This entrepreneur quit his CA course, built a TV ODM business with Rs 600 Cr turnover
Ekkaa Electronics was established in 2019 to manufacture televisions for Indian companies. In four years, the company works with 100 brands and has reported a turnover of Rs 600 crore in FY 22-23.
Monday January 09, 2023,
5 min Read
Sagar Gupta was pursuing his articleship in 2017 when his father, CP Gupta, thought of pivoting his existing business. The senior Gupta decided to move from semiconductor trading, which he had been doing for the last three decades, and become an Original Design Manufacturer (ODM) for LED televisions.
Prime Minister Narendra Modi’s ‘Make in India’ initiative in 2014 gave a huge fillip to manufacturing businesses in India, and was one of the reasons that CP Gupta decided to pivot despite the risks - a completely new domain and the need for hefty investment.
Speaking to SMBStory, Sagar says he wanted to get into core manufacturing even while he was studying for his CA exams, and what could have been better than joining hands with his father?
In 2019, after doing the much-needed groundwork, the father-son duo joined hands to start Ekkaa Electronics in Noida.
“Starting up in the manufacturing industry was not a challenge since my father had prior contacts from the time of his trading and distribution business. We were then catering to brands like Samsung, Toshiba, Sony etc, and had the knowhow of how the ODM industry operates,” Sagar says.
The experience came in handy but what excites the father-son duo the most is the fact that they are building a base to strengthen TV manufacturing, a sector where China is the major player as of now, in India.
Despite the pandemic-induced lockdowns and supply chain disruptions, Sagar claims the company made a turnover of Rs 600 crore as of FY 22-23. It has more than 100 brands in its portfolio and is now aiming to work on optimising costs to be able to supply to the world.
Making in India for the world
designs and manufactures smart LCD TV, LED TV, 4K 2K TV, and other TV products with sizes ranging from 24″ to 40″.
Sagar did not disclose brand names but says the company is working with more than 100 brands that are catering primarily to Tier II and III markets of India.
Talking about the pace at which the company has grown, he says, “We are an ODM and not an OEM company. Our advantage is that we control our whole supply chain. We purchase our own product, design, and control packaging and labelling.
“We solve brands’ problems of huge working capital involvement, product consistency, timely availability, and reduce overall uncertainties and risk.”
According to Grand View Research, the India smart TV market size was valued at $1.42 billion in 2020 and is expected to expand at a CAGR of 16.8% from 2021 to 2028.
The demand in the market is huge, and CP and Sagar are capitalising on the growing opportunities by tapping their existing relationships with consumer brands.
Ekkaa manufactures more than 1 lakh TVs per month now and the vision is to backward integrate as much as possible. To date, the company has sold around three million TVs.
“We cannot manufacture everything in India…To achieve economies of scale, one should not do everything alone. We are trying to do as much backward integration as possible to optimise costs,” Sagar says.
China is one of the largest producers of televisions in the world and Sagar says they will be able to compete with the Red Dragon if Ekka Electronics can reduce costs through backward integration. Then, “we will be able to make televisions for the world”.
The market and way forward
Government initiatives like adding custom duties to finished products, schemes for promotion of capital investment etc, primarily in Tier II and Tier III cities, are among the key factors likely to bolster the growth of the smart TV market in India.
However, Sagar says market volatility is one of the biggest challenges.
“With demonetisation, GST, and now COVID, there’s been a lot of uncertainty in the manufacturing sector. Each COVID-19 wave was treated differently by people and even by the government, so the challenge crops up with these precarious situations,” he says.
On future plans, he says the company plans to set up a new state-of-the-art facility in Noida, which is currently the heart of India's electronics manufacturing ecosystem.
“This will be among the most technologically advanced plants in the world and will be the highest capacity plant for LED TVs in India, allowing us to manufacture one million TVs per month. The backward integration and highly sophisticated equipment will help us manufacture core components required in LED TV and commercial displays,” he says.
Economies of scale will enable the company to “fulfil requirements of major Indian market and also export the product to the world”.
Ekka Electronics also has plans to expand to consumer durables, and wants to add washing machines, multimedia speakers, smart watches, and TWS to its product portfolio.
Unlike peers like Dixon and Videotex, Ekkaa Electronics does not want to launch its own private label. “We want to have expertise and be known for one thing. I believe, if you make everything, you can’t make anything. Focus on the core is important.”
Edited by Teja Lele