Desai Electronics opens new facility, doubles installed capacity

With a view to meet the increasing demand from the domestic sector and to reduce the import of capacitors, Desai Electronics has expanded its manufacturing capability

By Richa Chakravarty

Monday, December 23, 2013:  Desai Electronics Pvt Ltd (DEC) inaugurated a new manufacturing facility in Pune in October 2013, doubling its installed capacity to 400 million capacitors per year. From a capacity of less than one million per year to the manufacture of more than half a million capacitors per day, Desai Electronics Pvt Ltd (DEC) has come a long way.

Established in 1981 by Vikram M Desai, DEC manufactures plastic film capacitors. One of the majors in the electronic components industry, DEC has been operating at almost full capacity, barring some ups and downs in the market or seasonal fluctuations. From a turnover of Rs 0.5 million in 1981, today the company has grown to Rs 490 million (2012-13). “The demand for capacitors has grown exponentially, yet about two-thirds of the capacitors consumed in India are imported. Over the last three decades, we have grown significantly. Our customer base has also grown manifold. To cater to this demand and the growing potential market, we are expanding and setting up a new production facility,” says Vikram Desai, managing director, DEC.

DEC has been a market leader in the capacitors used for fan regulators, but now the company has entered into other application areas like lighting and energy meters. It holds more than 60 per cent of the fan regulator market in the organised sector. And in spite of having entered the lighting segment only recently, it has captured a market share of about 10 per cent.

Manufacturing capacity and infrastructure

DEC’s new manufacturing facility is located at the same premises as the old one. Spread over an area of 3000 sq m, the new facility houses automated equipment like winding machines, lead welding machines, powder coating machines, box encapsulation machines, automatic testing machines, etc. “Pune was our first choice for the new facility as it is an electronics hub. Also, housing it at our existing premises is an advantage as we can cut down on the logistics and transportation costs, while management also becomes easier. Besides, we have now fully utilised the land around our existing facility,” says Desai.

The total investment in the new facility is Rs 160 million, with Rs 35 million spent on building whereas, Rs 125 million spent on plant and machinery. About 15 per cent of the machinery is yet to be installed.

Following the best manufacturing practices

DEC ensures all manufacturing processes are validated for compliance with specifications through inward, in-process, final inspection as well as surveillance audits. Quality management systems are implemented as per ISO 9001:2008.

Process consistency and overall effectiveness is monitored through regular internal audits, management reviews, etc. With an emphasis on continual improvement, DEC uses methods like SPC, 5S, Kaizen, 7 QC and Six Sigma.

To reduce production costs, DEC has automated many production processes, which has increased productivity and resulted in cost reductions. DEC’s state-of-the-art machines have a high process capability and its trained manpower ensures optimised manufacturing and minimal wastage of raw materials.

The environment in DEC is conducive to learning on a continual basis. The management believes in developing in-house talent and provides several growth opportunities.

Sources at DEC claim that its plant has the highest level of automation in the world, within the capacitor industry. All the raw materials used for manufacturing its capacitors are RoHS compliant. DEC is also in the process of getting EMS certification.

Growth strategies

DEC has been growing at an annual rate of 30 per cent and in the next two years, the projected growth is around 40 per cent. At present, DEC’s objective for the next two years is to fully utilise the installed capacity. “Installation is easier than ramping up, as it takes time. Getting the orders and ramping up the production to meet the demand is what we will be doing in the next two to three years,” says Desai.

The sole objective of the company is to reduce the import of capacitors into India. Besides, the company will also compete with other brands in this space. “We also have plans to export, but only after meeting domestic demands. There is a good export potential for capacitors used in fan regulators,” Desai says.

DEC is also supportive of the new government policies to strengthen the electronics manufacturing base of India. It has recently invested in the upcoming electronics manufacturing cluster on the Pune-Bengaluru highway. The cluster is spread over 40 acres of land and is in an advanced stage of development. It includes 25 companies that have already paid part of the costs towards acquiring the land and have approached the government for further permissions.

Electronics Bazaar, South Asia’s No.1 Electronics B2B magazine