Tvs Electronics Picks 33% Stake In Modular Systems

TVS Electronics, the Chennai-based computer peripherals manufacturer of the TVS group, has picked a 33 per cent equity stake in the Pune-based Modular Systems, a leading Indian language-based company, for a price tag of Rs 2.25 crore.

Modular Systems has been valued at Rs 7.5 crore. The three promoters of Modular Systems: Mehemosh Cooper, Raghunandan Joshi and Meena Joshi will hold the balance 67 per cent equity stake in the company. Subsequent to picking up of the equity stake by TVS Electronics, the name of the city-based company has been changed to Modular Infotech.

"It is our strategic investment to develop language enabled products. Our emphasis in this new venture with the Pune firm will be on software, consulting and services," Gopal Srinivasan, director of TVS Electronics said.

 

Modular plays a significant role in the language market segment and has a range of products that are widely used for desk top publishing in Indian languages. Its Indian language product "Shree-Lipi" is widely used. Srinivasan sees tremendous business opportunities from the current Internet explosion as a major part of the Indian population will seek Indian language computing.

"All the products of TVS Electronics are going to be language enabled and the tie-up with Modular will help us a lot," Srinivasan said.

"The tie-up with TVS Electronics will enable us to fulfill our urge to grow and get into a wider canvas of the IT world," Raghunandan Joshi said.

Although Modular has good products base having established its business for over 15 years with over 2,100 Indian language fonts (type styles) which are copyrighted, the company was perceived to be more of a technocrats promoted company lacking marketing and business orientation. Following the tie-up with TVS group company, TVS Electronics will undertake marketing and business development for Modular Infotech's products.

TVS Electronics is already in the process of developing "Keyboard Appliance" which does away with the main box of the computer which houses the mother board and other gadgets as all the essential components will be fixed in to the keyboard itself, including the floppy drive. Keyboard Appliance will be targeted at cyber cafes where computers are required mainly for surfing and at other enterprises where computers are used for data entry.

The Keyboard appliances will be manufactured at the TVS' manufacturing facility at Tumkur in Karnataka. TVS Electronics also has a facility in Chennai. Also on the launch pad is "Retail Automation System" which has applications in billing and in retail automation.

TVS Electronics spends around 3.5 per cent of its sales turnover on research and development.