R1. Introduction

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1.1INTRODUCTION TO VIDEOCONVideocon is an industrial conglomerate with interests all over the world and based in India.

Thegrouphas 17 manufacturingsitesin India andplantsin China, Poland, Italy and Mexico.

Itis alsothethird largestpicturetubemanufacturerinthe world.

Videocon is an Indian multinational with interests in Consumer Electronics, Home

Appliances, ColourPicture Tube Glass, and Oil & Gas. Videocon was founded in 1987 by

Nandlal Madhavlal Dhoot. Atthattimeitusedtomanufacture TV and Washing Machine. In

1989-90, Videoconstartedmanufacturing Home Entertainment Systems, Electric Motors &

AC. Videoconentered Refrigerators andcoolerssegmentin 1991. In 1995, Videoconstarted

manufacturing Glass shells for CRT and in 1996 it ventured into Kitchen appliances and

crude oil segment. In 1998, Videocon started manufacturing Compressors & Compressor

Motors. In the year 2000, Videocon tookover Philips Color TV Plant. In 2005, Videocon

tookover3 plantsofElectrolux India and acquired Thomson CPT. Today, ithasevolvedinto

a giantconglomerate with annual revenuesofoverU$4.1 billion

1.1.1 BUSINESS INTERESTS OF VIDEOCON

y Consumer Electronics & Home Appliances:Videoconenjoys leadershippositioninconsumerproducts like ColourTelevisions, Washing

Machines, Air Conditioners, Refrigerators, Microwave ovens and numerous other home

Appliances. Videocon's refrigerator manufacturing enjoys synergy with its in house

compressormanufacturingtechnology in Bangalore.

y Display industry and its components: Afterthe acquisitionofThomsonin 2005, Videoconhasemerged asoneofthe largest Colour

Picturetubemanufacturersinthe world. Ithasplantsin Mexico, Italy, Poland and China and

manufactures a range of high-techproducts such as slim CPT, extra slim CPT and High

Definition 16:9 format CPT.


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y Colour Picture Tube Glass:Videocon is one of the largest CPT Glass manufacturers in the world. It hasplants in

Poland and India. Videocon's CPT Glassmanufacturingcomplements its ColourPicture

tubemanufacturing business.

y Oil and Gas:Videocon Grouphasinterestsinoil & gasexploration, prospecting andintendstogetintogas

distribution. Itproduces 7% ofall oil intheprivatesectorin India. Videocon's Ravva oil field

hasoneof the lowestoperatingcosts in the world and itproduces 50,000 barrelsofoil per

day. Videocon is also actively looking for exploration and production opportunities in

countries like Oman, Australia andthe TimorSea nearIndonesia.

1.1.2 MAJOR ACHIEVEMENTS OF VIDEOCON INDUSTRIES LTD

The largestpanel productionfacility inthe worldunderoneroofprovidingvery high

economiesofscale.

Oneofthe world's largest andmostrespected CRT glassmanufacturers.

Firingthe largestfurnaceofitskindinthe world with a tanksizeof3300 sqft.

Oneofthefew companiesinthe worldtoconvertsandto TV.

Oneofthe largest andmost acknowledged CPT manufacturerinthe world.

Manufactured India'sfirstrust-free Washing Machine.

1.1.3 MILESTONES OF VIDEOCON

1987: Color& B/W TV, Washing Machines.

1989-1990: Home Entertainment Systems, Electric Motors, AC.

1991: Refrigerators, Coolers.

1995: Glass ShellsforCRT.


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1996: Kitchen Appliances, Crude Oil.

1998: Compressors, CompressorMotors.

2000: Philips ColorTV Plant Takeover.

2005: Electrolux India 3 Plants Takeover, Thompson CPT acquisition.

2008: Sansui & Akai Takeover.

1.1.4 TIE-UPS WITH GLOBAL LEADERS

PartnerProduct NatureofTie-Up.

Samsung Electronics Fly Back.

Transformers, Tuners Technical Support.

Matsushita Electric Washing Machine Technical (Collaboration).

Matsushita Electric AirConditionerDesign & Drawing.

Matsushita Electric RefrigeratorDesign & Drawing.

Sansui Electric Co. Ltd Audio Products.

ColourTV ODM forIndian Market.

Techneglas Glass Shell Technical Collaboration.

Akai Audio Products.

ColourTV ODM forIndian Market.

Hyundai ColourTV ODM forIndian Market.

Electrolux AB Sweden Refrigerator.

AirConditionerand Washing Machine .

ODM & Indian Market.

SourcingofcomponentsforGlobal Market.


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1.1.5 VISION, MISSION & OBJECTIVE OF VIDEOCON

Vision:

y To becomethe No.1 Service Providerin India.y To build a brand aroundsubstance.y Tocommunicatesimpletruthsthatcustomersunderstand.y Become a leader inourchosen field and become a globally recognized, prestigious

company throughsynergistic businessinvestment, differentiationthroughinnovation,

passion through empowerment, cost through economies of scale and world class

systems.

