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MOSL: THE CORNER OFFICE (CROMPTON GREAVES CONSUMER ELECTRICALS) — Focus on new product launches and higher ad-spends

THE CORNER OFFICE (Crompton Greaves Consumer Electricals) — Focus on new product launches and higher ad-spends; Evaluating inorganic opportunities in select categories with aim to be market leader

 

Mr. Shantanu Khosla, Managing Director

Prior to joining CROMPTON in Aug’15, Mr. Khosla was with P&G, where he spent 30 years. He was CEO & MD of P&G India for 13 years. Under his leadership, P&G India’s revenue increased 15-fold to USD1.8b, making it one of the fastest growing consumer companies in the country. Revenue growth at P&G was driven by expansion of product portfolio and distribution reach.

 

We met Mr. Shantanu Khosla, Managing Director of Crompton Greaves Consumer Electricals (CROMPTON) for an update on the company’s business and strategy. Our key takeaways:

• Long-term growth drivers in place: There is room for significant growth across categories, led by long-term drivers that include urbanization, low-cost housing, penetration, etc. CROMPTON sells products that come under basic needs. For e.g. 50-60% households are pucca houses and have electricity, and therefore, a fan is the first product that a consumer will buy. Similar trends exist for the Lighting segment. Utility for Pumps is movement of water, again a basic need for life. In addition to the sectoral tailwinds, CROMPTON is aiming to increase its market share.
• Industry dynamics/competition intense but need for differentiation: While the industry indeed has low entry barriers, to achieve success, the barriers are higher. For e.g. many companies are offering fans, yet the market concentration is quite high amongst the top 4-5 players. This is because these top 4-5 players have invested in product portfolio and distribution network.