The need for high-speed internet increased during the coronavirus pandemic, helping demand for cables and fibre optics—a trend that helped Finolex Cables’ business.
One downside of such business is high prices impacting volumes. “Last year, we saw volume movement in the last quarter (Q4) and that has now crossed pre-Covid levels. We are back up and higher than previous years in volumes,” Deepak Chhabria, executive chairman, Finolex Cables, told ‘Business Standard’.
Chhabria said demand for products like LAN cables increased as people worked from home in the pandemic and need internet speed. “Fibre optics, LAN cables, or copper line cables saw good demand. We have expanded our LAN cables capacity last year by 20 per cent and presently we have a capacity of 1000 kilometres per month. We even went ahead and expanded our portfolio,” Chhabria
Chhabria said the company expanded its electrical-wires capacity from around 20 lakh coils a month to around 24.5 lakh.
In fibre optics, the company has installed new technology which has caused the line speeds to increase. The company is also focused on 5G for growth and is ready with 5G products in fibre optics.
“We are also looking because of the world demand and fibre optic to boost exports in fibre optic cables. We are trying to have our export team focus on that and we should see some results,” Chhabria said.
In FY22, the company spent Rs 200 crore on expanding its lines compared to the approximate Rs 100-150 crore it typically spends on expanding its line.
In the consumer durable space, the company plans to introduce a line of clothing irons by the end of May. It is working on increasing its range of products. In order to increase the reach of its products, the company has moved from a single tire network where Finolex (Cables) was selling to channel partners and then it moved to a dual tire model which includes a distributor and a retailer.
“We’ve added 600 distributors, and about 140,000 retail counters, this expansion continues, not only helps the wire and cable, but all these new product lines require this kind of a distribution network to be successful, Chhabria said.
Finolex Cables also intends to double its revenue from exports to Rs 100 crore from less than Rs 50 crore. “The government is doing a great job in signing FTAs so we are trying to now focus on markets where the FTAs are getting signed in order to get a duty-free entry and then we could try and enhance our export,” Chhabria said. Business Standard