Mission:

y Toensure Total CustomerDelight by offeringprompt andquality services.y Contributetoproductquality improvements.y Trainserviceforcecontinuously onfieldrequirement.y To buildtheimageofcustomerservice andtoensure benchmarkingofall functional

areas withthe bestinthetrade

Objectives:

yTo restructure the service network in terms of automation, infrastructure andmanpowertomeetthe bestofservicerequirements andtominimizeserviceresponse

time aspermarkettrends.

y Toestablish theserviceorganization as a value addition to the brand and toprovidetotal customerconvenience andsatisfaction atpar withorbetter than the best in the

trade.

1.1.6 FUTURE PLANS

To strengthen and maintain & its leadership status, the Videocon group has clearly

chartedoutitscourseforthefuture. Aggressivedevelopmentisinfull swing atthe R & D

Centres to bringout state-of-the-art technologies including True Flat, Slim, Extra Slim,

Plasma & LCDs, at the earliest. Cost rationalizationprocesses - are in various stages -


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including rationalizing factories in Europe, increasing automation and improvement of

efficiency in China, accessingflassshellsfrom India forinternational CPT facilities and a

lot more- are in various stages of implementation. Internationally all existing client

relationships are beingstrengthened. Thecostcompetitiveness andincreaseincapacity in

Mexico and Pollandhasopenedup bigopportunities in the OEM business. Last butnot

the least, inthedomesticmarketconsolidation withmultiple brandspavesthe way foran

unassailable leadinthemarket.

In the Oil & Gas business, having all the basic operator capabilities of a prospecting

entity, the group is looking to add more explorations andproduction depth as also oil

bearing assets. Thegroup will alsogetintogasdistributionin India significantly.

1.1.7 VIDEOCON TO SET UP 9 SEZs

The Videocon group is on a roll. While it's already within striking distance of the largest

overseas acquisition by an Indiancompany, Videocon's activity on thedomestic front isno

lessspectacular. Videoconissettingupninespecial economiczones (SEZs)in Maharashtra,

West Bengal, Gujarat and Karnataka with a total area ofover 12,000 acres. J M Morganhas

been appointed as advisortochalkoutstrategies insettingup infrastructureprojectsforthe

group acrossthecountry.

Group chairman Venugopal N Dhoot will sign the memorandumof understanding with

Maharashtra Chief Minister Vilasrao Dekhmukh late for setting up two SEZs in the state.

These SEZs will besetup in Puneover 3,000 acresof land and in Aurangabadover 6,600

acres. Thegroup will settheupmaximumnumberofSEZs -- five-- in West Bengal.

However, the total size of these SEZs will be over 2,300 acres. It will set up two multi-

product SEZs l-- oneeachin North 24 parganas and Howrahdistrict. A foodprocessing and a

IT-zone will come up in Siliguri. It will also set up a sector-specific zone in North 24

Parganas. These SEZs areexpectedtocreate 50,000 employmentinthestate.

It will alsosetupone SEZ eachin Gujarat and Karnataka which are yetto befinalised. The

SEZ in Gujaratmay comeupnear Gandhinagaron 100 acresof land. Dhoot told Business

Standard that the initial investmentfor the SEZs in Maharashtra would be around Rs 2,000


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crore (Rs 20 billion) whichmightshootupto Rs 25,000 crore (Rs 250 billion)innearfuture.

These SEZs wouldcreateemploymentfor50,000 peoplein Pune and 75,000 in Aurangabad.

They both wouldhavecaptivepowerplants.

Whilethe Pune SEZ would be a multi-productone, the Auranagbadzone wouldpartially bedevelopedforfloriculture andhorticultureincluding largescaleorchidfarmsforexporttothe

US and Europe. Videocon Reality Infrastructure, anunlistedentity, will chipin withthe bulk

of investment whileVideocon Industries, thegroup'sflagshipentity, will invest Rs 50 crore

(Rs 500 million) to begin with and will have the right topurchase the entire equity atpar

withinnextfive years. Thestategovernment'sinvestmentinthesezones will becapped at 26

per cent. Videocon is also in talks with foreign investors for developing infrastructure and

investingin SEZs. Thegrouphasstartedrecruitingpeoplefromthe UAE and China tomeet

the human resource requirement of its SEZ programme. Dhoot has been eyeing the SEZsectorforovertwo years whenthesectorwasnotontopofIndia Inc's agenda.

1.2INTRODUCTION TO CONSUMER DURABLE MARKETBefore the liberalization of the Indian economy, only a few companies like Kelvinator,

Godrej, Allwyn, and Voltas were the major players in the consumer durables market,

accountingforno lessthan 90% ofthemarket. Then, afterthe liberalization, foreignplayers

like LG, Sony, Samsung, Whirlpool, Daewoo, Aiwa came into the picture. Today, these

playerscontrol themajorshareoftheconsumerdurablesmarket.

Consumerdurablesmarketisexpectedtogrow at 10-15% in 2011-20112. Itisgrowingvery

fast becauseofrise in livingstandards, easy access toconsumerfinance, and widerangeof

choice, as many foreign players are entering in the market. Consumer durables are the

products whose lifeexpectancy is at least 3 years. Theseproducts arehardgoodsthatcannot

beusedup atonce.

