Havells plans to stay ahead in the race with its lat­est PoE tech­nol­ogy

The In­dian light­ing in­dus­try has pro­gressed con­sid­er­ably over the past three years, aided by im­proved tech­nolo­gies and in­tel­li­gent sys­tems. Af­ter tran­sit­ing from con­ven­tional lamps to LEDs, the In­dian light­ing in­dus­try is now ask­ing, ‘What’s next?’ To fin

Electronics Bazaar - - Contents -

EB: How much does your LED prod­uct port­fo­lio con­trib­ute to your over­all turnover?

Our LED prod­ucts ac­count for about 75 per cent of the turnover in the light­ing di­vi­sion. Our light­ing rev­enue comes from con­sumer light­ing and pro­fes­sional light­ing. The con­sumer lu­mi­naires sec­tion gen­er­ates 55 per cent of the rev­enue from light­ing. This busi­ness is purely through trade. Of the 45 per cent that comes from the pro­fes­sional cat­e­gory, the ma­jor­ity is in­sti­tu­tional sales. We have in­door and out­door light­ing so­lu­tions, which in­clude com­mer­cial, street light­ing, re­tail, area and façade light­ing, etc. Of all these prod­uct types, 40 per cent of our rev­enue comes from street light­ing.

In façade light­ing, we have re­cently launched a range called Colorscape, which is ar­chi­tec­tural RGB light­ing. The range in­cludes RGB colour­chang­ing fa­cade light­ing. Cur­rently, we are light­ing up mon­u­ments of na­tional re­pute with the Colorscape range. Lead­ing de­sign­ers and spec­i­fiers have pa­tro­n­ised Colorscape and soon ma­jor projects across In­dia will be us­ing this in­tel­li­gent range of light­ing.

EB: What growth do you fore­see in the LED light­ing seg­ment over the next three years and how does Havells plan to be a part of it?

We are liv­ing in the most ex­cit­ing times in hu­man his­tory. ‘Dis­rup­tive tech­nol­ogy’ was our slo­gan in the re­cently con­cluded ELECRAMA. To­day LEDs have be­come more ro­bust and re­li­able. In light­ing, the next five years look very bright. The trend of us­ing LEDs has now picked up pace, mainly be­cause of the sav­ings in en­ergy. Fol­low­ing the mantra, ‘En­ergy saved is en­ergy gained’, the gov­ern­ment and pri­vate play­ers are also see­ing the change in en­ergy con­sump­tion and the pay­back pe­riod, too, is now not very long. We pre­dict that this trend will con­tinue, and with the gov­ern­ment push­ing LED street light­ing through EESL, there will be a fur­ther surge in the next five years. The num­ber of street­lights in In­dia is so high that it will take an­other five years to com­pletely switch to LED lights. By that time, the fix­tures in­stalled to­day will re­quire re­place­ment. So the process will con­tinue.

EB: Is there a capex plan that you are work­ing on?

We have taken a test order from the NDMC (North Delhi Mu­nic­i­pal Coun­cil) that is worth `4.5 bil­lion. We will get paid in seven years. The ini­tial in­vest­ments are ours, so what­ever en­ergy sav­ings ac­crue, 80 per cent of these will be given to us and 20 per cent will be re­tained by NDMC. This is the kind of in­vest­ment model that is be­ing tested with the com­pa­nies.

EB: What has mo­ti­vated Havells to com­pletely stop CFL pro­duc­tion?

We stopped CFL pro­duc­tion six months back. The good news is that none of our plants got af­fected due to that. We have switched the CFL SMT lines to LEDs and our em­ploy­ees are still work­ing in that plant. Mak­ing the switch from CFL to LED does not re­quire a com­plete change in equip­ment, as is the case when switch­ing from in­can­des­cent to LED.

First of all, CFL has the mer­cury is­sue. One spoon of mer­cury can con­tam­i­nate one big lake. Sec­ond, the prices of CFL and LED bulbs are to­day the same. On top of that, the LED lu­men out­put is more and en­ergy con­sump­tion is less.

There are still many com­pa­nies mak­ing in­can­des­cent and CFL lights, and there are peo­ple buy­ing them. Since those pro­duc­ing in­can­des­cent lamps have man­u­fac­tur­ing lines that are com­pletely dif­fer­ent and can­not be eas­ily changed for CFL or LED pro­duc­tion, they are con­tin­u­ing with those lamps to keep their plants run­ning.

More­over, as per the Havells cor­po­rate strat­egy that was for­mu­lated 15 years back, when we came into light­ing it­self, we never got into mak­ing in­can­des­cent lamps or flu­o­res­cent tubes, be­cause these are the most en­ergy in­ef­fi­cient. Wast­ing the coun­try’s en­ergy by us­ing these lamps does not make sense. If com­pa­nies pro­duce them, peo­ple will buy them – it’s a chain re­ac­tion. Be­cause of the gov­ern­ment’s em­pha­sis on re­duc­ing mer­cury lev­els, we have taken the cau­tious de­ci­sion of not pro­duc­ing CFLs too.

