Gemini Traze to produce active RFID tags

Chennai-based Gemini Traze, the only manufacturer of radio frequency identification (RFID) tags in India, plans to manufacture active RFID chips.

The company will be investing close to Rs 3.5-4 crore to roll out active RFID platforms. The product rollout should happen by the end of this calendar year.

A few months ago, the company, a 100 per cent subsidiary of Gemini Communications, had set up its manufacturing plant for passive RFID tags with a capacity of 100 million annually.

Pradhyumna Venkat, CEO, Gemini Traze, said: "We want to break the price barrier that this technology has. Currently, an active RFID tag costs around $20 (Rs 800) we want to bring it to $10-8 (Rs 400-300)."

An RFID tag is an object that can be stuck on or incorporated into a product, animal, or person for the purpose of identification using radiowaves.

The company already has a few pilot projects running with active RFID tags. Some of them could also become potential projects in the future. Venkat believes that active tags have a huge potential in areas such as container tagging, asset management etc.

"We are looking at revenues of Rs 5-10 crore in the first year of production from active RFID tags alone. Moving ahead we would like to have a sale of one million active tags a year," remarks Venkat.

Active RFID chips have a market share of $300-400 million (Rs 1,200-1,600 crore) worldwide. The estimated market size of RFID industry in India is anywhere between Rs 125-150 crore (Rs 1.25-1.50 billion) and is said to be growing at 30 per cent per annum.

While the manufacturing unit started operations just about six months back, it has already sold (exported) more than 14 million passive RFID tags.

"We are running on a capacity of 30-35 per cent. By the end of this year we have a target to increase the capacity by 40-50 per cent," said Venkat.

The company has also been able to reduce the price of passive tags to Rs 10 from Rs 35-40 in volume deployments.

"Immediately after the plant started operations we received about 20 pilot orders. This was precisely because of the fact that we have a local market presence. In the new pilot stage we are again giving tags for as low as Rs 15-18," adds Venkat.

However, for Venkat the onus right now is to get a continuous flow of orders. "We want to have long term commitment from our customers. That will give us continuous volumes," he adds.

To increase the penetration in India, the company is planning to increase its partner strength.

By the end of October they hope to increase these numbers to 200-250 from the current 90 partners.

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WHAT ARE RADIO TAGS?

Active tags have their own batteries, hence have a limited shelf-life and are expensive too.

Unlike passive tags, they do not require readers and antennae to transmit the details of the card.

Active tags, due to their onboard power supply, also transmit at higher power levels than passive tags.