Ekka Electronics to invest Rs 1,000 crore in 3 years to set up new facility in Noida
Consumer electronics company Ekka Electronics on Wednesday said will investing Rs 1,000 crore to set up a factory in Noida, Uttar Pradesh and enter into the manufacturing of products such as washing machines, smart watches, hearables and TWS (true wireless stereo).
The Noida plant, in which the company would invest Rs 400 crore by July this year on the acquisition of land, equipment, construction of the facility etc., will house a complete backward integration and in-house design and manufacturing solutions, said its director Sagar Gupta. The plant will manufacture TV and other products such as washing machines, smart watches, hearables and TWS. At present, the company has a setup at Sonipat, Haryana for manufacturing of LED TVs up to 43 inch screen size and set-top-boxes.
“In the new plant, we would manufacture LED TVs from screen size of 43 inches to 90 inches, which is currently based on imported components and assembling. We are planning to manufacture those imported components here,” said Gupta. The company is planning to set up SMD machines for manufacturing motherboards, injection moulding machines for plastics and power bressel machines for mettle parts at the Noida plant, which is expected to be functional in August after the completion of the first phase. It intends to become an ODM (original design manufacturer) from being an OEM (original equipment manufacturer), which are dependent on respective brands for materials. It plans to have its own value system with supply chain, product development to labelling etc, reducing the supply time to its b2b customers.
“The new facility at Noida will have an initial capacity to manufacture 500,000 units of LED TVs per month, which will make the plant the largest facility in terms of capacity in the country with the potential to ramp it up to 800,000 to 900,000 units per month in the next three years,” added Sagar Gupta. To begin with, the new facility will have a workforce of 1,500 employees with plans to ramp it up to 3,000 over three years. When asked about the current turnover, he said for the financial year ended on March 31, 2023, Ekka Electronics had a revenue of Rs 600 crore.
Regarding the modalities for funding of the investment, Gupta said for the first phase, in which it is investing Rs 400 crore, is financed through a mix of debt from banks and financial institutions and internal accrual from the company. “We can also go for private equity,” said Gupta, adding that after 3 years, it has also plans to go public and launch an IPO. The remainder of the investment will be spaced out over six months towards R&D, machinery and others. With the new plant, it is also looking at the export market, where it is targeting the Middle East and Africa market. At present, Ekkaa’s manufacturing unit at Sonipat produces LED TVs with a capacity of 1.5 lakh units per annum.