Salzer’s electrical solutions portfolio is almost complete with wires and cables contributing 46 percent to its total revenue. The company’s growth to six times its size 10 years back, both in sales and turnover, is absolutely remarkable.
Incorporated in 1985 and headquartered at Coimbatore, Salzer over a period of time has become a notable manufacturer of switchgears, wires and cables, and building segment products. The company’s electrical products are marked for its quality and of late have created a strong market both in India and overseas. With four state-of-the-art manufacturing plants, laced with latest technology, Salzer’s vision is to become a global electrical solutions company, admired widely for its people, performance and values.
Salzer’s activity spans over the period of over 30 years in producing some of the most sought after products in the electrical industry, making it one of the India’s leaders in rotary switches and wiring ducts. Its wire and cable segment is also getting increasingly recognized by the market owing to its quality control policy and utmost adherence to both national and international standards. Salzer’s in-house R&D facility, engaged in constant product development and upgradation, is recognized by the Department of Scientific & Industrial Research, Government of India. Wire and cable India recently had a brief interaction with Mr. Rajesh Doraiswamy, Joint Managing Director, Salzer Electronics Ltd. Mr. Rajesh expressed how Salzer proposes to be the provider of total solutions in electrical installations. Excerpts:
Wire & Cable India: Salzer has been growing briskly at the rate of 12.5 percent y-o-y. What has made Salzer grow at such a rate?
Rajesh Doraiswamy: Yes, we have grown about six times in the last 10 years, both in sales and profits. At Salzer, we have always been conscious of the quality and have tried making products that meets international standards. Salzer ensures the product it designs and manufactures, must be capable of competing not only in Indian market, but in the world market too. This focus has always kept us ahead of the curve in India and has helped the company during the economic slowdown. Secondly, we have also consistently brought to India various new technologies through partnerships and also consistently introduced new product ranges. This has helped us grow consistently over the last several years.
WCI: How much do you think the wire and cable segment has contributed to the robust growth?
RD: Wire and cable business was added to our product portfolio only in 2007. From then on, the wire and cable business has grown at a very healthy pace. Today, wire and cable business contributes around 46 percent of our total revenues.
WCI: You have such a wide product portfolio. Share with us the entire range, and also tell us the percentage, wire and cable division forms.
RD: Salzer’s business consists of four major divisions, namely switchgear products, wires and cables, building segment products, and energy management division. Switchgear division comprises more than 15 products including our flagship cam operated rotary switches, toroidal transformers, isolators, connectors, contactors, relays, wire ducts, and wire harnesses.
Wires and cables division consists of building wires, industrial flexible wires and cables, multi-core cables, and UL approved wires. Building segment products are switches, MCBs and distribution boards. Energy management division offers street light management solutions. As informed earlier, wire and cable segment contributes 46 percent of our topline.
WCI: Can you share with us each segment’s contribution to revenue individually, especially wire and cable?
RD: Wire and cable contribution is second highest after switchgear’s. Switchgear and cable contribute 46 percent respectively in the company’s revenue, while building and energy segments’ contribution stands at 5 and 3 percent respectively.
WCI: Do you have any expansion plan on the product and process sides?
RD: Product addition is a constant work at Salzer. Though we are not planning any immediate major capex, there are a lot of new product developments going on and Salzer hopes to launch them soon.
Among some of the notable recent product developments are the three phase dry type transformers in technical tie-up with Trafo Modern, Austria and automatic changeover-cum-current limiter (ACCL) for apartments and residences. Besides, MCBs and DBs for building segment, motor protection circuit breaker, and solar cables are other additions in our portfolio.
WCI: Please tell us something about Salzer’s manufacturing units.
RD: Salzer has four world class manufacturing units in Coimbatore. Two plants are dedicated to manufacturing of switchgear products along with two plants are for wires and cables and for building segment products.
We have a large complex dedicated to manufacturing wires and cables. We are having plans to expand shortly the wires and cables facility by adding more machinery to augment the capacity.
WCI: Besides India, which are your major markets?
RD: Salzer’s brand is already known in more than 40 countries. We are selling our switchgear products to countries like USA, UK, Canada, Germany, Italy, Poland, Malaysia, Thailand, Vietnam, UAE, Australia, and many other countries. At present our export revenue is around 20 percent of our total revenues. We continue to focus on export markets and grow the export business. Our focus for the next two years will be the African markets.
WCI: Lastly, our readers would like to know about your perception related to the Indian wire and cable industry. What future do you think the industry has in the coming 10 years?
RD: Wire and cable industry in India has come a long way from being a small and fragmented business to a large, consolidated, and growing industry. Today, India boasts to have some of the world’s large companies in wire and cable sector. Thanks to Bureau of Indian Standards (BIS) issuing the ISI mark to all wire and cable manufacturers on compliance of minimum qualification criteria! As a result, the quality of wires and cables has improved substantially and today we can see various companies exporting products to developed countries.
Strict monitoring and compliance of qualification criteria by BIS before issuing ISI mark to wire manufacturers has removed all the low quality manufacturers from business and made the product much safer. Wire and cable forms a major part of electrical equipment, automotive and building segments. The consumer now enjoys the right for safe and quality products.
The main customers for the wire and cable industry are the automotive, telecommunication and construction industries. These three sectors have witnessed a rapid expansion and have led to an annual growth of about 15 percent in India until 2020.
Wire and cable industry have been growing at a CAGR of 15 per cent, boosted by momentums in the power and infrastructure segments. As per various research figures, the present estimated per capita consumption of copper is only about 0.5 kg. The world average per capita consumption is around 2.7 kg. So, we can see the potential of growth in India. With various initiatives that Govt. is focusing on such as ´Make in India´, the industry can grow at similar rate for at least the next five years. The future growth of the wire and cable industry is promising as we see that the growth in next generation industries like renewable power, metro rail, electric vehicle etc. will further boost the demand for wires and cables.
