LAPP GROUP : The legendary heritage of excellence
Q. LAPP INDIA being one of the leading manufacturers of electrical cables in India has established its brands in the market over the decade please brief its journey towards this milestone & share some of its achievements?
Our success story began with Mr. Andreas Lapp, who in 1959 identified the need for branded cables in the unorganized sector. The flagship brand öLFLEX® recently celebrated its 50th year. Today, the Lapp brand is a byword for competence, quality and innovation all over the world. LAPP INDIA strives to be a partner for its customers for high performance cabling solutions. A 100% subsidiary of the LAPP GROUP, we are leading providers of cables, wires and cable accessories. In India we began operation in 1996, with its first manufacturing unit in Jigani, Bangalore. The Bangalore facility produces world-leading quality products for the Indian market. We operate through a trained regional marketing organisation in Delhi, Kolkata, Mumbai, Pune, Bangalore and Chennai with 23 sales offices and a strong network of dealers throughout the country. Our family has grown to more than 250 employees. LAPP INDIA has been riding on a growth trajectory, with a growth of 23% as compared to last year. LAPP INDIA clocked a turnover of Rs. 300 crore during the financial year (Oct 2010 – Sept 2011) and a turnover of Rs. 368 crore during the past financial year (Oct 2011 – Sept 2012) and plans to achieve Rs 10bn by the next three years. We have successfully completed the set-up of Phase 1 of our second Indian manufacturing facility in Pilukhedi, Bhopal and currently it is operational. The 4-phased construction is planned to be completed over a period of 5 years, post which the Bhopal facility will be LAPP GROUP’s largest facility globally, effectively catering to the growing domestic demand. This unit is the first facility outside Bangalore and with this expansion we aim to cater to our customer in the northern and eastern parts of the country.
Q. How about LAPP INDIA’s initiatives in electrical cables space? Which are your focus areas?
As far as the electrical cables space in India is concerned, higher efficiency and productivity has been witnessed in the businesses. There is a strong focus on value engineering and quality product development. We are looking at offering customers high performance, quality cabling solutions to help them meet their manufacturing output and improve efficiency. We are working by example, by implementing Lapp Operating System. (LOS) a global initiative taken by the parent company to enhance efficiency of operations in all its manufacturing plants and sales organisations of which India is a significant contributor. This methodology will enable the enterprises to manufacture products and services for the customers within shortest time, by eliminating redundant activities involved in manufacturing and support functions. We are focusing on verticals like Renewable, Building Solutions, and Instrumentation cables for Process industries by offering customized cables relevant to the respective domains while communicating the need for quality cabling solutions for these industries.
Q. What are the market opportunities for LAPP INDIA’s products in India?How do you plan to position these products?
We see opportunity for all our products more specifically; there is the need for customized cables for different vertical. These cables can address the nuances and requirement of that industry and contribute to efficient operations. LAPP cables have large popularity in the machine tool industry, automobile sectors and our flagship product öLFLEX ® is popular across the industries. This year, we are increasing capacity to focusing on verticals like renewables, building solutions and instrumentation cables for process industries. We are also turning the spotlight on fibre optic cables with the brand HITRONIC®. These glass fibre cables are primarily used in the telecommunications sector, as well as anywhere large amounts of data are generated, extreme ranges are necessary or dangerous showers of sparks need to be prevented. Our customized cables have relevance in every domain, this coupled with quality we predict strong sales in the coming year.
Q. Can you please elucidate the contribution of R&D in the success of your products?
Being part of the global conglomerate we have the privilege of relying on our parent company, Lapp Group for our R&D requirements. The German efficiency and quality of our products is well acknowledged giving us an edge over the others products and worked to our advantage. We are a research centric company that is at the helm of innovation and always focused on creating new applications that cater to newer markets. LAPP has recently launched two new versions of its connection and control cables, öLFLEX® Classic 110 and Smart 108, both tried and trusted names for over 50 years promising greater versatility, performance and efficiency. Unlike its predecessor, the latest öLFLEX® Classic 110 has an expanded temperature range stretching from -15°C to 70°C, and can even withstand up to -40°C when permanently laid. As a result, it can be installed during the cold winter months, thereby helping to cut costs. Efficiency and sustainability are the hallmarks of öLFLEX® Smart 108. In an environmentally friendly solution that also helps to keep costs down, the inner layer of the outer sheath is made of recycled PVC reclaimed from in-house manufacturing processes.
Our R&D center conducts testing and designing to develop products that can address connectivity requirements for number of industries. To name of few, products that have seen success already in the market, first is the counter nut with 360 degree shielding. This is a plastic cable entry with 360 degree EMC shielding that off ers a lighter, simpler and more flexible option. Second,The HITRONIC® HQN 1500 Outdoor Cable and HITRONIC® HVN 5000 Outdoor Cable have been redefined for remote data transmission. They can now be laid directly in the ground and are particularly hard-wearing. Thirdly, the EPIC® DATA CAT.6A 10G field-configurable connector, designed for the higher bandwidth requirements of 10 gigabit Ethernet and for transmission frequencies of up to 500 MHz in industrial and building networks. Fourth, is the new is the UNITRONIC® LAN 1500 CAT.7A LAN cable for structured building cabling in horizontal surfaces, for example in a floor level with improved output of up to 1500 MHz. Furthermore, it complies with the EN 50173 and ISO/IEC 11801 standards.
