The company is also going to invest Rs 1,000 crore this year to set up new capacities for cables, refrigerators, lighting and fans, while also exploring options for manufacturing of AC compressors, Gupta told ET. In 2023-24, it invested around Rs 700 crore on capex.
For the US foray, Havells has launched the ACs under its Lloyd brand, which is currently sold through the ecommerce venture of America home improvement retailer Lowe’s. Electrical cables and luminaires are sold under the Havells brand.
Gupta said the company is in the process of setting up two joint ventures in the US with two separate distribution companies where Havells India will have 75-90% ownership. One joint venture will be for sale and distribution of ACs and the second for luminaires.
“We want to create a brand in the US not just based on price, but also technology. Our team will now focus for the next two years on development of products for the US. The market there is growing,” Gupta said.
Havells has set up its US base in New York and has hired a local team there for product development and customisation matching the US norms. This is the first overseas market where Havells has set up its own base despite already exporting products worth almost $80 million. For ACs, it is targeting the installers for sales. In the US, a consumer can only install an AC through a certified installer.Executive director Rajiv Goel said AC has been covered in the Inflation Reduction Act of the US and hence there is a long-term good opportunity. He said in the next 4-5 years, the US should contribute at least 35-40% of Havells’ total international business.“It’s also a market where we can learn a lot. Consumers in the upper layer in India have global aspirations. So this foray may also help us to launch products in India aimed at a very high-end strata of the economy. In India, there are people with $80,000 or $100,000 per capita, who want the experience of developed markets,” said Goel.
In the domestic market, the Lloyd brand is a dominant player in the AC segment and is scaling up in categories like refrigerators, washing machines and televisions.
In 2023-24, Havells India clocked Rs 18,550 crore of sales, which went up 10% year-on-year, while net profit went up by 18% to Rs 1,273 crore. The Lloyd consumer durables business clocked Rs 3,785 crore sales in FY24, while losses for this business came down to Rs 164 crore from Rs 222 crore in FY23.
