EPCOS, a TDK Group company, develops, manufactures and markets electronic components and systems, focusing on technology markets that include automotive electronics, industrial electronics and consumer electronics as well as information and communications technology. We have in this exclusive interaction, Balakrishnan Natarajan discussing the Indian business of EPCOS. Natarajan explains that EPCOS, thanks to its wide product portfolio, is geared up to meet India’s growing demand from a diversity of sectors, especially the power distribution segment. An interaction by Venugopal Pillai.
We understand that EPCOS India is planning significant capacity expansion at its Nashik plant. Please tell us more.
We are increasing the production capacity of power capacitors, motor run and motor start capacitors. Currently, there is major expansion happening at our Nashik facility, with an addition of nearly 20,000 sqm. We have planned to put up robotic plant for capacitor manufacturing. This will translate into our Nashik plant becoming India’s largest capacitors manufacturing unit.
Some five years ago, EPCOS opened its Bawal plant in Haryana, strengthening EPCOS’ manufacturing presence in India. Tell us how the Bawal plant has helped EPCOS come closer to its customers in north India?
The Bawal plant in Haryana has been fully operational since 2012. We have various customers like LG, Panasonic, Diaken, in the home appliances sector, and their capacitor needs are being fulfilled from here. The Bawal plant also acts a feeder for the power capacitors markets in Delhi, Haryana and nearby states.
We have transferred one line from China to Bawal (capacitors with aluminum construction and aluminum top) and a majority of these products are being exported.
How has been EPCOS’ overall growth in India?
The growth of our business in India over the past 20 years has been very satisfying. The initial 15 years continuously gave us healthy, double-digit growth, supported by several additions in the product offerings to the market. We have been adapting our organization, both in manufacturing and sales, to match the market development and we will continue to do so.
The growth of our business in India over the past 20 years has been very satisfying.
Power factor correction is emerging as an important area with respect to energy efficiency. Given that EPCOS is a strong player in this niche domain, how do you see opportunities in India in the years ahead?
With reference to the power sector, there have been several government initiatives with huge funding support such as the Integrated Power Development Scheme (IPDS) and Ujwal DISCOM Assurance Yojana (UDAY), where state utilities get support through Central funding to improve their quality of power, thereby reducing transmission losses and moving towards 24×7 power.
Capacitors for power distribution applications help in improving the power factor by reducing the reactive power losses. Several state utilities are in the process of consolidating their requirements and tendering for these capacitors both in the medium-voltage and low-voltage range. Based on our strong portfolio of capacitors designed and manufactured in India, we see huge opportunities and business coming up in this area.
Some power utilities are known to penalize industrial consumers for poor power factor ratio. What is your overall view? Do you also feel that consumers maintaining a healthy power factor ratio need to be rewarded?
Do you see your proportion of business from power utilities rising in the coming years?
As discussed earlier there are several government schemes which have lead to major business opportunities from power utilities. Recently our Honorable Prime Minister also announced a Rs.16,000-crore budget for the Saubhagya household electrification scheme.
Overall, what is the level of awareness of power factor correction amongst industrial consumers? Do you feel that consumers are proactively going in for PFC solutions irrespective of the intervention from power discoms?
Consumers are well aware that if they maintain unity power factor they would receive maximum benefits from the utilities. Some of the industries are conscious about energy conservation at their plants. Bureau of Energy Efficiency (BEE) asks industries to submit their energy conservation or energy efficiency targets, especially for large organizations. In most organizations, there is an energy conservation department that focuses on this and defines energy targets for the year.
We started our operations in India as an export oriented unit (EOU), and even today close to 60 per cent of our production, namely film capacitors and ferrite cores, is exported out of India.
For individual customers, it could be a challenge to maintain and install PFC systems, due to it being a single-phase load. Utilities are maintaining power factor at the transformer level, which is then being fed to the small residential houses.
Tell us about the extent of localization of key EPCOS products in India. In other words, are there products in EPCOS’ global portfolio, which are relevant to India, but are not yet manufactured here?
It is actually the other way around! We manufacture all the products here in India, right from motor run, motor start, low voltage capacitors, med voltage capacitors for power factor correction and key components, which are also exported globally.
We started our operations in India as an export oriented unit (EOU), and even today close to 60 per cent of our production, namely film capacitors and ferrite cores, is exported out of India. We take pride that our products are exported across the globe to Japan and the Far East, NAFTA, Middle East, Europe and South American countries.
With the Indian government’s focus on the reformation and transformation of the economy under a wide range of initiatives, including Make in India, Digital Governance, Infra Development, Renewable Energy, Inclusive Growth and others, many promising opportunities are opening up for TDK as a strong and reliable partner. Among others, they include:
- Energy sufficiency, 24×7 power, rural electrification, power for all, renewable energy with emphasis on solar energy
- Road and rail infrastructure
- Smart cities
- Mobile phone manufacturing
- Automotive sector, especially electric vehicles
For all of these areas, TDK has a strong portfolio of electronic components and solutions to support the achievement of India’s ambitious goals.
