L to R : Mr. Siegbert E. Lapp – Managing Board, Lapp Holding AG & Mr. Srinivas P Kamisetty – MD, Lapp India Pvt. Ltd.

Lapp India, a 100% subsidiary of the Lapp Group manufactures Cables, Connectors, Cable Glands, Conduits and Accessories. They have introduced the concept of “Total Solutions in Electrical Connectivity” in India, with their unbeatable range of products. Started operations at Bangalore in 1996, with a manufacturing unit and today it is the third largest manufacturing facility of the Lapp Group. Each year about 100,000 km of ÖLFLEX® connecting and control cables and insulated single cores are produced. Recently WCI Team visited LAPP facility in Bangalore, Karnataka and here we present the excerpts of the interaction with Mr. Srinivas P Kamisetty, Managing Director, Lapp India Pvt. Ltd.

Wire & Cable India: Lapp Group recently celebrated its “50th anniversary” an achievement that showcases the tremendous success it has achieved. Kindly recount the journey so far.

Srinivas P Kamisetty: In the 50s, the upswing in industrialisation led to a huge demand for cables and conductors. Faced with this development, Oskar Lapp questioned himself on optimizing the current method – the time-consuming manual inserting of single cores and switching strands into the outer sheaths. In response to this, he invented the first industrially produced flexible, colour-coded signal cable – ÖLFLEX®. This was just the beginning and Lapp Group has consistently created benchmarks in product development since then.

Further, in 1959 Lapp set out a definite brand policy. Giving the products brand names was a completely new idea at that time, but it allowed them to be distinguished from the competition more easily. Oskar Lapp was again one of the front-runners and became one of the first people to offer this kind of catchy branding. The most well known brand is ÖLFLEX®, which has secured a place in the history of the sector.

A family-owned business, Lapp Group- was jointly managed by Oskar and his wife Ursula Ida for many years. After Mr. Oscar’s demise in the year 1987, the family business legacy is being managed by his wife Mrs. Ursula Ida Lapp and sons – Mr. Siegbert and Mr. Andreas Lapp. Based in Stuttgart Vaihingen, Lapp Group currently is one of the world’s leading manufacturers and suppliers of high flexibility cables, cable accessories, industrial connectors, pre-assembled cables and communication technology. With over 40,000 individual products, the Lapp Group is one of the major international suppliers in machine and plant construction, automation technology and measurement and control technology for the automotive industry as well as for the electrical engineering, installation, transport and energy sectors, among others. The Lapp Group has 15 production sites, 100 outlets and 40 sales organisations around the world, employing 2,800 people.

Lapp India operates through regional marketing units in Delhi, Kolkata, Mumbai, Pune, Bangalore and Chennai with 23 sales offices and a strong network of 100+ dealers throughout the country. It has posted an impressive year on year annual growth of about 30 per cent and this year, it has clocked a phenomenal 50% growth over the previous year. And now, to scale up its capacity, it will soon be starting a manufacturing unit in Bhopal.

WCI: Lapp has invested 150 crore (25 Million Euros) in the new unit coming up at Pilukedi, Rajgrah district, Madhya Pradesh. Detail us about your plans for the new unit in terms of product to be introduced, technology adoption etc.

SPK: In order to scale-up capacity from its existing manufacturing unit in Jigani, Bangalore, Lapp India is starting a manufacturing unit in Bhopal, Madhya Pradesh. Lapp is investing Rs 150 crore in this 30-acre plant in Bhopal which will be operational in April.

This facility will be Lapp’s second in India besides another one in Bangalore and is projected to be the largest manufacturing unit of the Lapp Group in the next five years. The Bhopal facility will be home to three building units with an individual manufacturing apparatus in each. In the first phase, this facility will employ around 100 people and when the facility will be fully functional it will have approximately 400 people.

Further, since geographically 70 percent of our business comes from west and south India, and Bhopal being located in the heart of India is well equipped to meet the logistical requirements of the regions while servicing potential demand from other parts of the nation as well.

Focus initially on single core cables for the building segment, the new facility will then produce other low and medium voltage cables to help meet growing demand from the northern part of India.

WCI: Your comments on Lapp Group’s long term vision for the Indian market and what potential you foresee?

SPK: The addressable cable market in India with respect to Lapp range of products is currently being valued at Rs 1000 crores. The market size for single core wires (for the building segment) today stands at approximately Rs 6000 crores. This segment also offers great potential for Lapp India to grow and innovate catering to the evolving needs of the industry.

Further, India’s economic environment is very conducive for growth and the country will remain one of the organization’s prime focus for the Asian continent. The welcoming business policies, the strong pool of skilled manpower base with an increasing disposable income and its burgeoning market have all combined to enable India emerge as a viable partner to global industry. The cultural connect between the two countries – India and Germany, is also key to this strong budding relationship between the two countries. This growth proponent has also been instrumental in building Lapp India Pvt. Ltd. into the second largest operations base for the parent company. Growth potential in Asian market as a whole also seems very exciting.

In addition to the upcoming facility at Bhopal, Lapp is catering to growing market requirements and two new warehouses are also going to be added – one in Coimbatore and the other one is being evaluated for the Western India region. Also, we will be setting up 16 service points across the country by the year 2012.

WCI: What challenges Lapp group has faced and might face in implementing its plans for the Indian growth trajectory?

SPK: As per estimates, approximately 30 percent of India’s cable industry comprises of regional and unorganized players. The presence of unorganized sector is seen especially in the building connectivity segment. Organized sector of the cabling industry mainly caters to manufacturing of high voltage, durable and specialty cables. The challenges are comparatively broader in the low voltage industry segment where quality standards are often seen compromised.

Educating customers about the existence of important certifications such as ISI, product certification from BIS etc, is very essential in this industry. Also, given the fire related accidents that take place in India as a result of poor quality of cabling, non-adherence of established standards can be quite disastrous. The VDE standards are harmonized with IEC (International Electric Commission) and are more stringent than ISI and Lapp products are in compliance with IEC standards to ensure utmost safety to users.

WCI: The journey of 50 years must be backed by certain philosophies, values, strengths, etc. Kindly elaborate on the same.

SPK: We, at Lapp Group have values which have strengthened Lapp over the past 50 years and continue to shape our distinctive business culture, today as well as in the future. Till date, these have been our backbone as we want to be a company on which all our employees and business partners can depend on.

Customer-Oriented:

Our basis for long-term partnership is that we serve our customers to become more successful in their markets – with high-quality brand -name products, customer-specific solutions and with a high service level.

Familiar:

Long-term orientation, warmth and the familiar atmosphere of our family-owned and operated company act against coldness and anonymity.

Innovative:

Everything we do is firmly anchored in constant innovation in order to secure our future.

Success-Oriented:

Orientation toward success, supported by independent action, is important to us for securing our independence and growth.

WCI: Your comments on the Indian Wire & Cable industry

SPK: Recently, some positive traction has been witnessed by the Indian cable sector, with the sector clocking an unprecedented growth of 60 percent due to a 200 percent growth in the control cable segment in November 2011. According to The Indian Electrical & Electronics Manufacturers’ Association (IEEMA), the electrical equipment manufacturing industry has registered a growth of 16.6 percent during Q1 of FY11-12, maintaining almost the same growth as Q1 of 2010-2011. This analysis has been based on growth figures on the production and sales data collected from its member organisations, which represent 95 percent of the entire sector.