Finally, LAPP will also be presenting LAN cabling solutions for outdoor installation. The UNITRONIC® LAN OUTDOOR CAT.7 comes in two versions: for laying directly in the ground or for laying outdoors between two buildings. Both designs are UV-resistant, and the version with the polyethylene-aluminium-coated sheath also has a diffusion barrier. LAPP is also innovating in terms of wiring, we have has also come up with a comprehensive product programme for fieldbus technology. Lapp has made it easier for customers to upgrade to more economical fieldbus technology with its AS-Interface BUS cable range.
Q. What is your marketing strategy for Indian market?
We are planning to gear up to meet India’s growing domestic needs. The Bangalore plant is nearing its full capacity so the plan is to invest in expansion of the Bangalore plant. Also, we are planning on making India the hub for marketing the company’s products in the SAARC region. Further the tier-II and III cities have been developing vigorously and we have been witnessing good demand from these regions. Hence we are focusing our efforts on exploring the market potential in these regions by educating buyers about the significance of quality products as opposed to the low-priced sub-standard products. We have embarked on augmenting our customer service and the way we respond to customer requirements. Additionally, we have introduced a single hotline for customers to get in touch nationally. We are learning how to improve ways to respond to customer requirements across the globe. To win a competitive edge over the players in the field we believe in delivering unbeatable quality and our excellent logistics enables supplies to reach in the shortest time.
Q. Brief us about the quality policy for your business?
As mentioned earlier, we follow the globally acknowledged VDE Standards that are harmonized with IEC (International Electric Commission) and are more stringent than the IS (Indian Standards), generally followed by majority of the cable manufacturers in India. The VDE mark confirms compliance with protective requirements ensuring maximum safety and reliability. Also, our employees are highly qualified some of them have received their training in Germany and at least 60% of them have served for more than five years in the company.
Our state-of-the-art infrastructure in manufacturing facilities and adherence to highest safety standards has earned our manufacturing plant in Bhopal an ISO 9001: 2008 certification on March 22, 2013, recommended by TUV India, VDE and IEC certification for HO5-VK and HO7-VK for a range up to 6sqmm and IS 694 extension certification for producing FRLS wires up to 6 sqmm. In addition to this, Bangalore plant has been awarded IEC certification for HO5-VK and HO7-VK for a range up to 240sqmm. This is definitely a motivation that we have to harness to achieve our present and future goals.
Q. Please highlight the Indian & Global perspective of electrical cable industry?
As cabling is a necessary component across industries, manufacturers produce multitude of cables ranging from power cables, fire safe cables, single cores, multi cores and data cables. According to Global Industry Analysts, Inc the wire and cable industry is expected to generate USD 113.9 billion by the year 2015. In India, the wire and cable industry has moved from unorganized to organised over the last 20 years. However, 35% of the industry is still in the unorganized sector.
There are multiple players in the market, including Indian as well as International providers. The Indian market consists of both branded and unbranded cables. Cables and wires are also imported from other countries to meet the ever growing requirement. The wire and cable industry comprises 40% of the entire electrical industry, which is expected to double in size over the next five years. More specifically, the domestic electrical equipment industry reported a 6.6% growth in FY12, as compared to 13.7% in 2010-11. Sluggish growth in power sector and escalating imports of electrical equipment is impacting the commercial viability of domestic electrical equipment industry. However, we are optimistic with sustained and efficient production the industry will be able to recover in the upcoming quarters. We can expect the market to grow between 5-10% in the next 2-3 years. However, I do hope that beyond the 2-3 years the market grows by 15-20%.
Q. What are the key technological trends that are driving electrical cable industry?
Around 35% of the cable and wire industry is controlled by the unorganized segment where quality is often compromised. The organized market however is favoring more quality products leading to the influx of foreign MNCs into the Indian market. The growth of vital segments like nuclear power, mining, petrochemicals, renewable has led to the greater emphasis on Specialty cables leading to a significant market opportunity for these MNCs. Specialty cables call for increased spends in R&D which results in increased investments creating a positive traction for the cable industry going forward. Compound research seeks great attention when we talk of latest technological trends in the industry. Developing compounds that can survive extreme conditions, last longer, compounds that are easily available, cheaper, reusable has occupied an integral area of focus in the cable industry.
Q. What are the issues you need to address that are related to electrical cable industry?
Educating customers about the existence of important certifications such as ISI, product certification from BIS etc is highly important. The VDE standards are harmonized with IEC (International Electric Commission) and are more stringent than ISI. Non adherence of standards can be quite disastrous. Especially with reference to the numerous fire accidents that are caused due to faulty cables/wires used in India today. The quality of insulation material used in most cases is questionable. The material is not flame retardant (FR) which is a property of the insulation to check the spread of fire. Flame Retardant and Low Smoke (FRLS) Halogen Free Flame retardant (HFFR) wires can be quite useful to minimise fire accidents. FRLS PVC is a special grade PVC which limits the amount of smoke that is generated when the wire catches fire and at the same time is self extinguishing. Adoption of modern manufacturing technology for wiring systems is important so as to cater to safety aspects in this high growth market. The influx of global players has led to tough competition in the market. There is a pressing need for young dynamic talents in the industry to build up the momentum. To cater to the changing needs of the industry we have a strong emphasis on constant training, performance management, recruitment and retention program to meet the significant parameters speed, reliability and quality that play a very important role in running a smooth business.