Consumer durables Sector can be classified as follows:


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y Consumer Electronics:Consumer electronics includesVCD/DVD, home theatre, musicplayers, colour televisions

(CTVs), cameras, camcorders, portable audio, Hi-Fi, etc.

y White Goods:White Goods include dishwashers, air conditioners, water heaters, washing machines,

refrigerators, vacuum cleaners, kitchen appliances, non-kitchen appliances, microwaves,

built-in appliances, tumbledryer, personal careproducts, etc.

Colour Televisions

Colour Televisions (CTV) is one of the dominantproducts in the Consumer Electronics

segment. Withtheupgradationoftechnology, therehas been a shiftfromconventional TVs

to Flat TVs andfrom Flat TVsto Slim and Ultra Slim TVs. Themarkets arechangingrapidly

fromtheconventional CRT technology toflatpanel display televisions. Withthetechnology

changing dayby day, the new trends in television industry is Flat Panel Display (FPD).

Undergoingmetamorphosis, FPD market is turning from low volume, highpricing and low

consumerawareness to affordablepricing anddesireforenhanced technology andcinematic

viewingexperience. ItcomprisesofLiquid Crystal Display (LCD) TV and Plasma (PDP) TV.

Thehighendproducts, particularly LCD TVscontinueontheirgrowthpath.

LCD is theonly technology other than CRT that extendsdown to less than 20 inchscreen

sizethereby makingit a natural replacementto CRT TVs. Currently Plasma TVextendsdown

toinch, butthe CRT marketis largely below thissizei.e., 29, 21, 20 and 14.

Though Plasma TV also enjoys growth, it is feeling the heat from its LCD

counterpart.Smaller and more affordable LCDs have managed to penetrate the market

compared to the larger andmoreexpensiveplasma displays. PDP displays areoffered from37-inchupwardscreensize, whereas LCD TVs are availablefrom 20-inchupwards.

The LCD TV segment in India ispoised for significant growth in the coming years. The

Indian market is witnessing a consistent growth in LCD TV sales. This growth has been

spurred by a majordrop inprices by leading brandscoupled with widespread acceptance in


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worldwide markets. The consumer today does notprefer bulky and heavy CRT TVs with

lower resolutions. High Density, space efficient sets are in vogue. LCD TVs offer better

benefits in terms of convenience of space, better aesthetics, better picture quality, easy

installation, low maintenance etc. The LCD TV finds popularity with the discerning

consumers and thehospitality sector while the PDP with corporate buyers, shoppingmalls,

airport andsuchotherplacesofpublicviewing.

Thekey growthdriversofCTV businessin India are likely to be:

y Emergenceofnuclearfamilies.y Phenomenal growthofmedia andentertainment in India andtheflurry oftelevision

channels andtherisingpenetrationofcinemas are alsothegrowthdrivers.

y Growthoforganizedretail.y Higherdisposable income withgreater aspirations anddemographics tilted towards

youngercustomers.

y Thedemand forLCD TV isexpected toemergenotonly fromurban areas but alsofromsemi-urban areas.

y Thenarrowingpricegap between conventional TV and Flat TV and similarly FlatTV and LCD TVsisoneofthemaindrivers.

y The decline inpricesofColour Televisions that is expected to trigger surge in thedemandofColourTelevisionsespecially LCD TVs.

y Electrificationinrural India andincreasing aspirationsofpeopleinrural India.y Multiple TV demand from middle and high income categories and replacement of

conventionto Flat and Flatto LCDs.

y Ready availability ofwide array ofproducts.y Thepenetration level ofCRT TVsin India is lower, ascomparedtoothercountries,

worldwide.

y E-Commerce offers great benefits and has also turned out to be a growth driver.Consumers are willingtopurchase brandeditemsovertheinternetinsteadofmoving

aroundfromoneshoptoother.

Some of the leading players in the colour television segment include Videocon, Onida,

International playerssuch as LG, Samsung and Sony.


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Refrigerators

Refrigerators areoneofthemoststandardfeaturesin Indianmiddleclasshomes. Directcool

segmentremainsthedominantsector. However, frostfreesegmentis witnessingthehighest

growthinthecategory andisexpectedtotakeoverdirectcool salesincoming years.

Therehas been a qualitativechange inconsumerpreferences whereinconsumers are willing

tooptforhigherendproductsresultinginthegrowthoffrostfreesales. Also, thesaleoffrost

free segment is getting reinforced by the replacementpurchases at urban and semi-urban

areas. Owingtothe lackofbasicinfrastructural requirements likeelectricity andvoltage, the

rural penetration level is still very low. Videocon, LG, Whirlpool, Samsung, Godrej,

Electrolux and Kelvinatorarethe leading brandsintherefrigeratormarket.

Thekey growthdriversofrefrigeratorbusinessin India are likely to be:

y Higherdisposable income available with the youth withgreater aspirations bringingabout a qualitativechangeinthepreferences.

y Emergenceofnuclearfamily andchanging lifestyletrends.y Electrificationinrural areas backed by strong aspirations.y Changingperceptionofrefrigeratoras a utility productratherthan a luxury product.y Growthoforganizedretail.

Air Conditioners

India will continueitssustainedgrowthinthe AirConditionersmainly on accountofstrong

demandfromconsumers andcorporate buyers. However, atthemomentthe Indian window

Air Conditioner market is experiencing strong competition from mini splits. Demand from

theresidential AirConditionersegmenthas witnessed a shiftfrom window ACstosplit ACs.

The AirConditionermarketin India has beenexpanding becauseofincreasedinvestmentsin

high-end industries and introduction of more sophisticated industrial processes. New

commercial users and existing users such as retail outlets, malls, hotels, restaurant, travel

agencies have also contributed to the growth of Air conditioner markets. Another major

contributorsto Indian AC Markethas beenthe boom inthe Indiansoftware industry i.e., IT

Parks, Call centers and BPOs.


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Riseininputcostsespecially steel, copperand aluminumcontinueto be an area ofconcern.

The leading brandsinthe AC market are LG, Samsung, Videocon, Onida, Voltas, Electrolux

and Godrej.

ThegrowthdriversofAirconditioners are:

y Increaseindisposableincomes.y Boominthereal estateindustry.y Easy financeoptions.y Lowpenetrations.y AcceptanceofAirConditioners as a utilityproductratherthan a luxury.

Washing MachinesWashing Machines are now increasingly finding a place in Indian homes. The high-end

segment comprisesof fully automatic andfront loaders and low-endsegment comprisesof

semi automatic and top loaders. The fully automatic category is showing a higher growth

rate, but the semi automatic continues to dominate in terms of market share. Key growth

driversforthefully automaticsegmenthave beendiminishingpricedifferential betweenthe

high end and low-endranges andminimal manual interventionduringthe washingprocess.

The leading brandsinthe washingmachinemarket areVideocon, LG, Whirlpool, Electrolux

and Samsung.

Microwave oven

The Indian Microwave oven market consists of the grill and convection segments and the

solosegment. Thesolosegmentisslowly losingitspopularity inurban andsemi-urbancities

butstill hassomedemandinrural areasorsmallercities, dueto low prices.

The convection segment continues to register themaximum growth. Thehigher growthof

convectioncategory ison accountofgrowingconsumerawarenessofmicrowaveoven as a

cooking device. Further, in recent times, the convection category of microwave ovens has

becomemore affordable.

The leading brands in the micro-wave segment include Videocon, LG, Samsung and

Whirlpool.


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Oil and Gas Industry

India is today the 5th largest consumer of energy and imports close to 75% of its oil

requirements (Source: DGH). In thepast few years, countrys economy has witnessed a

healthy 7% to 9% growthrate. Tosustainthishighgrowth, India needssubstantial quantity

ofcrude andnatural gas.

Theexploration forhydrocarbons in India began in Assam in 1866, with thecountrys first

discovery made at the Digboi oilfield in 1890. The industry received a fillip in the 1950s,

whenthe GoI enteredtheoil andgassectorby establishingthe Oil and Natural Gasirectorate

(thepredecessorto ONGC)in 1955, creatingstate-ownedrefinery companies (Indianfineries

Limited in 1958 and Indian Oil Company Limited in 1959, which weremerged in 1964 to

form the Indian Oil Corporation), and forming exploration and developmentjointventures

withexistingdomestic andforeignoil andgascompanies (Oil India Limited withthe Burma

Oil Company andthe Assam Oil Company, and Indo-Stanvac Petroleum Company Limited, a

jointventure betweenthe GoI and StandardVacuum Oil Company).

The 1960s were increasingly dominated by state-owned entities andjointventures between

the GoI andprivateoil andgascompanies. Inthe 1970s, the GoI implementednationalization

policies, taking over the operations of companies such as IBP, Esso, Caltex and

Burmah-Shell.

Virtually all aspectsoftheoil andgas industry werehighly regulated, includinginvestment,

exploration, production, distribution andpricingofall petroleumproductssoldinthemarket.

The first commercial offshore hydrocarbon discovery was made at Bom bay High in 1974.

Following the discovery of several oilfields between 1960 and 1990, domestic crude oil

productionrosefrom 3.0 milliontonnesin 1965 to 34.2 milliontonnesin 1990.

In 1997, NELP was implemented. Under the first roundof NELP bidding, the GoI invited

bids for 48 blocks for exploration of oil andnatural gas. In the subsequent five roundsof

NELP, the GoI offered 25, 27, 24, 20 and 55 blocks, respectively. In theseventh and latest

completed round of NELP, the GoI has offered 57 blocks, and 44 blocks were awarded

(Source: Business Standard).


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In the eighth round of NELP a total of 70 blocks have been offered. These include 24

deepwaterblocks, 28 shallow waterblocks, 8 onland blocks and 10 Type-S blocks. A total of

76 bids have been received for 36 blocks. A total of 62 companies comprising 10 foreign

companies and 52 Indian Companieshave bidontheirownoras a partofconsortia. (Source:

Ministry ofPetroleum & Natural Gas).

With the formulation of NELP, the ministrys objective of increasing thepace of reserve

accretion appearsto be achievingresults withdiscoveries and accretionofdomesticreserves.

A largeproportionofthesediscoveriescan be attributedtoprivatesector, owing largely toits

ability todeploy best available technical expertise worldwide, making their findsper block

ratiomore favourable than PSUs. Therefore, despite aggressive bidding by PSU players, no

major findhas yet been announced by them (thepotential ofONGCs find in Cambay and

KG basinsiscurrently underassessment).

1.2.1 COMPETITORS OF VIDEOCON

y LG Electronics:LG Electronicsisthe world'ssecond-largestmanufacturerofTelevisionsets andthird-largest

producerofmobilephones. Withitsheadquartersinthe LG Twin Towersin Yeouido, Seoul,

South Korea, LG Electronicsistheflagshipcompany ofLG Group, oneofthe world's largest

electronic conglomerates. The company has 75 subsidiaries worldwide that design and

manufacture televisions, home appliances, and telecommunicationsdevices. LG Electronics

owns Zenith Electronics andcontrols 37.91 percentofLG Display.

By 2005, LG was a Top 100 global brand, andin 2006, LG recorded a brandgrowthof14%.

Its affiliate, LG Display, isnow the world's largestplasma panel manufacturer.

Electronics LG Electronics rightly understood theconsumermotivations tocreatemagneticproducts, price them strategically, position them sharply and keep making the magnetism

morepotent. Havingunderstood the finerdifferences in consumermotivations, itopted for

sharp- arrow reasons-to-buy differentiationoverthe blanket-all approach taken by mostof

theotherplayers. Itis an aggressivemarketer. Itfocuseson low andmediumpriceproducts.


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A strong distribution network is absolutely essential to compete in this industry. Not only

does it guarantee a country wide reach for a companys products but is also

necessary forproviding good after sales service. Videocon has implemented ERP system,

which helps in integrating the manufacturing, marketing, procurement and distribution

services withthecorporateoffice.

LG Electronics sells in 1800 towns and cities with a population of 1,00,000 and above.

Samsung also has a widespread service network, which includes 123 exclusive service

centres and 200 distributorsin any town withmorethan 1 lakhpopulation. All BPL dealers

are linkedvia VSAT nodes, ensuringonline availability of informationon inventory status

andsalesmovement. Distributionhence isdifficult andcostly asestablishedfirmsdominate

distribution.

y SAMSUNGInitially the strategy of Samsung in India was to createpremium image by emphasizing

global brand. After facingstiffcompetition from another Koreanmajor- LG, Samsung also

startedplayingpricegame. In 2004 itreverted back to itspremiumpositioning, although it

resulted insome lossofmarketshare. In line withthe Global Digital Initiativeofthe Parent

Company, Samsung India isseeking to acquiredigital leadership in India by introducing its

digital ready televisions like the 40" LCD Projection TV, 43" Projection TV and the Plano

seriesofFlat Colourtelevisions.

Samsung Electronics was founded in 1969 in Suwon, South Korea as Samsung Electric

Industries, originally manufacturing electronic appliances such as TVs, calculators,

refrigerators, airconditioners and washers. By 1981, thecompany hadmanufacturedover10

million black and white TVs. In 1988, it merged with Samsung Semiconductor &

Communications. In 2006, Business Weekrated Samsung as 20thonits listofglobal brands,

2ndintheelectronicsindustry. Business Weekalsoranked Samsung as 20thininnovation. In

January 2007, BrandFinancerankedthecompany asthenumber1 global brandinelectronics.


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y ONIDAItspopular devil ad although had engendered a strong emotional pull towards the brand,

technologically itrepresentedno advancement. Thecompany pluggedthegap by touting its

digital technology. LikeVideocon, ithas also been abletoholditsmarketshare. The world-

classquality ofOnida hasenabledthecompany tomake a breakthroughontheexportfront.

Ithastechnical tie- up withthe JapanVictorCompany, betterknown as JVC. Sofocused is

Onida onpositioningitselfonthepremium, high- techplankthatitisevenplanningtopush

itsown envelopeonobsolescence, much. The strategy is aimed at further broad basing the

productofferingof thecompany, whichhas largely dominated the top-endof the television

market, acrossmultiplemarketsegments.

Onida is a popularelectronics brandin India. Onida has a networkof33 branchoffices, 208

CustomerRelation Centers and 41 depotsspread across India. Ason 31 March 2005, Onida

had a market capitalization of Rs.301.46 crore. Mirc Electronics won an Award for

Excellence in Electronics in 1999, from the Ministry of Information Technology,

GovernmentofIndia.

Onida with its Sales & Marketingoffice in Dubaireported a 215 percentexportgrowth in

two years, setting the base for an increasedrobust international presence. Theshipments to

the Gulfcontribute almost 65 percentofOnida'sexportrevenue, whileshipmentstothefast

growing East African market (Uganda, Tanzania, Kenya and Ethiopia) and the SAARC

countries accounted for 16 per cent of export revenues. Home Theatres and DVD players

have been introduced in these markets to strengthen the Onida brand presence. These

products have customized models with local language user interfaces in line with its

geographiesoffocus. Onida models arenow available with Arabic, Persian and Russian OSD

(menu).

