An edited version of this story first appeared in DNA Money edition on Tuesday, May 28, 2013.
Coinciding with its platinum jubilee celebrations, Bajaj Electricals will more than double its overall advertising spend for the current fiscal i.e FY14. The company has earmarked Rs 75 crore towards advertising as compared to Rs 38 crore it spent in FY12. The company is also looking to increase its sales turnover by 25% to over Rs 4,200 from Rs 3,416 it registered in fiscal 2012-13.
Anant Bajaj, joint managing director, Bajaj Electricals Ltd, said the company has a very elaborate spent planned considering it is their 75th year in business. "We clearly have on our mind to spend a significant money on advertising this year. In fact, you should soon start seeing significant visibility being created in the market place for our brand and products alike," said Bajaj.
Over the years, the management has been aggressively working on its distribution, product range and the consumer's requirement (in terms of a product) and it feels that advertising will only help it become better. "We have achieved very good traction in the market despite not spending too much in the past mainly because we have been smart in our spending. While continuing with that strategy, we will work smartly towards being more visible vis-a-vis competition," added Bajaj.
In another development, the company is also planning at taking its exclusive Bajaj World stores international. "A store has already been opened in Nepal, and talks are currently on for opening in Ghana, Nigeria, Sri Lanka and South Africa," said Bajaj adding that all these stores will added through exclusive franchise agreements.
As on May 1, 2013, the company had 42 Bajaj World stores operational in India and the management is looking at opening another 13-odd outlets in the next 45 days. A total of 75 stores are likely to get operational by the end of this fiscal.
The company is also in the advanced stages of setting up a new research and development (R&D) centre in Mumbai. It has a capex planned of Rs 45 crore, though not all of it has been invested in the centre as yet.
And with e-commerce starting to gain traction in the country, Bajaj Electricals has launched its e-retailing market place as well. The e-commerce portable has been up and running for the last five to six months. Bajaj said that the company is quite pleased with this initiative which has been giving them Rs 6 lakh to Rs 10 lakh worth business every month.
"We are currently selling most of the products available in the market but will gradually launch products that will be sold only through the e-commerce portal thereby creating a differentiation in the market place," he said.
The company also reported fourth quarter results for the fiscal 2013 wherein its net profit plunged 99% year-on-year to Rs 0.62 crore mainly due to restructuring of its engineering and projects (E&P) business. E&P sales declined 22% to Rs 285 crore in Jan-March and losses stood at Rs 51 crore as compared to a profit of Rs 21 crore in the fourth quarter a year ago.
Its net sales for the three-month period gained just 5% from a year ago to Rs 1,114 crore. Sales from consumer durables rose 22% to Rs 544 crore while lighting sales were up 15% to Rs 285 crore.
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