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LG plans to consolidate its India operations

21-December-2002
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LG plans to consolidate its India operations

Chaebol LG is planning to consolidate its Indian operations by integrating its sales and marketing and distribution of three arms under the flagship LG Electronics India, the consumer electronics arm of the parent.

The group is planning to integrate operations of LG Systems, the infrastructure unit, and the liaison office that will sell LG-branded mobile handsets business, with LG Electronics India.

LG Systems, erstwhile joint venture with Escorts, is into the telecom infrastructure business, while the liaison office is located in New Delhi.

However, the LG Soft India, the software development arm of the Korean firm will remain a separate business unit although it will continue to provide support to the mobile handsets business.

LG will be investing close to $5 million to build its brand for LG CDMA handsets for which it has appointed Capital as its advertising agency.

Reliance Infocomm, which is sourcing part of its CDMA handsets from LG Electronics, is expected to price its handsets at Rs 1,500, Rs 7,000 -Rs 10,000 and Rs 15,000 onwards. LG has bagged an order of $100 million from Reliance group.

LG is weighing the option of setting up a manufacturing facility for CDMA handsets in India. If LG decides to set up a manufacturing unit in India, it would be the fourth such unit outside Korea. The other three LG’s overseas units are located in China, Brazil and Mexico.

LG is also negotiating with Tata Teleservices for CDMA handsets. However, the handsets for TTSL would be different from those supplied to Reliance.

Besides, CDMA handsets, LG also plans to flush the Indian cellular mobile market with its GSM handsets. These handsets are expected to be priced “competitively” in the Indian markets.

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