We con­tinue to make sim­i­lar sales from LED lights, and our bucket size re­mains the same even though we have stopped mak­ing CFLs.

EB: What do you think about the is­sue of ob­so­les­cence in light­ing?

The rate is very high. That’s the big­gest chal­lenge for us – that the life cy­cle of a prod­uct is very short. More and more sim­i­lar prod­ucts are launched – there is a very thin line sep­a­rat­ing which ones sell and which do not. The busi­ness does take a hit be­cause of ob­so­les­cence, ev­ery year. It is not that the prod­uct’s qual­ity is bad, but once the next gen­er­a­tion of prod­ucts comes in, the ear­lier prod­ucts, by de­fault, are ob­so­lete.

EB: Go­ing for­ward, will Havells’ in­vest­ments in in­fra­struc­ture de­crease or will third party out­sourc­ing pre­vail?

We are the only com­pany in In­dia with its own state-ofart man­u­fac­tur­ing plant. Our core phi­los­o­phy is linked to man­u­fac­tur­ing, so all the prod­ucts sold by the com­pany are en­tirely man­u­fac­tured in-house. Go­ing for­ward, we will con­tinue to man­u­fac­ture prod­ucts in-house rather than out­sourc­ing the pro­duc­tion, but the ra­tio will be 60:40. Although our de­sire is to man­u­fac­ture 100 per cent of our pro­duce in­ter­nally, keep­ing in mind the lim­i­ta­tions, we will make 60 per cent in-house while out­sourc­ing the re­main­ing 40 per cent.

EB: What ex­ist­ing chal­lenges can the new PoE (Power over Eth­er­net) tech­nol­ogy solve?

PoE light­ing refers to the abil­ity to use an Eth­er­net ca­ble to power light fix­tures (lu­mi­naires), and trans­mit data be­tween the lu­mi­naire and the con­trol soft­ware. In­tel­li­gent LED light­ing so­lu­tions are driv­ing the dig­i­tal trans­for­ma­tion of the light­ing in­dus­try, which has be­come the foun­da­tion for smart build­ing au­to­ma­tion. PoE tech­nol­ogy will be used a lot more for in­door light­ing. Its ma­jor ben­e­fits are en­ergy sav­ings, space op­ti­mi­sa­tion, pro­duc­tiv­ity en­hance­ment and se­cu­rity alerts.

PoE uses sen­sors mounted on light fit­tings for the pre­dic­tive analysis of en­ergy con­sump­tion. Thus, if a room is not oc­cu­pied, in­tel­li­gent an­a­lyt­ics can switch the par­tic­u­lar area’s air con­di­tion­ing to la­tent mode. In ad­di­tion, other fea­tures such as au­to­matic on/off, move­ment de­tec­tion, oc­cu­pancy alarms, day­light har­vest­ing and other es­sen­tial fea­tures can save a lot of en­ergy and in­crease pro­duc­tiv­ity. And let’s not for­get the pre­cious money that is saved— which oth­er­wise could have been drained in en­ergy bills.

Very of­ten, we book a con­fer­ence room and, if we do not use it, we for­get to can­cel our book­ing. In a room where PoE light­ing is used, sen­sors will note that de­spite the book­ing, the place is not oc­cu­pied and will send an alarm to the ad­min. And the same room can then be al­lo­cated to the next per­son who needs it.

EB: How far have you pro­gressed in im­ple­ment­ing PoE in your so­lu­tions?

We are think­ing about this on an ex­po­nen­tial scale—more as a so­lu­tions provider rather than be­ing just an elec­tric light­ing provider. We are work­ing to­wards that goal steadily. Un­der­stand­ing the pain points of cus­tomers in con­nected spa­ces, we re­alise that our tech­nol­ogy should be ro­bust, re­li­able and most im­por­tant, scal­able. Thus, the trans­fer of tech­nol­ogy is what we are look­ing for. To en­able this, we are in ac­tive talks with a Euro­pean so­lu­tions provider.

EB: How will the cost of the end prod­uct dif­fer with the im­ple­men­ta­tion of PoE tech­nol­ogy? What will the ROI be?

Just as no one buys a smart­phone based on just its abil­ity to make phone calls, fu­ture buyers of smart light­ing will not be do­ing so purely for its abil­ity to pro­duce il­lu­mi­na­tion.

We have to keep in mind that, in the fu­ture, cus­tomers will not be buy­ing a set of light fix­tures but buy­ing into an ecosys­tem of ap­pli­ca­tions and ser­vices that have ab­so­lutely noth­ing to do with light. You will find light­ing in­ter­sect­ing with ad­ja­cent sec­tors like se­cu­rity, sens­ing, Big Data, and even ad­ver­tis­ing.

