensify its presence in smaller towns and rural areas over the next five years.
According to Rajeev Chopra, Vice-Chairman and Managing Director, Philips’ strategy would be to push sales of its three core businesses — lighting, consumer lifestyle that includes electronics goods and healthcare .
“We plan to intensify our distribution networks (in smaller towns). But it will take around 5 years for us to do so,” Chopra said after the company’s annual general meeting here in the city.
Standalone stores
Philips would, however, not follow a differentiated pricing strategy in the lower rung markets. He also ruled out the immediate possibility of standalone stores.
Lighting, at present , accounts for nearly 58 per cent of the company’s turnover, while healthcare and consumer lifestyle segments contribute over 18 and 15 per cent to its top-line. The company recently moved from a calendar year to financial year for accounting purposes. Unaudited results for 12-months ending March 31 saw Philips reporting a gross income of nearly Rs 4,728 crore and a net profit of Rs 91 crore. According to Chopra, Philips will continue with the Preethi-branded kitchen appliances in South Indian markets.
For other Indian markets, appliances will be sold under the ‘Philips’ brand name.
Acquired by Philips in April 2011 from Maya Appliances Private Ltd and other group companies, ‘Preethi’ with its range of mixer grinders, induction ovens, irons and electric cookers, among others, is a market leader in the southern markets.
“For South Indian markets we have kept the ‘Preethi’ brand intact. Elsewhere we are, however, using the Philips brand,” he said.
The acquisition, Chopra said, would help Philips to leverage ‘Preethi’s’ strong distribution networks.