Nissan India Partner Thinks Small to Close Gap With Tata

Ashok Leyland Ltd. (AL), India’s second- biggest truckmaker, is adding small goods carriers and expanding overseas to claw back market share lost to Eicher Motors Ltd. (EIM) and Tata Motors Ltd. (TTMT)
Nissan Motor Co. (7201)’s Indian partner, which reported its smallest gain in sales in three years in the 12 months ended March 31, plans to add 25 models in the year that began April 1, Vinod Dasari, the company’s managing director said in an e- mailed response to questions. The company last year began selling the small carrier Dost, which means friend in Hindi.

“We have a three-month waiting period,” for the Dost, said Dasari. “By entering the light-commercial vehicle market with Nissan, we have filled a very critical gap in our product range.”

Ashok Leyland, set up in 1948 to assemble Austin Motor Co.’s A40 cars, is betting more products in India’s fastest growing automotive category will help it regain lost market share. Partnering with Japan’s second-biggest automaker will help the Chennai-based company accelerate development of cargo vehicles of maximum weight of 7.5 tons after lagging behind Tata Motors and Mahindra & Mahindra Ltd. (MM) in entering the market.

“Light-commercial vehicles will be the growth driver in the commercial vehicle space,” said Abhishek Banerjee, an analyst at Asian Markets Securities Pvt. in Mumbai. “Had Ashok Leyland not come up with the Dost, it would have been in a tough spot.” He has a sell recommendation on the stock.

Ashok Leyland, which has hired Mahendra Singh Dhoni, captain of India’s cricket team, to endorse its products, has risen 9 percent this year, lagging behind a 38 percent gain in Tata Motors. Ashok Leyland rose 0.4 percent to 24.95 rupees at the close in Mumbai.

Equal Venture

India’s light-commercial goods carrier segment grew 30 percent in the year ended March 31, led by Tata Motors’ Ace. Ashok Leyland sold 7,593 units of its 2.5-ton Dost vehicle in the period, after starting sales last year, while Mahindra sold 127,029 units including its Maxximo and Genio models.
Nissan and Ashok Leyland’s equal venture plans to spend 11.5 billion rupees ($203 million) to introduce three small trucks, the first of which was the Dost, in India to tap demand for smaller vehicles used for deliveries within cities and for rural transportation, Andy Palmer, Nissan’s senior vice president said in March 2011. The venture will have a capacity to produce 150,000 vehicles a year by March 2014, Palmer said.

Record Harvest

Light goods carriers have become popular as a second year of record food grain harvest and unprecedented government prices for crops boosts rural income and demand. India raised the minimum price of paddy by 16 percent to a record 1,250 rupees per 100 kilograms for the 2012-2013 crop season.
“LCVs have replaced 3-wheelers and pickup trucks for the last mile connectivity,” said Mahantesh Sabarad, an analyst at Fortune Equity Brokers India Ltd. in Mumbai. “It’s much more economical to use an LCV over a pickup as the fuel economy is better.”
Competition is increasing for Ashok Leyland in its main business as overseas rivals lured by rising demand build local factories. Sales of medium and heavy trucks are forecast to almost double to 500,000 vehicles by 2020 from 270,000 last year, according to IHS Automotive.
Deliveries of the company’s heavy and medium trucks declined 3.5 percent to 60,480 units in the year ended March 31, compared with the industrywide increase of 8.8 percent, a trade group’s data show. The company has seven truck and bus factories in India and sells through more than 400 outlets.

Daimler, Navistar

Daimler, the world’s biggest truckmaker, this year opened a factory to build carriers ranging from six tons to 49 tons in India. Daimler will unveil 17 models by 2014, and the factory will be able to initially produce 36,000 trucks a year, Daimler said in April.
Mahindra partnered Navistar International Corp. (NAV) (NAV) in 2005 to build trucks, while Volvo AB, the world’s No. 2 truck maker, invested $275 million in a venture with Eicher to make vehicles in India in 2008.
Tata Motors, the owner of Jaguar Land Rover, controls 62 percent of the large and medium truck market, according to data from the Society of Indian Automobile Manufacturers. Ashok Leyland’s share dropped to 20 percent in the year to March 31, compared with 23 percent in the year-ago period. Eicher’s share rose 1 percentage point to 11 percent, data show.
“The times are tough for Ashok Leyland,” said Umesh Karne, an analyst at Brics Securities Ltd. in Mumbai. “For the last one year, the Indian commercial vehicles market has been under pressure.”

