Consumer Electronics Units Shorted In June Quarter
Consumer electronics companies faced rough weather during the quarter ended June 30, 2001, as sales tumbled and profits dwindled. However, even while the majority of listed firms languished, the privately-held firms increased their sales if not their profitability over the corresponding period last year.
Among the market leaders, only Videocon International showed a marginal improvement (3.9 per cent) in sales from Rs 724.16 crore in the April-June quarter to Rs 752.27 crore over the corresponding period this fiscal. Arch-rival BPL registered a 19 per cent drop in sales from Rs 388.5 crore in the first quarter of the last financial year to Rs 314.84 crore this year.
Mirc Electronics Ltd, which manufacturers the Onida brand of televisions, also reported a 1.8 per cent decline in sales turnover during the first quarter from Rs 127.12 crore in 2000-01 to Rs 124.83 crore this year. Mirc said that sales of TVs are of seasonal nature and bulk of the despatches take place during the later part of the year. "Hence, the first-quarter peformance is not representative of the full year's performance," it said.
Philips India Ltd, which is planning a delisting since its Dutch parent intends to increase its shareholding to 100 per cent, has also shown a marginal decline in sales turnover for the quarter to Rs 360.96 crore.
The New Delhi-based domestic manufacturer Salora International, a major in black-and-white televisions, has registered a decline in sales from Rs 49.05 crore in April-June 2000-01 to Rs 46.04 crore during the same period in the current financial year.
Salora has, however, admitted that though demand is showing signs of improvement. However since competition is increasing, margins are expected to remain under pressure.
Salora's net profit for the April-June quarter fell a massive 99 per cent from Rs 19.61 crore to Rs 2.12 lakh in the corresponding period last year. Mirc Electronics also reported a 42.29 per cent decline in net profit from Rs 4.28 crore in April-June 2000-01 to Rs 2.47 crore in the same period this financial year.
The first quarter net profit of BPL Ltd has declined 46.15 per cent from Rs 18.96 crore in 2000-01 to Rs 10.21 crore in 2001-02. Philips continued to post losses in the first quarter of the year. Net loss increased by 150.14 per cent from Rs 3.49 crore in the quarter ended June 30, 2000 to Rs 8.73 crore in the same quarter this year.
And competition is coming from the likes of Samsung and LG, both of which are still privately held. LG Electronics India has plans to hit the market with an initial public offer this year. But it has already postponed the issue several times citing unfavourable market conditions.
A company official said during the quarter (second quarter since it follows the calendar year), it registered a sales turnover of Rs 609.96 crore against Rs 546.6 crore registered during the same period last year. This resembles a healthy improvement of 11.6 per cent, but includes revenues from the same of IT and telecom products. The company, however, declined to part with its profit figures for the period.
Samsung India Electronics Ltd also reported a 14 per cent growth in sales for the April-June quarter this year against the same period last year. It achieved a sales turnover of Rs 640.2 crore (from consumer electronics) during the first six months of the year -- a growth of 16.4 per cent. Profit figures were not available. A company spokesperson said that there are signs of improvement in retail movement and the rest of the year will be much better.