Monday January 5, 02:55 AM

Source: Indian Express Finance

Niche segments see growth amidst slowdown

By Mona Mehta
Although the manufacturing segment is feeling the heat of financial meltdown, companies providing niche services like lighting and interior design are still seeing growth and are planning fresh investments and foray into lucrative business areas. For instance, with energy efficient lighting solutions market witnessing 30% growth in the year 2008, lighting majors are charting out new investment plans to launch new lighting solutions, adding more capacities apart from increasing distribution reach in order to meet the growing demand in the 2009. Meanwhile, more players are entering another niche segment, like the Rs 1,500 crore modular kitchen segment, which is seeing a growth of 40% with the increasing number of nuclear families, rising disposable incomes, affordability, and easy budget. Following the strategy of setting up the global development centre in India in Noida in August 2008, Philips Lighting is now looking at continuing investments in introducing new lighting solutions that cater to the lifestyle aspirations of people apart from creating awareness around energy efficiency in the year 2009, Murali Sivaraman, CEO, Philips Electronics India told FE. According to him, Around 40% of the Philips revenues comes from the lighting business comprising lamps, luminaire, lighting electronics, automotive and special lighting. Sivaraman said, One of the primary research areas for the centre will be to develop products that take care of high voltage fluctuations in India. High levels of voltage fluctuation are frequent in India and leads to a shorter life span of lamps. One of the efforts of the centre will be to develop products that can adapt to such voltage changes. The centre currently employs 35 engineers and the headcount will increase with the unit taking up more work. Going forward, Philips Consumer Lifestyle will continue its focus on health and well-being, and keep introducing lifestyle enhancing solutions for people that really matter to their lives, he added. Bajaj (BAJAJAUTO.NS : 2101.05 0) Lighting is investing in increasing capacities of Starlite Lighting from 10 mn per annum to 40 mn per annum in 2009. R Ramakrishnan, president and COO, Bajaj Electricals Ltd said, In 2009, we will be increasing distribution network for energy efficient products from 2.50 lakh retailers to 3.50 lakh retailers. While the CFL market grew at 30%, we continued to grow at 70% in 2008 and we hope to look at welcoming 2009 with a positive feeling. Meanwhile, HandR Johnson, a leading tile manufacturer, has decided to foray into the branded modular kitchens market and plans to launch a new kitchens division as well. Vijay Aggarwal, managing director, HandR Johnson told FE, The products shall be branded as Johnson Kitchens targeted at upper market (Rs 3 lakh and Rs 10 lakh) and value-conscious (Rs 75,000 and Rs 3 lakh) segments. We have recently started working on projects with many reputed builders in Mumbai and Goa. We have already bagged orders from Lokhandwala and Mantri Builders in Mumbai and for 66 Villas in Goa. We hope to become Rs 500 crore division in the next five years. Aggarwal added that targeted at upper market segments, the premium range is sourced from Europe whereas the value one is towards the value-conscious segment. These two different collections will enable us to cater to the entire market. The brand enjoys a strong positioning in the minds of the consumer from being an end-to-end company in tiling and bathroom solutions.