PG ELectroplast reinvents itself once again to become a one-stop solutions provider

By diversifying its product range and strengthening its capabilities in design, PGEL is once again ready for change. Its strength has always been to evolve with the new market trends

By Nitasha Chawla

Wednesday, August 14, 2013: From a one-man army to a group with five public limited companies, the journey of the PG Group has been marked by sheer hard work, passion, persistence and determination. A true electronics enthusiast, Promod Gupta, chairman and MD, PG Electroplast Ltd (PGEL), has built the Rs 5 billion conglomerate over four decades by chasing his dreams and utilising his engineering skills to develop revolutionary electronic products in India.

An electronics manufacturing services (EMS) provider for consumer electronic product OEMs in India, PGEL has ruled the television manufacturing market segment for decades and is now fast adapting to the changing technologies to stay ahead. The company has won several awards from its customers, including from LG and Onida, for business excellence in moulding capabilities, quality improvement, innovation and Six Sigma.

The journey so far

Promod Gupta joined the Defence Research and Development Organisation (DRDO) in 1965 as a scientist in its Solid State Physics Laboratory (SSPL) in Delhi. Although it was a satisfying government job, his passion for electronics led him to set up a small workshop on the terrace of his house to make transistors. “I was taking small steps to follow my passion for electronics while doing a job and started off with making radio transistors at home. In 1977, I decided to quit my job and formed a proprietorship firm for making deflection components for black and white TVs under the PG brand,” recalls Promod Gupta.

The company was incorporated in 2003 as PG Electroplast Pvt Ltd. Soon, the PG brand became one of the most preferred for black and white television components by major firms like Beltek, Televista, Singer, Weston and Crown, which were sourcing around 80-90 per cent of their requirements from PG brand. The firm kept on adding more components to its portfolio—turret tuners, mains transformers along with deflection components.

Moving ahead with the times, in the early 90s, Promod Gupta approached OEMs like Onida, offering to make black and white television sets on a contract manufacturing basis. It also opened its first factory in Noida to manufacture TV sets. After that there was no looking back, as the company evolved into a dominant player in the black and white TV market producing half a million TVs every year.

It was again a time for change for the company in 2003 when colour TVs began replacing black and white models. The PG brand was a success here, too. “In the late 90s, new Indian brands like Onida, BPL and Videocon were entering the market with their colour TV sets. We successfully gauged the pulse of the market again and changed our lines to manufacture colour TVs for Onida and Videocon,” shares Promod Gupta.

At that time, the company began backward integration with its foray into plastic injection moulding. This made the PG Group an integrated player in the consumer electronics market, with the capability to do plastic injection moulding, PCB assembly and final integration of the products. Today, PGEL has manufacturing units in Greater Noida (two), Roorkee and Ahmednagar. PGEL is the flagship company of the PG Group, which has four other sister companies engaged in contract manufacturing activities. In 2010, PGEL became a public limited company.

Operating principles

PGEL has grown multi-fold ever since its inception. From just a few technicians at the headquarters to over 1500 employees all over India, the company has grown based on principles like transparency, honesty and quality in service.

“We are objectively a customer-driven enterprise, and we strongly believe in R&D and innovation, which have acted as catalysts for our growth,” says Promod Gupta. Even though PGEL has a structured functional reporting system for every department, with all its factories supported by the HR, finance and purchase departments at the head office, the relationships between employees and the management are fostered like in a family. “We are accessible to all our employees; there is no unilaterality in decision-maiking. We keep a family-like atmosphere. I believe this has helped us in earning the trust and loyalty of our employees, and vice-versa,” shares Promod Gupta.

The company also has a monthly suggestions scheme, where all its employees are invited to contribute their ideas. These suggestions are then tabulated and the best one is incorporated in the company’s work structure. “This exercise is very important for us, as it helps us to understand the organisation from the point of view of those who work here. We also give a ‘Best Operator’ award that is based on customer feedback from all the factories. It not only helps us serve our customer better but also motivates our operators,” shares Vikas Gupta, executive director, operations, PGEL.

What PGEL offers

PGEL manufactures and assembles a comprehensive range of consumer electronic components and finished products, such as colour television (CTV) sets and components, air conditioners (ACs), sub-assemblies, DVD players, compact fluorescent lamps (CFL) and water purifiers for leading brands in India. As backward integration, the company also does plastic injection moulding and manufactures printed circuit boards (PCB) assemblies for CTVs, DVD players, CFLs and water purifiers. PGEL has recently diversified its portfolio to include LED lights, kitchen appliances and is fast adopting LED technology to manufacture TVs.

Some stumbling blocks

Although the PG Group quickly adapted to the technological shifts in the market, it had to face several challenges. In 1978, when Promod Gupta decided to make deflection components for TVs, he had very little capital to buy the imported machines. However, he didn’t lose hope and put his engineering skills to work to make a machine himself. “The machines we needed were very expensive and had to be imported from Germany or Japan. Therefore, I decided to fabricate them myself and I got the machine made by assembling its different parts from local steel vendors, as I had a fair idea about the imported machine, its specifications and design.”

Another blow was when key customers like Weston and Televista began facing negative growth in the early 90s. Since the group was concentrating only on making components for these companies, it was a time for it to reinvent its portfolio. “The early 90s was a period of intense anxiety for us. Our key customers were becoming sick and our payments were getting delayed. Therefore, we had to change our product line to remain competitive in the market, within a very short span of time. That is how we entered the market for black and white TVs,” shares Vikas Gupta.

Future outlook

Over the years, PGEL has built up manufacturing as its core strength. However, the company now plans to strengthen its design capabilities as well. “Every 4-5 years we have to reinvent ourselves. We are now working towards offering design services, especially in the LED lighting segment, to our customers. By doing so, we will become a one-stop solutions provider to our customers for all their needs. We believe that the LED lighting segment will be a growth engine for us in the future.”

PGEL’s other plans include developing its own tool designing and tool making services for the plastic injection moulding business. “We will give the complete solution—in that way, there will be more value addition from our side,” says Vikas Gupta.

Apart from that, PGEL aims to become a significant player in the LED lighting business, build its capabilities in kitchen appliances and establish itself again in the TV market with the new LED technology. “This year is one of course correction for us since our cathode ray tube (CRT) TV business has come down. We have supplemented it with our kitchen appliances line. We are putting up a motor manufacturing line for that. However, we have taken a small step in the LED segment and will start making LED monitors for HCL from next month. In the next three years, we aim to grow at 20 per cent CAGR,” says Vikas Gupta.

KEY FACTS AT A GLANCE

LIST OF MACHINES in PGEL facilities

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