According to the Wall Street Journal, Panasonic Corp. (PC), a leading manufacturer of electronic and electrical products, systems and components in Japan plans to provide electronic parts for a car such as car audio related equipment and liquid crystal display (LCD) panels in India. The company plans to more than double its sales in India and aims to reach a sales target of $1 billion by the fiscal year ending March 2013.
Panasonic has been continuously increasing sales of consumer products through increased focus on priority countries such as Brazil, Russia, India, and China (BRIC) and Vietnam. Similarly, taking advantage of the booming car market in India Panasonic decides to sell car related items apart from home electronics by 2011.
Earlier, Panasonic’s subsidiary PEW acquired 80% of Anchor Electricals, a leading Indian electrical equipment maker that controls around 60% of the market for electrical switches and accessories. The deal gives Panasonic access to India’s growing middle-class market (about $400 million strong now) as well as low-cost manufacturing assets.
To drive growth in battery and car business, Panasonic had earlier acquired SANYO Electric Co Ltd., a manufacturer and seller of electronic equipment and rechargeable batteries. This acquisition proves to be advantageous for Panasonic, as the latter is a key player in the solar cells and rechargeable batteries markets and facilitates Panasonic to move ahead with the car battery business in full swing.
Panasonic had also created a joint venture with Toyota Motor called Panasonic EV Energy. Further, the company announced partnership with Tesla Motors, the electric car maker. Under the agreement, Tesla will buy battery cells for its current and future cars. The Tesla contract will give the company considerable advantage in the market.
Panasonic’s new mid-term management plan is expected to help it become the No.1 Green Innovation Company in the Electronics Industry by 2018. In fiscal 2013, under the new management plan, Panasonic will drive growth by focusing its resources on six key business areas, which include energy systems, heating/refrigeration/air conditioning, network AV, security, healthcare and LED.
However, Panasonic may not be able to achieve double-digit growth in overseas sales. Moreover, the company may not be able to achieve its target for its four strategic businesses– digital AV business, automotive electronics business, business providing comfortable living, and semiconductors and other devices business– in terms of its sales growth in the present economic condition.
However, we remain positive on Panasonic’s new initiatives and expect the company to become stronger, moving forward.
Read the full analyst report on “PC”
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