‘Game Changing’

Among the 25 products planned for this year include Ashok Leyland’s first front-engine, flat bus and a 37-ton truck both described as “game changing products,” by Dasari.
The company also plans to export trucks to South America, Southeast Asia and west Africa to boost revenue, Dasari said. Sales overseas contributed about 11 percent of total in the year ended March 31.
“We believe that with the light commercial vehicles and growth in exports, Ashok Leyland will be able to grow market share,” said Sabarad of Fortune Equity, who advises buying the shares. “A set of new products and better marketing spend will help them.”

Teijin eyes India carbon fiber foray

Teijin Ltd. is preparing to make a full foray into the Indian market for carbon fibers, a light but strong material that can replace steel and aluminum, a senior company official said.

"Teijin is contacting a major Indian automaker," Vice President Norio Kamei said Friday, indicating its plan to pursue joint development of vehicle components in the quickly growing economy.

Many firms are using carbon fibers in aircraft fuselages and car bodies. But demand is expected to rise further ahead of the introduction in 2015 of new environmental regulations, including requirements for reducing carbon dioxide emissions, in the United States and Europe, Kamei said.

Carbon fiber is "the only material that can make auto bodies lighter," he said.

Hoping for the material to be adopted for mass-produced high-end vehicles, Teijin has been developing carbon fiber products with General Motors Co. and negotiating with domestic makers.

The firm is promoting carbon fibers to automakers in emerging economies through its branches in India, China and Singapore.

17 nations keen to import wheat from India

Around 17 countries, including Japan, the Netherlands and Iraq, have evinced interest in importing wheat from India, the world's second biggest producer, a top government official said today.
At present, the government is grappling with the problem of plenty due to record production in recent years. Its godowns are overflowing with a record 82 million tonnes of rice and wheat, against the storing capacity of only 64 million tonnes.

The government is mulling export of 2 million tonnes of wheat from its stockpiles.

Representatives of various countries today had a meeting with the officials of External Affairs Ministry, the official told PTI.

"It was a preliminary meeting. The representatives of countries enquired about the quality of wheat and modalities of shipment among other issues," the official said.

The government had lifted ban on wheat exports in September 2011 but the shipments have not been picked up so far. Over one million tonnes of wheat have been shipped through private trade since September 2011.

The country is facing storage crisis and wants to clear wheat stock, especially that of 6.6 million tonnes lying open in unscientific way before monsoon picks up in the coming weeks.

India is also in talks with sanction-hit Iran for export of wheat and is resolving the quality issues.

Experts said that India is in a better position to export as the CIF (Cost, Insurance and Freight) of wheat grown in Australia and the US is close to $315 per tonne.

The country's godowns are full with rice and wheat stocks due to record procurement and production in the last few years. Wheat production is estimated to be bumper 90.75 million tonnes in 2011-12 crop year (July-June)

Japanese companies line up to invest in Gujarat

A number of Japanese companies are finalizing investment plans in BJP-ruled state of Gujarat. The names of the new investors and possible amount of investments are likely to be made public during chief minister Narendra Modi's proposed 5-day-long visit to Japan beginning July 22, a senior Japanese official connected to the development told ET.

Modi was originally scheduled to visit Japan between July 16 and 21, mainly to woo investors, but the visit was postponed by a week because the dates were clashed with India's Presidential poll scheduled on July 19.

Currently, only 29 Japanese companies including DIC, Orix, Ricco, Hitachi Appliances, Panasonic etc have Gujarat chapters though there are 120 Japanese companies being active in India.

