Lg Electronics Bucks Mnc Trend, Eyes Rural Arena

Contrary to the strategy adopted by fellow multinationals, LG Electronics India Pvt Ltd, a 100 per cent subsidiary of Korea-based LG Electronics, is planning to target the rural market in a big way.

Speaking at the launch of CTVs, refrigerators and washing machines in Mumbai, Rajeev Karwal, vice-president (sales and marketing) said 40 per cent of the total sales of colour televisions is expected from the rural market.

The company has priced colour televisions in the range of Rs 10,000-60,000 for sizes ranging from 14 inch to 29 inches. Washing machines are priced from Rs 20,000 - Rs 37,000 and refrigerators from Rs 27,000 to Rs 60,000.

 

KS Raman, president, Consu-mer Electronics and Television Manufacturers Association, said there is tremendous scope for growth in the rural market as it has not yet been exploited.

He said the company's colour televisions and audio systems will have a big market due to their low pricing policy. Apparently, there exists a huge market for refrigerators and washers of low capacity in rural areas. The company's manufacturing unit at Noida in Uttar Pradesh will become fully operational by 1998.

The company will have an installed capacity of 8 lakh colour televisions, 4 lakh refrigerators and 2 lakh washing machines.

For 1998, the company has set a sales target of Rs 100 crore, of which 75 per cent will be from colour television sales, 15 per cent from refrigerators and the remaining 10 per cent from washing machines.

LG Electronics is planning a total investment of $289 million over the next nine years in white goods and brown goods as well as a range of electronic components by 2005.