Revenue from India to jump 5 times in coming years: Delta India MD

Taiwanese electronics manufacturing company Delta Electronics expects revenue from its India operations, which currently constitutes 3-4 per cent of its total sales, to jump five-fold in the next half a decade through a boost in manufacturing and exports. The power management solutions company, which also designs and makes electric vehicle chargers, is planning to strengthen its R&D operations in Bengaluru and expects to boost its workforce here to 1,000 engineers by 2027-28. In an interview with DH’s Anjali Jain, Delta Electronics India’s Managing Director Niranjan Nayak touched upon the opportunities the global management sees in India’s growing EV market, its plans to expand domestic capacity and the challenges the company needs to overcome.

Edited excerpts.

Could you tell me a little about which OEMs you have partnered with and what are your plans to expand?

In India, we are supplying to almost all the OEMs who are manufacturing EVs. We have Hyundai, MG, and Tata and now we are talking to Mahindra. So if we are not supplying at this point of time, then we are talking to them. We have close to 15 per cent market share in India at this point of time, planning to grow much bigger to probably 40 per cent in the next 3-5 years. So we have to be present with each and every OEM with a different percentage of share.

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Globally, we have installed more than 1.5 million EV chargers. In India, we have close to 8,000 charges now. In the next 5 years, I would say they should grow more than 6-7 times.

The company is planning to expand manufacturing in India. What are your plans towards that?

We have plants in Krishnagiri for export as well as local manufacturing. Some of them are not operational yet but we have invested looking at the next 5-10 years time span. As for EV chargers, we are already manufacturing them in our Rudrapur factory. In the next 1-2 years we will move to a larger factory down south in Krishnagiri as the output goes up and we try to scale up as far as challenges are concerned.

The company’s global revenue last year was close to $13 billion. What was India’s contribution to this?

As of now, India is not very significant, because all these revenues primarily are coming from other markets, mainly Europe. India is slightly about 3-4 per cent of the total revenue at this point of time. However, in the next 5 years, we will be growing significantly at least 5 times of what we are doing now.

We chose Krishnagiri as our hub as we want to be closer to the port to facilitate exports from India. We have already started exporting to Europe and the US, which is not significant at this point but by 2025-27, we will be getting significant revenue for Delta Global from India. We have a huge target for India to become one of the key factories for Delta Global.

How are operations going at your Bengaluru facility?

Delta is planning to strengthen its R&D capabilities in India and the Bengaluru facility is going to play a very key role in this regard. Today we have about 300 engineers in India, which we would like to grow 2-3 times in another 3 years. By 2027-28, we should have a strength of 1,000.

Could you elaborate on the investments Delta has made in India?

In 2016, our global CEO announced a $500 million investment in India over a period of 10-12 years. There has been a delay in rolling out the investment due to Covid, but the Bengaluru R&D center and large factories in Krishnagiri have come up from this investment. We will require a lot of resources and human capital in these centers which will be part of the investment. It would take another 2-3 years for us to consume the entire investment. The management in Taiwan is quite keen to grow in India even in the future, so we may expect much more than this in future.

What are the challenges you have faced in terms of expanding in India?

Clarity has to be brought in terms of some of the policies, because while the government support is very good, an understanding has to be made when it comes to central-state regulations occupying this space. So, it could take another 1-2 years for the market to consolidate. We still have to figure out how to speed up our roll outs in some of the areas. Because even though there is a demand in terms of the cars, enough OEMs have to put in their stakes here and then installations will take place.

The other area where we have to strengthen is supply chain management. India, when compared to other countries which are ahead in terms of the manufacturing supply chain, it is not fully ready. We would like to work with the key vendors in India who could support the kind of growth we anticipate both in terms of the material availability, quality of material and cost competitiveness. manufacturing electronics components. The supply chain is currently not geared up to cater to a large demand.