In additiontothe Gulfcountries ONIDA hasnow a sizeablepresencein Russia, Ukraine and

neighboring CIS countries. ONIDA has already crossed 100000 mark in CTV exports to

Russia in a spanofjust 2 years andplans togrow in thesemarkets at a much fasterpace.

Apart from Television Exports to Russia, Onida also exports DVD Players and High end

LCD Televisions.


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SONY

Sony Corporationorcommonly referredto as Sony, is a Japanesemultinational conglomerate

corporation headquartered in Minato, Tokyo, Japan and the world's fifth largest media

conglomerate with revenue exceeding $78.88 billion U.S. (FY2008). Sony is one of theleading manufacturers of electronics, video, communications, video game consoles, and

information technology products for the consumer andprofessional markets. Its founders

Akio Morita and Masaru Ibuka derivedthenamefromsonus, the Latin wordforsound, and

also from the English slang word "sonny", since they considered themselves to be "sonny

boys", a loan word into Japanese which in the early 1950s connotedsmart andpresentable

youngmen.

Sony Corporationistheelectronics businessunit andtheparentcompany ofthe Sony Group,

which isengaged in business through itseightoperating segments Consumer Products &

Devices (CPD), Networked Products & Services (NPS), B2B & Disc Manufacturing (B2B &

Disc), Pictures, Music, Financial Services, Sony Ericsson and All Other. Thesemake Sony

one of the most comprehensive entertainment companies in the world. Sony's principal

businessoperations include Sony Corporation (Sony Electronics in the U.S.), Sony Pictures

Entertainment, Sony Computer Entertainment, Sony Music Entertainment, Sony Ericsson,

and Sony Financial. As a semiconductor maker, Sony is among the Worldwide Top 20

SemiconductorSales Leaders.

1.2.2 MERGERS, ACQUISITION & TAKEOVERS BY VIDEOCONPHILIPS & VIDEOCON

Philips Electronics, the Dutch consumer durables giant, has officially signed a 5-year

licensingpact with India-basedVideocon Industries Ltd. tomarket its televisionsets across

the Indiansub-continent. Theinformation wassharedon Monday by a top Indianofficial.

"This ispart ofPhilipsglobal strategy to improve theprofitability of its TV business. We

have signed a 5-year brand licensing agreement withVideocon where in they will source,

distribute, sell andmarket Philipsconsumertelevisionsin India", Mahesh Krishnan, Headof

ConsumerLifestyle businessin India.


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Under the terms of the newly signed deal, Philips will be entitled to royalty by the Indian

Videocon andtheformerisexpectingthepactto boostitstelevisionsales acrossthecountry

withthehelpofthe latter'sextensive, countrywidesales anddistributionnetwork.

In March 2010, Videocon had failed a bid to takeover Elcoteq, a Finnish electronicscompany. In a weak tradingsession in Mumbai, sharesofVideoconclosed 1.74% lower at

Rs. 234.9.

ELECTROLUX KELVINATOR & VIDEOCON

NEW DELHI: Moving fast to consolidate its status in the consumer goods sector, the

Videocongrouphas takenover the entire 91.85 per cent shareholdingof AB Electroluxof

Sweden in its Indian subsidiary, Electrolux Kelvinator. After completion of the deal, the

Swedishcompany inturn will acquire about 5 percentshareholding inVideocon Industries

with aninvestmentofabout $94 million.

The announcement, which comes just a few days after Videocon took over the French

consumerelectronicsmajorThomson'scolourpicturetubeunits, says Electroluxhasentered

into a "strategicpartnership'' with the Videcon group. Under a separate licence agreement

with AB Electrolux, the Videocon group will distribute products under the Electrolux,

Allwyn and Kelvinatorbrands. The licences will bemanagedthrough a new branchofficeof

the Swedishcompany here, which together withVideocon will promotesalesofElectrolux

products. The branch office will manage the global sourcing needs of AB Electrolux from

India. As a result of this strategic partnership, Electrolux said it would move from a

subsidiary to a licensingmodel.

According to company statements issued here on Thursday, the boards of directors of

Videocon International andVideocon Industries have also approvedthe merger of the two

companies. Theshareswapratiohas beenfixed at 5:1, whichmeansthattheshareholdersof

Videocon International will get one share of Videocon Industries for five shares that theyhold.

Under the agreement signed by AB Electrolux and the Dhootsof theVideocongroup, the

Indiancompany will takeoverElectrolux'smanufacturingplantsin Shahjanpurin Rajasthan

as well as Warora and Butibori in Maharashtra. The three-tierpartnership between the two


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firms includes marketing Electroluxproducts in India and sourcing components from the

country forElectrolux'sglobal operations. Itcomprisesoriginal equipmentmanufacturing by

a local outfitforElectrolux'sglobal marketinthenextfive years. All theserelationships are

targeted toculminate into a trade turnoverofover Rs 6,000 crore annually innext three to

five years, says a release.

SANSUI & VIDEOCON

Farhath Husain, local organiserofthe SansuiVideoconshow held at Wembley in Londonon

May 29, was hospitalised after he lost Rs 5 crore invested in the show, which boasted of

performances by Lara Dutta, Esha Deol, Salman Khan, Rani Mukerji, Malaika Arora and

Shahrukh Khan.

