Samsung To Set Up $20-Million Plant In Noida

Samsung India Electronics Ltd is investing $15 -20 million in a white goods facility in Noida near New Delhi. Expected to be operational by the second half of 1998, the plant will have an installed capacity of 2,00,000 refrigerators and 1,00,000 washing machines a year.

Once the plant becomes operational, the company will make refrigerators with a capacity range from 200 litres. At present, Samsung enjoys a 40 per cent marketshare in the over 300 litres segment (these are now being brought in from Korea as completely built units- CBU). The 600 litre plus segment accounts for only two per cent of the entire market for refrigerators in the country.

 

The company is also planning atleast two other such white goods facilities in other parts of the country.

Company officials, who were in the city to launch their latest, patented range of refrigerators and colour televisions in the country, however, were tight-lipped about the investment and/or the products that would roll out of these plants.

"It will depend on the way demand for the products pick up in the future," a senior official said.

In 1996, the company reported a turnover of Rs.156 crore, and officials hope that the turnover will touch Rs.400 crore in the current financial year.

By the turn of the century, Samsung will also be making its range of audio systems, room airconditioners and microwave ovens in the country.

This will form the second phase of the company's presence in the home appliances market.

Investments in these ventures are independent of the $630 million the Korean major plans to bring into the country through its holding company, Samsung Electronics India (Pvt.) Ltd. The holding company will begin operations from October this year.

"India is seen as among the top three emerging markets in the world, and we will be making our presence felt through products like colour televisions, washing machines and refrigerators which will enjoy high visibility," says B.M.Park, managing director, Samsung India Electronics Ltd.

The new businesses, investment for which will come in via the holding company, include two units, Samsung Display Devices and Samsung Electro Mechanics, to make colour picture tubes, colour monitors and other components that go into the manufacture of white goods.

Meanwhile, the holding company will directly launch office automation products like faxes, EPABXs and monitors by September/October this year. To begin with, assembled units will be sold here although Samsung will "eventually make even these products within the country," says another top official.

For its foray into telecom, the company is setting up a 50:50 joint venture with L&T for switching systems. The paid up capital in this venture will be $10 million while the authorised capital is $44 million.

The Samsung Software India operations is another $5 million facility set up in Bangalore for software development.

According to the brokers the Sebi team had promised them of lenient view if they agreed in writing of their involvement in carryforward trading. However, the Sebi officials went against this assurance later, the brokers said.

Besides the PSE brokers, some upcountry brokers have also been charged on similar grounds. The hearing of cases conducted in Mumbai was chaired by the Sebi chief D R Mehta. The PSE brokers were recently invited to Mumbai by the watchdog to give their say on the show cause notices.

Several brokers have given their defence in writing to the Sebi chief, while some have preferred to accept the charges levelled against them.

Some brokers have pleaded that suspension periods are too harsh and it should be reduced. While others have challenged the Sebi showcause notice and the charges levelled against them and told the Sebi chief that allegations against them, particularly of pulling down the BSE Sensex were baseless as they have no control over the Sensex since they trade on the PSE.