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LG Electronics India arm to spend $103 mn on expansion

The Indian unit of South Korea's LG Electronics said on Wednesday it will spend Rs 5 billion ($103.7 million) over the next three years to boost its sales in India's consumer appliances sector.

LG Electronics India Pvt Ltd, an unlisted wholly-owned unit of the Korean company, is among a host of foreign consumer electronics firms which have entered India over the last decade encouraged by the country's growing middle-class population.

"We are going to invest Rs 5 billion over the next three years on expanding our operations in India," LG Electronics India managing director Kwang-Ro Kim told reporters in the eastern city. "It will help us retain our premier position."

Officials at LG Electronics India, which makes colour televisions and home appliances, said the company's revenue was likely to jump 36 per cent on a year-on-year basis to Rs 30 billion in 2002.

LG Electronics India is currently the number one player in the country's 6-million-units-a-year colour television segment with a market share of 17 per cent, Chandramani Singh, the India head of LG's colour TV business, said.

The company also has a strong presence in the semi-automatic washing machine and frost-free refrigerator segments.

Kim said around Rs 2.5 billion would be spent on setting up a new manufacturing facility in India. Its only plant in the country is located on the outskirts of New Delhi.

"The new factory will be located either in Hyderabad or Bangalore or Pune."

Kim said LG Electronics India, which earns most of its revenue from colour televisions, was aiming at a revenue of Rs 40 billion in 2003 on the back of a jump in sales of colour TVs and launches of new products, including mobile phones.

India's white goods sector includes several domestic players like the Mumbai-based Videocon International and BPL and foreign companies like Samsung Electronics and Whirlpool Corporation.

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