In the 1970s, Vijay Mansukhani was working in the Iranian merchant navy. As a man who was starting off his career, he was happy earning approximately six times the salary that Indians in the merchant navy were earning. But when he met his business partner Gulu Mirchandani, his life changed. Vijay decided to jump ship and become an entrepreneur.
Leaving behind a well-paying job was risky. But little did Vijay know that he and his partner would go on to redefine the Indian consumer durables industry with their iconic ‘Onida’ brand of TVs.
Vijay Mansukhani, Co-founder and MD, Onida (a brand under Mirc Electronics)
“We had started the company when the Asian Games happened in Delhi. The late PM Indira Gandhi had just opened the floodgates of opportunities by announcing national telecast and colour television around that time,” says Vijay Mansukhani, Co-founder and MD, Mirc Electronics.
“Since my engineering days, I had been looking for the right opportunity. During The Asian Games, I spotted that opportunity, and recognised it for what it was,” he recalls.
“I then gave up my career as a marine engineer and took that leap of faith. That’s how Onida happened," he adds. In an incredible tale of perseverance, battling adverse economic conditions, and facing stiff competition from foreign companies, Onida emerged triumphant. It became a household name as lakhs of Indians were buying their first TVs and were choosing Onida.
Over the years, there have been challenges, but Vijay has authoritatively led Onida to become a Rs 736 crore turnover company. At 69, he is now a stalwart in the Indian consumer durables industry, but he remembers the big risk he took by becoming an entrepreneur.
In an exclusive interaction with SMBStory, Vijay recounts his Onida journey and explains how it became a big brand of India.
Vijay Mansukhani: I am from Mumbai, and I joined a marine engineering college in the city. Subsequently, I joined the Shipping Corporation of India (SCI) and later moved to Australia and Iran for better job prospects. It was during this time I met my partner Gulu Mirchandani. He is an engineer from BITS Pilani and was working in pharma.
Once we saw the opportunity to make TVs, we realised we did not know too much about getting bank credit. Thus, we started up with money from our personal accounts and from some private financers. In 1992, we did an IPO and turned out to be successful. We also raised Rs 144 crore through preferential issue of shares to Ashish Kacholia from Lucky Securities. Promoters and other shareholders have infused funds through rights issue in the past.
VM: Onida has ruled Indian households for 36 years with our iconic devil mascot and tagline ‘neighbor’s envy, owner’s pride.’ We achieved many milestones which made our success possible. The early days were hard spent in introducing new technologies and innovative products.
In 2006, we were ranked second in Dun & Bradstreet India’s top companies list in terms of income in the consumer durables segment. We also ventured into air conditioners and won the Star Performer Certificate from Urjavaran Foundation for the most energy efficient air conditioners.
In 2012, we ranked 18th in The Brand Trust Report India study. In all this time, we continued to launch innovative products. We have also been communicating about these innovations to consumers, in the right way and through the right mediums.
Onida's product range
VM: Right now we are into Panel TVs, washing machines, air conditioners, and microwave ovens. We are headquartered at Andheri, Mumbai, and we have two state-of-the-art manufacturing plants at Wada and Roorkee. We manufacture panel televisions at Wada and washing machines at Roorkee. The manufacturing facilities are fully automated and all the machines are from the USA and Japan.
The government increasing the customs duty on importing finished panel television panel has encouraged the manufacturing of the panels domestically. So, we have recently started manufacturing TV panels at our Wada plant for captive consumption.
VM: According to data from the Indian Brand Equity Foundation, the current size of the LED Panels market is Rs 7,371 crore and we enjoyed a market share of five percent in FY18. The size of the AC market is Rs 12,840 crore and we have a market share of two percent. The size of the washing machine market is Rs 7,700 crore in FY 18, and we have three percent of the market share.
To reach out to this market, digital marketing is an integral part at Onida. We connect with our tech-savvy and millennial audience through digital and social media. We run campaigns on digital media, Google adverts and sharing of content at regular intervals to keep our brand top of the brand recall. Our public relations efforts also yield online stories which also enhances our brand visibility among consumers who are always online.
VM: As a brand, Onida has been one of the most cherished in India. We have received a lot of appreciation for our brand and quality since inception. When cathode ray tube TVs (CRT TVs) were launched along with our mascot, the ‘devil’, in the ‘80s, it was such a rage. Everyone loved the product, and there was positive word of mouth for the product. Almost every household owned an Onida TV.
But as the years passed, CRT TVs were discontinued, and then came the evolution of panel TVs. Here, there was a stiff competition with foreign brands but our customers had an affinity towards our brand and are still proud of it. This goodwill has rubbed off on to the products we have introduced. We also see good traction for our air conditioners, washing machines and microwave ovens. This is all because of our strong brand recall.
VM: The nature of our business is such that there is constant pressure on technological upgradation in the products. Especially in the consumer durables segment, in order to stay relevant and meet the customer expectations, we have to reinvent ourselves on an ongoing basis and provide value to customers.
Other challenges apart from technological innovation are the duties that are levied on the consumer durables industry. If the percentage of duties that are levied on this sector is looked upon by the government, the ‘Make in India’ label will certainly get a boost and this will only benefit a ‘Make in India’ brand like Onida. The high GST rates of 28 percent on air conditioners and large size televisions are detrimental for the growth of the consumer durable sector in the country.
VM: There is enough market and more people coming in to business will expand the market, having said that there are multiple entry barriers like huge investment to set up plants, establishing marketing and after sales service network and sourcing of various parts from across the world. Building brand and winning the trust of the consumers will also take a lot of time for new players who will enter the market.
VM: Onida is expecting good growth rate in the coming years. Consumption is going to pick up on account of demand and low penetration levels of consumer durables goods. We will continue to deliver profits going forward. We are currently working with 4,000 dealers across India and continuously striving to increase this number. We have garnered 15 percent of revenues from modern retail and our products are available on Flipkart, Amazon, Paytm and Tata CliQ.
We are now focusing on non-captive manufacturing wherein we have started manufacturing televisions for leading conglomerates in the country. Kaval G Mirchandani is the next-gen business leader of our company. He is currently the Director of Mirc Electronics, and has wide experience in the electronics industry.