I wasnt even told that the show wasprimarily staged for a telecaston Sony EntertainmentTelevision. Butfansgot a whiffofthechannelsplan, anddecidednottoturnup, explained

Husain. Besides, theones whodid attend wereputoffonseeing theirfavourite actorsgive

singlefive-minuteperformances. I went all outpromoting it as an awardfunction andsince

there arenosponsors forLondon, my only sourceofrevenue was ticketsales, says Husain

whorecovered a mere Rs 3 croreofthe Rs 8 crorehehadinvested.

Never in my 17-year career have I faced such immense failure, he said. A disappointed

Ameeta Parmar who attended the show complained, Unlike the highly successful

Birmingham show, this one was a disaster. It started an hour late! Tusshar Kapoor and

Riteish Deshmukh, Esha Deol and Lara Dutta performed a numbereach. AfterRani Mukerji

danced on tracks from Paheli and Bunty Aur Babli, Salman Khan wason stage for barely

fourminutes!

Parmaralsofeltthatprecioustime was wastedonhandingoutthe awards. I evenforgetthe

nameofthegirl groupthatperformed. Whatsmore, the lights abruptly wentoffat 10.30 am

andhost Sajid Khanmurmured Goodnightintothemight withoutsomuch as anexplanation.

1.2.3 CORPORATE GOVERNANCE

The company's philosophy on corporate governance enshrines the goal of achieving the

highest levelsoftransparency, accountability andequity in all spheresofitsoperations andin


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1.2.5 FUTURE PLANS

Tostrengthen andmaintain & its leadershipstatus, theVideocongrouphas clearly charted

outitscourseforthefuture. Aggressivedevelopmentisinfull swing atthe R & D Centresto

bringoutstate-of-the-arttechnologiesincludingsemi automatic, attheearliest.

Cost rationalizationprocesses - are in various stages - including rationalizing factories in

Europe, increasing automation andimprovementofefficiency in China, accessingflassshells

from India for international CPT facilities and a lot more - are in various stages of

implementation. Internationally all existing client relationships are being strengthened. The

cost competitiveness and increase in capacity in Mexico and Polland has opened up big

opportunitiesinthe OEM business. pavesthe way foranunassailable leadinthemarket.

In the Oil & Gas business, having all the basicoperatorcapabilitiesof a prospectingentity,the group is looking to add more explorations and production depth as also oil

bearing assets. Thegroup will alsogetintogasdistributionin India siginificantly.

1.2.6 SWOT ANALYSIS

Strengths:

Videoconhas largestdistributedcapacity manufacturing base across India with 17 facilities

andplantinchina, Poland, itally, Mexico withmanufacturingcapacity is 1, 40000 units.

y Videoconhas a networkof400 plusservice and 85 mobileservicevanstogive betterservicetotheircustomers.

y Tie up with the Matsushita electric company of Japan add to the goodwill ofVideocon.

y Customers are aware aboutVideoconsproducts.y Company hasgood brandname.y Strong backwardintegration.y Videoconhas largestdistributionmanufacturing based acrossin India.


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y Large brand basket.y Multi brandstrategy.y 3rd largestpicturetubemanufacturein India.y Cheapprice.y Globally acceptance.

Weaknesses:

y Lessinvestmenton advertisementofVideocon CTV.y Fewermarginstothedistributor/dealer.y Weakpromotional strategy ofCTV.y Noproperapproachoftargetcustomer.y Wide brand basket, which might lead to conflictof interest unless Effectively

managed.

y CRT technology is losingpopularity.y Lessfocusonunconventional channel.y Notprovidinggoodservice.y Noexclusiveshow rooms.

Opportunities:

y Videocontakesoverthe Electrolux.y Videocon buy Thomsoncolorpicturetubemanufacturingplant.y Videoconinternational isgoingglobal.y Videoconexploring wholenew segmenty DuringtheclimateofJaipurbecomeshotterday by day andcoolersdonotfully satisfy

thecustomersrequirement. Thisprovides a great Opportunity foracmanufacturers.


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y Growingsemiurbanmarket.y Industry isinincreasingphase.y Pricehascomedown;now more andmorepeople aregoingforit.y Duetofinancial facilitieseventhemediumsegmentisgoingforit.y Purchasingpowerofpeopleisincreasingday by day.y Movingintonew attractivemarketsegments.y Focusedonunconventional channels.y Mergersjointventureofstrategic alliances.

Threats:

y Entranceofglobal competitor likechina.y Brand loyalty ismoreofLG &othercompany.y Marketcondition likeslumpsinmarket.y A new competitorin yourhomemarket.y Competitorhas a new innovativesubstituteproductorservice.y Increasedtrade barrier.y Brandreputationisnotgood.y Competitioninglobal CPT marketespecially fromintegratedplayerssuch as LG-y Phillips, Samsung, and Matsushita isintense.

