Sony plans to double equity base

NEW DELHI, June 9: Sony India Pvt Ltd, the wholly-owned subsidiary of the Japanese electronics megacorp, Sony Corporation, is doubling its ...

NEW DELHI, June 9: Sony India Pvt Ltd, the wholly-owned subsidiary of the Japanese electronics megacorp, Sony Corporation, is doubling its equity base to 21 million.

Sony Corp has so far invested 10.5-million in India as equity in its subsidiary. The additional infusion of funds in the form of equity would be invested in plant and machinery.

A sizeable part of the investment has gone into setting up a manufacturing facility in Dharuhera, Haryana, where the company assembles colour televisions and audio systems. Additional investment would double the capacity of the facility to assemble these products.

Sony India, senior manager, consumer marketing, Ravi Nookala told The Indian Express that the process of wheeling in additional investment would be completed by 1998-99. 8220;We have already placed orders for new machinery.8221;

The company has meanwhile set very modest targets for this year despite reporting 75 per cent increase in sales turnover in 1996-97. Sony is looking at a turnover of Rs 380-400 crore in 1997-98 from sales of its televisions, audios systems, video CD players and videocameras. In 1996-97, the company reported a turnover of Rs 350 crore, up from Rs 200 crore in the previous year.

Explaining the company8217;s modest projections, Nookala said, 8220;We do not see much growth in the market this year.8221; For example, Sony expects the television market to grow only 0.2 million sets this year. Against this, more aggressive players in the industry have forecast that the televisions market will grow from two million sets in 1996-97 to 2.5 million sets.Conservative estimates apart, Sony India expects its share of the televisions market to grow to seven per cent this year. The company sold about 90,000 sets for 4.5 per cent share of the market last year. The company plans to expand its existing range of products between July and September.

For the first time, the company is considering a simultaneous worldwide launch of a new range of 21 inch televisions. The new model would be assembled in India, Nookala added. Sony may, at a later date, launch models specifically made for Indian markets.

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Among other products lined up for launch are three models of hi-fi audios with CD changer. A new model of videocamera with colour LCD is also due to hit the market next month. Another product planned for launch is Sony8217;s smallest camcorder. The launch of this product was due last month but was postponed due to delay in the customs clearance for the shipment.Sony is planning to double its installed capacity to manufacture televisions and audios by year 2000. At present, the Dharuhera facility has installed capacity for assemble two lakh televisions per annum.