Modi is likely to visit Tokyo, Hamamatsu and Nagoya. The chief minister may also visit Osaka though it's not confirmed as yet, said the official. Maruti Suzuki's recent decision to make forays into Gujarat and have a production facility near Mehsana in north Gujarat has boosted Japanese investor's sentiments, the official further said.

Significantly, Gujarat is one of the six states where Delhi Mumbai Industrial Corridor (DMIC) is being built. Japan is a partner country in the DMIC project.

N Noguchi, chief director general of Japan External Trade Organization (JETRO) in India, confirmed that the CEOs of a large number of Japanese companies would interact with Modi at Tokyo and Nagoya. "We expect 300 to 400 top executives of Japanese companies would gather to attend Mr Modi's function", Noguchi said.

Japan's KWE invests Rs 267.7 cr in Gati-Kintetsu Express

GATI LIMITED, India’s pioneer in Express Distribution and Supply Chain Solutions, has concluded the Joint venture with Japan’s Kintetsu World Express to form Gati-Kintetsu Express Pvt Ltd, the new leader in Express Distribution and Supply Chain Solutions in the country.

Under the JV agreement, Gati will hold 70 per cent stake and 30 per cent will be held by Kintetsu World Express (KWE) in Gati-Kintetsu Express Pvt Ltd (GATI-KWE). GATI-KWE is a  subsidiary of GATI LIMITED. 

KWE received the Foreign Investment Promotion Board approval and  invested a total amount of Rs 267.7 crore for its 30 per cent stake in the JV and the monetary transaction has been culminated. This fund infusion makes  GATI’s  Balance sheet  much stronger through a significant deleveraging of the debt and reduction in the interest costs upto 50 percent, which in turn will help in re-investment in the growth of the organization and will reflect a healthy bottom line.

GATI-KWE brings together the strengths of Gati’s local expertise in Express Distribution and KWE’s global experience in 3PL warehousing, supply chain and freight forwarding capabilities creating an unmatched offering and superior value to customers. GATI-KWE  expects to provide a seamless transfer for cross border trade through a single window solution to its customers like Texas instruments, HP, Panasonic, Toshiba and other global players.

The JV also benefits from India- Japan Comprehensive Economic Partnership Agreement (CEPA) signed in 2011 and the two countries target USD 25 billion worth of bilateral trade by 2014 from the present USD 10.3 billion.

Speaking on the occasion Mahendra Agarwal, Founder and CEO of GATI LIMITED said “The Joint venture with KWE will set a new benchmark in Express Distribution and Supply Chain Solutions in India. All our efforts will now be channelized towards synergizing the strengths of both the companies thereby creating a win- win situation. We believe this alliance will create enhanced value for our customers and shareholders”

Mr Satoshi Ishizaki, President and CEO of KWE, said, “It is a proud moment for “GATI-KINTETSU” brand which combines the excellent infrastructure services of GATI and the service mind of KWE to provide the best possible services for all our customers”

GATI LIMITED the parent company will continue to provide leadership to GATI-KWE and to all its other businesses / subsidiary companies which are GATI INTERNATIONAL and GATI ASIA PACIFIC,  GATI KAUSAR (Cold Chain Solutions),  GATI HOME DELIVERY SERVICES and  GATI SHIPS.
GATI SHIPS has been recently transferred into an independent subsidiary company and is now on the path to recovery having stopped making losses.

About GATI LIMITED:
GATI LIMITED (www.gati.com) is pioneer and leader in Express Distribution and Supply Chain Solutions in India. Having started as a cargo management company in 1989, Gati has grown into an organization with more than 3500 employees and an annual turnover of Rs 12094 million (249 million USD) covering 622 out of  total 626 districts in India. Gati has over 4500 vehicles on the road excluding their fleet of refrigerated vehicles, container shipping vessels and world class warehousing facilities across India. Furthermore, Gati has a strong market presence in the Asia Pacific region and SAARC countries. Gati has offices in Singapore, Beijing, Shanghai, Qingdao, Hong Kong, Bangkok, Kuala Lumpur and Dubai and the SAARC countries.

