rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » From fridge, TV to mobiles, Samsung's big success in India

From fridge, TV to mobiles, Samsung's big success in India

Last updated on: November 07, 2014 11:51 IST

 

Samsung has been facing competition from local mobile handset makers like Micromax, Lava and Karbonn but it has maintained its lead in smartphones.

When it first set up shop in India in 1995, Samsung Electronics was a consumer electronics giant that gave local manufacturers a run for their money in televisions and refrigerators. 

Two decades later, Samsung has become a mobile handset company that also has presence in consumer electronics.

In the financial year ended March, 69 per cent of Samsung's revenue in India came from mobile phones, almost double of what it was in the year ended March 2010.

In 2009-10, mobile phone sales contributed 39 per cent to Samsung's India revenue, which went up to 46.5 per cent the next year, 55.5 per cent in 2011-12 and 64.7 per cent in 2012-13.

In 2013-14, the South Korean giant sold mobile phones worth Rs 27,912 crore (Rs 279.12 billion), about 60 per cent of India's Rs 45,000 crore (Rs 450 billion) mobile handset market.

Samsung's Indian revenues in 2013-14 were Rs 40,392 crore (Rs 403.92 billion), according to a filing with the Registrar of Companies (RoC).

Samsung's earnings from audio-visual products, about 30 per cent of its India revenue in 2009-10, tumbled to just 10.8 per cent in 2013-14. 

In absolute terms, the segment revenue grew to Rs 4,372 crore (Rs 43.72 billion) in 2013-14 from Rs 3,276 crore (Rs 32.76 billion) in 2009-10.

Home appliances, which accounted for 30.6 per cent of Samsung's 2009-10 revenue in India, now contribute just 12.8 per cent.

The segment revenue has grown from Rs 3,273 crore (Rs 32.73 billion) in 2009-10 to Rs 5,196 crore (Rs 51.96 billion) in 2013-14.

The growth in handset sales has made the South Korean company dependent on one of the world's fastest growing cellphone markets at a time its global revenue from mobile phones has been declining.

In the third quarter of 2014-15, Samsung's revenue from information technology products and mobile phones, which typically account for a third of the company's global earnings, tumbled 33 per cent. 

Samsung does provide a break-up of its earnings from information technology and mobile phone businesses.

Samsung has been facing competition from local mobile handset makers like Micromax, Lava and Karbonn but it has maintained its lead in smartphones.

Revenue from information technology products, a marginal contributor to Samsung's India earnings, dropped from Rs 927 crore (Rs 9.27 billion) in 2012-13 to Rs 475 crore (Rs 4.75 billion) in 2013-14. It contributed Rs 359 crore (Rs 3.59 billion) in 2009-10. 

Revenue from software development and exports grew to Rs 1,055 crore (Rs 10.55 billion) in 2013-14 from Rs 700 crore (Rs 7 billion) in 2012-13 and Rs 186 crore (Rs 1.86 billion) in 2009-10.

Samsung's net profit in India jumped about 54 per cent to Rs 2,636 crore (Rs 26.36 billion) in 2013-14 from Rs 1,714 crore (Rs 17.14 billion) in 2012-13.

It made a profit of only Rs 40 crore (Rs 400 million) in 2009-10.

 

Profitability jumped from only 0.37 per cent in 2009-10 to 6.52 per cent in 2013-14, without considering any external factors the company might have included in its accounting.

Photographs, courtesy: Samsung

Sounak Mitra in New Delhi
Source: