Philips, Dutch appliances, healthcare and electrical products maker, has decided to increase the localization slab to 75 per cent from 50 per cent over the next three years. This step will certainly going to boost the Indian market as the company will be manufacturing almost 75 per cent of its product locally. Moved by ‘Make In India’ initiative and recently introduced GST, Philips is planning to make the best use of the resources available.
Shedding light on company’s future plans, V Raja, MD, Philips India said that the company may also evaluate foreign direct investment in retail at an appropriate time. With GST becoming a reality , it will make more sense to expand manufacturing in India and to adjust to supply chain needs . At present, even the products which are imported in India are made in special lines since these are customised. But the emphasis will be on local production.
Philips plans to beef up its e-commerce presence for now and evaluate the retail FDI option when its India business reaches a critical mass. The company , which is transitioning into a health technology firm with presence in segments such as kitchen and domestic appliances, personal grooming, recently demerged the lighting business into a separate entity in India as well. Lighting accounted for about 55 per cent of revenue of the erstwhile combined entity. Philips India will get back to the same size as it was with lighting in three years, Raja added.
Philips is also entering the men's skincare segment with a face cleaning brush. It will be the first brand in this segment, which is a logical extension of male grooming products, informed Raja.