About KWE Inc
The Tokyo Stock Exchange listed KWE Inc (www.kwe.com) is a Global provider of logistic services and solutions to its world-wide clients. Established in the year 1970, KWE today has a total of 333 offices in 203 cities in 31 countries overseas.
KWE provides comprehensive one-stop services & solutions that incorporate airfreight forwarding, Ocean freight forwarding and a full-range of logistics services to provide "Optimum Distribution Solutions" to its clients on a global scale. KWE has 57 affiliated companies with a total of 333 offices spread in 203 cities and 31 countries. The consolidated revenue for the last financial year stood at USD 3505.6 Mn and the consolidated net income was at 103.20 Mn USD. The total asset was at USD 1575.17 Mn.

About Gati-Kintetsu Express Private Limited
Gati-Kintetsu Express Pvt Ltd (www.gatikwe.com) is a Joint Venture between the Indian logistics player Gati Ltd and the Japanese logistics solutions provider KWE Inc. The company, formed in February 2012, specializes in Express Distribution and Supply Chain Solutions (EDSC) and combines Gati’s proficiency in 3PL in India along with KWE’s freight forwarding expertise and global customer base. The JV company, in which Gati holds 70% and KWE 30%, is targeting business expansion of domestic and international customers in the Indian market. The company shall also invest in high end 3PL facilities, including temperature controlled warehouses.

Living life in 3D

Tadato Kimura, Sony India’s marketing head, on selling the entertainment experience in the country

A law graduate from Kyoto University, Japan, Tadato Kimura has been associated with Sony Corp for the past 12 years. Prior to his assignment as General Manager, Marketing at Sony India, Kimura was with Sony CIS, based in Moscow as Senior Manager in charge of marketing. He was responsible for marketing VAIO notebooks as well as Sony’s direct business in Russia.

A nature lover, Kimura’s hobbies include travelling, reading and watching movies. He dreams of setting up an entertainment centre that is fuelled by Sony’s offerings in technology, music and entertainment.

My most memorable marketing initiative

One of the most memorable marketing initiatives has been the launch of 3D home entertainment solutions in 2010. Sony India aimed at establishing the 3D culture in India and making it easily available to a wider audience by launching 3D-enabled hardware products and software content.

As a marketing initiative Sony started a unique ‘3D World Road Show Campaign’ to make consumers aware of the 3D offerings. This promotional activity involved experiential kiosks set up in malls, airports and stores across the country. The kiosks were enclosed from three sides and equipped with 3D Bravia TVs at the front which helped consumers enjoy the 3D TV viewing experience to the hilt. We also initiated a 3D movie screening in a cinema hall to showcase the real essence of 3D, which was highly appreciated by the audience.

Of course, all this was backed up by aggressive PR and Web promotion. Last year, we also opened the Sony Media Technology Centre in Mumbai where students can learn the art of 3D film-making.

My first product launch

During my tenure in Thailand, I handled the launch of Vaio and it was my first product launch as well. The experience of launching such an exciting category was very insightful and memorable as the product was very well received in the country.

A great idea that never took off

Opening an entertainment hub, which would have a combination of technology and human brilliance by using an array of Sony products, music and entertainment is a dream yet to be fulfilled. It will bring all our forces together and create a great entertainment zone for the consumers to have an unforgettable and ultimate experience.

A setback that I have learnt from

Launching a product in the market before doing proper customer and market survey has often resulted in uneven sales. Over the years, I have learnt that customer feedback is vital to make a business work, and getting the correct customer feedback can bring a positive change in your business outlook.

My marketing idol

I admire Steve Jobs as the creator of one of the most iconic contemporary brands. He always inspires me to think out of the box and break the rules of the games once in a while.

Where I get my insights from

As a company our culture is to have a close relationship with our dealers, who are the crucial link between us and our customers. Hence, they are a source for insights. Also, I like to walk in to stores as a plain customer and see reactions of other buyers, which is extremely enriching.