How­ever, to an­swer your question—yes, the price of the end

Just as no one buys a smart­phone based on just its abil­ity to make phone calls, fu­ture buyers of smart light­ing will not be do­ing so purely for its abil­ity to pro­duce il­lu­mi­na­tion

prod­uct in the case of PoE tech­nol­ogy will be higher than that of prod­ucts that use ex­ist­ing tech­nol­ogy. This is be­cause of the ad­di­tional cost of the in­tel­li­gence em­bed­ded in the dumb light fix­ture via a sen­sor and the ther­mal re­lays. So, the price of the fix­ture is the same but the price of the bal­last, sen­sor, etc, will add up to make the over­all cost much higher. But if we look at the over­all busi­ness propo­si­tion and the long term pay­back pe­riod, then the cost sav­ings will also be much higher than what cus­tomers get now. Be­sides, all the tech­ni­cal ben­e­fits will play a big role in help­ing In­dia meet its en­ergy ef­fi­ciency and sus­tain­abil­ity goals.

EB: How are the small and medium play­ers across the coun­try adapt­ing to the newer light­ing tech­nolo­gies, given the cost­sen­si­tive na­ture of the mar­ket?

We are liv­ing through a pe­riod marked by fun­da­men­tally dis­rup­tive op­por­tu­ni­ties. New tech­nolo­gies, prod­uct ob­so­les­cence, AI and IoT have rewrit­ten the rules of the game in the light­ing in­dus­try. Cre­at­ing new prod­ucts should be the pri­or­ity of ev­ery com­pany. We un­der­stand this and have in­vested a lot in R&D, over the past decade. We are among the few light­ing com­pa­nies in the world manned by more than 200 R&D engi­neers.

Fly-by-night op­er­a­tors will have a dif­fi­cult time prov­ing their met­tle in the long run. The cus­tomer is now more in­for­ma­tion en­abled. Thus, only com­pa­nies like ours, that have taken care to in­vest in man­u­fac­tur­ing lines and in build­ing a fac­tory backed by strong R&D and a ro­bust dis­trib­u­tor net­work will sur­vive.

At Havells, in­no­va­tion is a way of life. Also, we should re­mem­ber that more than our capex, tak­ing care of the con­sumers’ opex needs is very im­por­tant. Thus, a strong af­ter-sales net­work, ex­pe­ri­en­tial show­rooms, ware­houses and branch of­fices gen­er­ate trust among dis­cern­ing users, cus­tomers and end users. The in­dus­try is set for a mas­sive trans­for­ma­tion and its CAGR is grow­ing at a dou­ble digit pace.

EB: Is Havells gear­ing up for the smart city mis­sion?

We are among the ac­tive play­ers in the smart city do­main. To en­able this, we have in­vested in home grown tech­nol­ogy, af­ter un­der­stand­ing the needs of the In­dian mar­ket. We help cities use in­for­ma­tion and com­mu­ni­ca­tions tech­nol­ogy (ICT) to gain in­sights on how to en­hance liv­abil­ity, work­a­bil­ity and sus­tain­abil­ity. Havells is mak­ing sure it com­plies with all the ma­jor rel­e­vant stan­dards, glob­ally. As a re­spon­si­ble and so­phis­ti­cated tech­nol­ogy com­pany in In­dia, we fo­cus on so­lu­tions that are tai­lor-made for In­dian re­quire­ments. StreetComm, our patented in­tel­li­gent street light­ing sys­tem, is a so­lu­tion de­signed by us, keep­ing in mind the sen­si­tiv­i­ties and re­quire­ments of In­dian cities, city au­thor­i­ties and ul­ti­mately, the cit­i­zens.

The so­lu­tion is highly mod­u­lar and flex­i­ble, and can be eas­ily in­te­grated with any ex­ist­ing tech­nol­ogy in­fra­struc­ture of the city. It has been en­gi­neered with just the right level of tech­ni­cal so­phis­ti­ca­tion needed to ad­dress the cit­i­zens’ pain points. As it is de­signed and man­u­fac­tured in In­dia, it is af­ford­able and its price is jus­ti­fied eas­ily by the value de­liv­ered in terms of en­ergy ef­fi­ciency, op­er­a­tional ef­fi­ciency, smart­ness and the col­lec­tion of Big Data. The so­lu­tion is in­tel­li­gently de­signed, keep­ing in mind lo­cal op­er­a­tional de­mands and thus the to­tal cost of own­er­ship is low—a fact that is of­ten ig­nored in many IoT so­lu­tions. We have a ded­i­cated R&D di­vi­sion backed by a sales force to cater to smart light­ing op­por­tu­ni­ties.

We have bagged a ma­jor smart city order, and are in the process of ne­go­ti­at­ing and bid­ding for more.

Anil BhAsin, pres­i­dent, Havells In­dia Pvt Ltd

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