The price barrier is now breaking down in the consumer durables segment. After Voltas launched its sub-Rs 10,000 airconditioners, it is now the turn of LG India to announce a refrigerator at the low-priced segment. The company plans to launch a budget line refrigerator, priced below Rs 5,000 this year. Earlier plans to launch the model in the first quarter of 2004 have been shelved due to the price rise in inputs like plastics and steel.
‘‘We hope to launch the product, specially targeted at the semi-urban and rural consumer, in the next three to four months,’’ said LG India managing director Kwang-Ro Kim, on the sidelines of a press conference to launch the Dios TV refrigerator. However, there are no plans to introduce the low-priced range under a separate sub-brand as in the case of CTVs, where LG has a sub-brand ‘Sampoorna’ for the low-end markets. The sub-Rs 5,000 fridge will be in the Direct Cool category and in 150-160 litres.
With this, LG hopes to straddle every segment of the refrigerator market in price bands ranging from less than Rs 5,000 to Rs 4 lakh. Its current range of refrigerators includes 80 models, in sizes from 50 litres to 800 litres, in prices ranging from Rs 7,000 to Rs 2 lakh.
Juxtaposing these plans is LG’s strategy for the upper end, where it is targeting strengthening its digital products portfolio with the launch of a Dios TV refrigerator, which has an in-built 13-inch TV on the door. The 600 litre model is priced at Rs 2 lakh and its launch coincides with the global launch of the product. The company has used the multi-aperture flow cooling technology to control the heat generated by the TV. It also has a built-in FM radio tuner besides cable TV, DVD and VCD connectivity.
LG has set a sales target of 3,000 units for its premium range of Dios fridges this year. The company sold 1,300 units of Dios in 2002, 1,500 the following year and is targeting 3,000 units in 2004. It will also relaunch its Internet Dios model. With the fall in the dollar and customs duties, price of the Net Dios is also expected to come down to Rs 4 lakh.
LG India product group head (refrigerators) Ajay Bajaj said the company also plans to expand its manufacture of refrigerators to models up to 400 litres this year. At present, while models up to 310 litres are manufactured at its Noida facility, all other sizes are imported. Once the Pune facility becomes operational this year, manufacture of fridges will be shifted there. The company has invested an additional Rs 100 crore in the Pune facility till July this year. The company is targeting sales of 1.5 million refrigerators this year.
The company, which clocked a turnover of Rs 4,500 crore in 2003, is targeting Rs 7,000 crore this year.
Mr Kim once again ruled out the possibility of the company going public this year. ‘‘Sometime in the future, but not in 2004,’’ he said in reply to a query.