Panasonic Carbon India Company Limited, in which Japanese major Panasonic Corporation has a majority stake, is expecting a 200 per cent growth in exports in future.
The company’s two major varieties of carbon rods, a component of dry cell batteries, have passed the quality tests conducted by the Panasonic Group factories in Poland, Peru, Costa Rica, Thailand and Indonesia.
The Japanese major has so far been importing carbon rods from its facility in Taiwan for these facilities and the decision to shift sourcing to Chennai is expected to help the Indian firm to benefit from exports, according to a company source. The growth in exports would be achieved according to the projection on demand from the facilities over a period of time.
“As the prices also were found to be competitive compared to Chinese competitors, the company’s export is estimated to grow by more than 200 per cent,” according to the company’s annual report 2011-12.
A trial run to test the feasibility of exports from India has been conducted during the last financial year and the company has recently started container-level exports of carbon rods to these sites, said the company official.
The export sales is around 25 per cent of the total sales of the company. It has posted a net turnover of Rs 20.79 crore for the fiscal year ended March 31, 2012, and the export of goods on a freight-on-board (FOB) basis was around Rs 5.47 crore, which grew 39 per cent as compared to Rs 3.94 crore posted during the previous year.
It has sold around 1,409 million pieces of carbon rods, as against 1,395 million pieces last year. The domestic sales quantity was around 1,138 million pieces, valued at Rs 16.5 crore, which is less than last years' production. Exports posted 65 per cent increase in terms of volume, to 271 million pieces, during 2011-12.
Last fiscal, the company’s profitability was affected by the steep increase in raw material prices and fuel cost, which resulted in the increase in production costs, even though the company continued with cost saving, cost control and value engineering methods, the annual report added.
The company claims to the only firm manufacturing carbon rods in India to cater to the dry cell industry. With the technology changes and more equipment which once used dry cells shifting to other means, the growth in dry cell industry is minimal, said the company official.
Panasonic Carbon’s finished product, carbon rods, is being supplied as a critical component to the Indian dry battery industry, which is projecting a growth of 2-3 per cent in the current year in smaller size batteries.
It may be noted that in June 2012, Panasonic Corporation has acquired 6,02,340 shares in Panasonic Carbon India Limited, which is around 12.55 per cent of the total shares of the listed company, from another promoter, P Dwarakanath Reddy for a total amount of Rs 8.79 crore.
With the off-market transaction, Panasonic Corporation has increased its stake from 50.72 per cent of the total shares of the company to 63.27 per cent, according to a company filing to the Bombay Stock Exchange.