The Indian CE, HA, and AC market is at a point where it must look beyond the business-as-usual growth of approximately 10 percent. 2017 seems to have set the wheels in motion.
There was activity on the M&A front. Havells India exited an overseas investment and acquired Lloyd. Blue Star entered the water and air purifiers, and air coolers businesses. Voltas formed a venture to launch refrigerators, washing machines, microwaves, and other white goods, early 2018. Sharp entered into a strategic alliance with Ingram Micro to distribute its air purifiers and announced a comeback with manufacturing in India at its Foxconn plants. Everstone entered into an exclusivity agreement with Videocon and submitted a Rs. 1300 crore bid for Kenstar.
Chinese investors were seen stealthily pouring money into India. Mobile phone manufacturers, Xiaomi, Oppo, and Vivo with high-specification products, at lower prices outperformed Indian players, Micromax, Lava, and Karbonn. Tencent Holdings Ltd. ploughed Rs. 4820 crore (USD 700 million) into Flipkart. Display panel maker, BOE Technology forayed into the Indian market.
With the implementation of GST in full swing, both the industry and trade are heavily batting for an 18 percent slab and 12 percent in the case of energy efficiency models, that is, if the merger of 12 percent and 18 percent tax slabs into one does not happen.
On the policy front, the revised National Policy on Electronics, to be finalized by March 2018, is eagerly awaited. India is on the path to becoming a hi-tech manufacturing hub of electronic products. A Rs. 745 crore budgetary provision toward incentive schemes like M-SIPS and EDF; 100 percent FDI in the consumer electronics and home appliances manufacturing sector through the automatic route; 51 percent of FDI in multibrand retail and electrification of 100 percent of the country by 2019 are all steps in the same direction. Challenges as low cumulative domestic value addition, higher cost of finance and power, inefficient infrastructure among others will need to be overcome.
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