1.2.7 VIDEOCON ANNOUNCEMENTS

y Videocon Inds - Outcome of Right Issue Committee Meeting


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Jul 8 - Videocon Industries Ltdhasinformed BSE thatthe Rights Issue Committeeof

the Board of Directors of the Company, has at its meeting held on July 08, 2010,

confirmed conversion of 1,27,537 partly paid-up Equity Shares into fully paid-up

Equity Shares, pursuanttothepaymentofthe First andthe Final Call Money by the

respectiveshareholders. Thesepartly paid-up Equity Shares were allottedon April 22,

2010, on Rights Basis.

y Videocon Inds - Conversion of Partly Paid-up Equity Shares into Fully Paid-upEquity Shares

Jun 22 - Videocon Industries Ltdhas informed BSE thatthe Rights Issuecommittee

ofthe BoardofDirectorsofthe Company, have atitsmeetingheldon June 22, 2010,

confirmedconversionof2,83,09,456 partly paid-up Equity Shares intofully paid-up

Equity Shares, pursuanttothepaymentofthe First andthe Final Call Money by the

respectiveshareholders, upto June 15, 2010. Thesepartly paid-up Equity Shares were

allottedon April 22, 2010, on Rights Basis.

y Videocon Inds - Outcome of Rights Issue Committee Meeting

Jun 7 - Videocon Industries Ltdhasinformed BSE thatthe Rights Issue Committeeof

the Board of Directors of the Company, has at its meeting held on June 04, 2010,

approved conversionof 2,22,35,768 partly paid Equity Shares to Fully Paid Equity

Shares, pursuant to the payment of the First and the Final Call Money by the

shareholdersupto May 31, 2010. Thesepartly paid Equity Shares were allotted on

April 22, 2010, on Rights Basis.

y Videocon Inds - Disclosures under Reg. 8A of SEBI (SAST) Regulations, 1997

May 31 - Videocon Industries LtdhassubmittedthedisclosureunderRegulation 8A

ofSEBI (Substantial AcquisitionofShares & Takeovers) Regulations, 1997 to BSE

DateofReporting : May 26, 2010 Nameof the Company : Videocon Industries Ltd

Total noofoutstanding sharesof the Company : 282,657,334* Nameof the Entity:

Shree Dhoot Trading & Agencies Ltd Details of Transaction Date of Transaction :

May 15, 2010 Number of Shares pledged: 350,000 Aggregate details after the

transaction Total noofsharesheld by theentity inthecompany: 20948392 Total No


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ofsharespledged : 13,312,000 % oftotal sharespledgedtototal noofsharesheld by

the entity in the Company : 63.55% % ofsharespledged to total noofoutstanding

sharesofthe Company : 4.71% Note: *Outstandingsharesincludes 51,392,243 partly

paidequity shares allottedon Right basison April 22, 2010.

y Videocon Inds - Allotment of Equity Shares

Apr23 - Videocon Industries Ltdhasinformed BSE thatthe Rights Issue Committee

ofthe BoardofDirectorsofthe Company at itsmeetingheldon April 22, 2010, has

allotted 5,13,92,243 Equity SharesofRs. 10/- each at a Premiumof Rs. 215.00 per

Equity Shareon.

y Videocon Inds - Updates

Apr 6 - Videocon Industries Ltd has informed BSE that Videocon Industries Ltd.

(VIL) advisesthat M/s. Anadarko Petroleum Corporation (Anadarko), the Operatorof

blockBM-C-30 offshore Brazil inthe Campos Basin, has announcedtheresultsofthe

Wahoo-1 drillstem.

y Videocon Inds - Outcome of AGM

Mar 31 - Videocon Industries Ltd has informed BSE that the members at the 21st

Annual General Meeting (AGM)ofthe Company heldon March 30, 2010, inter alia,

hastransactedthefollowing:1. Considered andtookonrecordthe Audited Financial

Statements.

y Videocon Inds - Rights Issue of Equity Shares

Mar 23 - With reference to earlier announcement regarding Rights Issue of

51,392,243 Equity Shares of Rs. 10 Each at a Premium of Rs. 215.00 per Equity

Share aggregating to an amount of Rs. 11,563.25 Million in the Ratio of 2 (Two)Equity SharesforEvery 9 (Nine).

y Videocon Inds - Updates

Mar22 - Videocon Industries Ltd (VIL)hasinformed BSE that:"Videocon Industries

Ltd ("Videocon")clarifies, incontinuationtoitsearlierreleaseon February 18, 2010


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to the StockExchange wherein it announced the Discovery ofgas in a wildcat well

Windjammer-2.

y Videocon Inds - AGM on Mar 30, 2010

Mar 12 - Videocon Industries Ltd has informed BSE that the 21st Annual General

Meeting (AGM)ofthe Company will beheldon March 30, 2010.

y Videocon Inds - Fixes Book Closure for Rights Issue, Dividend & AGM

Mar11 - Videocon Industries Ltdhasinformed BSE thatthe RegisterofMembers &

Share Transfer Booksof the Company will remain closed from March 22, 2010 to

March 30, 2010 (both days inclusive) for thepurpose of Rights Issue, Payment of

Dividend & Annual General.

R1. Introduction

Documents

Transcript of R1. Introduction