Thursday, December 18, 2014: Delta Electronics is an EMS player providing complete lighting solutions to OEMs. The company has had a strong presence in the CFL market. Its manufacturing facilities, located in the state of Uttaranchal, are spread across 11,000 sqm. Keeping up with the evolving technology and fast changing trends in the sector, the company is now focusing its attention on its LED division. Recently, the company launched its new LED brand, Orkus. In an interview with Richa Chakravarty of LED Bazaar, Arun Bhatia, president, LED business, Delta Electronics, talks about the company’s research and designing efforts undertaken to develop LED products for its OEMs, as well as its expansion plans and strategy, going forward.
LB: How does Delta brand itself?
Delta is an electronics manufacturing services company. Besides our CFL business, our focus is on the developing LED market, and Orkus is the new brand that we have launched for this segment. Our main priority is to develop products for our OEMs. At the moment, we are test marketing these products, as we feel that before launching a product, you need to understand the market for it too.
LB: Do you have any plans to launch these brands in the market?
Right now we are test marketing the products. We are giving out samples to all the leading OEMs for testing. Once they do that and adopt these for their brands, we can manufacture the products in bulk to have the advantage of volumes. So, at the moment, we are focusing on sampling, understanding consumer requirements, exploring the LED market, perfecting our product for the Indian market, etc.
LB: What are the innovative solutions that Delta is offering the LED industry?
New things are happening all the time in this domain, and they will continue to happen. There is a very rapid pace of development going on at the LED end. In residential areas or homes, 7W LED lamps are replacing 60W incandescent lamps. Today, the meaning of wattage is also getting blurred. Earlier, a 60W lamp was replaced by a 9W LED lamp, but today it’s replaced by a 7W lamp. That is the kind of innovation we are experiencing across the industry. We have been concentrating on bulbs. We have both small output and high output lamps.
LB: What are the latest R&D initiatives taken by Delta?
We have been continuously working to develop our new products. We have achieved a power factor of over 0.95 for LED bulbs. We have tried to make the light as uniform as possible. We have achieved a life span of over 25,000 hours. The second area in which we are developing products is the tubelights segment. We make T8 tubelights that are available in three models—the first is made up entirely of plastic, the second is made up of glass and the third model is half aluminium and half plastic. As OEMs, we need to offer a wide variety to meet our customers’ demands. Hence, we have both high lux as well as high lumens products.
LB: What are the technical challenges you face and how do you resolve them?
The main challenge that we have to work on all the time is: how to make products with the latest technology that can perform better, but are also more cost effective. Speed to market is another challenge we face. We are constantly working on how fast we can understand the latest technology, convert it into a viable product and offer it to our OEM customers, who in turn take it to the market at the earliest. So, reducing the entire product cycle time is the biggest challenge we face.
LB: Which of your two lighting divisions, CFL or LED, adds more to your annual revenue and what do you forecast?
For 11 years we have been nurturing the CFL business and currently, revenue from that division is to the tune of Rs 4000 million. We have been in the LED business for the past one year; and we are working aggressively for growth and expansion. Within the next five years, I believe Delta’s revenues from its LED business will equal what it earns from the CFL business.
LB: Which segment within the LED lighting market is picking up in India?
The LED market in India is lagging far behind the global market. There are three segments in this market—residential, outdoor and the commercial market. So far, adoption and penetration in the commercial segment (including the government sector) has been fast. The bulk or volume purchases come from this segment. The residential segment has been slow but the government is trying its best to popularise the technology here. There are a few initiatives, under which the government is selling LED bulbs through subsidised schemes and low prices so that the common man too can enjoy the benefits of the latest technology and contribute towards energy conservation for the benefit of the nation. It is trying to boost the market in this way. Use of LEDs is a win-win situation for everyone—for manufacturers, consumers and the society at large (due to the use of energy efficient products).
LB: Does Delta design or develop its products for the Indian or the global markets?
Our first priority is the domestic industry. So, we are catering to the industry closer home but we are keeping track of the global market too. In our second phase of growth, we plan to look at the global market and players.
LB: What are your expansion plans?
We are manufacturing LED products from our Kashipur plants with an installed capacity of 1 million units per annum. We are now commissioning our new plant in Noida with an additional capacity of 1 million units per annum.
LB: What is your current manufacturing capacity, and once your new facility is commissioned, how many units will you scale up to?
Presently, we are manufacturing 5 million units of CFL bulbs per month. With this new facility our LED capacity is doubling to 2 million units per annum, a level we plan to maintain for the first year, and then scale up further.