One great takeaway from University

Apart from great education, I have been able to foster some great relationships from my university. I have learnt the art of living from my friends across the world and we keep sharing anecdotes of our learnings, success and failures to improve our lives.

Crystal gazing into 2013

Social media has gained tremendous importance. Right from market research to product testing and sales to after-sales, it plays an important part, given its real-time and highly engaging model. The digital revolution has become a rage and our engagement with it will only multiply manifold in the future.

Japan agency seeks to build Rs. 4,800 crore tunnel in Western Ghats

The Karnataka government is looking to solve the recurring problem of unmotorable roads on the national highway between Bangalore and the port city of Mangalore by constructing an 18.5 kilometre, multi-stage tunnel through the Western Ghats at a cost of Rs. 4,800 crore.



An expert group from the Japan International Cooperation Agency (JICA) has submitted a report to the Karnataka government on the construction of a four-lane expressway between Sakleshpur in Hassan district and Gundia in Dakshina Kannada district along National Highway 48 connecting Bangalore and Mangalore.


Under the JICA proposal, the proposed 18.5km stretch will include five tunnels, and four overbridges. A 2km arch bridge will also be constructed to provide connectivity across a valley.
The current 30km road from Sakleshpur to Mangalore climbs over the Shirdi ghat section of the Western Ghats.
The condition of this section of the highway deteriorates every year because of heavy rainfall—around 400 centimetre annually—and accidents are frequent.

In 2011, the state government spent nearly Rs. 22 crore on repairing the stretch.
The proposed expressway, to be built over six years, is expected to reduce the commuting time from 3 hours to less than half-an-hour. The proposed road will also improve connectivity to the New Mangalore Port.
“Currently, consignments from several parts of Karnataka prefer to go either to Chennai or to Goa despite Mangalore port being closer,” said Karnataka’s large and medium industries minister Murugesh Nirani. “We need to close the gap in the connectivity infrastructure.”

JICA also submitted that the project will be financially viable if traffic density is around 10,000 vehicles per day. According to the figures furnished by the National Highway Authority of India (NHAI), the traffic density is estimated at around 8,000 vehicles daily.
Nirani added that the Japan External Trade Organization (JETRO) had expressed interest in providing technical assistance to build the tunnel with private firms in a public-private partnership.

Public works minister C.M. Udasi said the state government had already submitted the proposal to the union ministry of road transport and highways and is awaiting a reply.
“We had a long discussion with the Japanese delegation during the Global Investors Meet earlier this month and some firms have expressed interest in taking up the project,” he said.

The state government took the tunnel approach after it failed to receive environment clearances for converting the the ghat section into a four-lane highway.
Several projects in the Western Ghats have been held up due to lack of environmental clearances. These include the Hubli-Ankola railway line and a hydel power project in Gundia.

DHL start direct LCL service from india to japan

DHL Express is a division of the German logistics company Deutsche Post providing international express mail services. DHL Global Forwarding has launched five new weekly less-than-container load ocean freight services between India and Japan.

Deutsche Post DHL’s air and sea freight division said the new services connect major sea ports in Japan directly to Chennai in southern India and New Delhi in northern India, without the need for reshipment.

Transit time could be cut between the two Asian countries by as much as six days compared to other ocean freight services, the company said.

DHL said the once-a-week “LCL Direct Box” services should also mean cheaper shipping, less chance of damage and cuts in carbon emissions for shipments of up to 3.25%.

From today (26 June) direct LCL services launch from Tokyo to New Delhi, offering a transit time of 26 days, along with a 28-day route from Nagoya to New Delhi, a 27-day route from Kobe to New Delhi, Tokyo to Chennai in 20 days and Kobe to Chennai in 21 days.

Mr. Mark Slade, the president and representative director of DHL Global Forwarding Japan, said his company was expecting growth in the Japan to India trade lane, suggesting the new LCL services would be of particular interest to customers in the automobile, electronics and high-tech sectors. The new LCL services add Chennai and New Delhi to DHL’s LCL Direct Box service, which already connects to Los Angeles, Chicago, Hamburg, Milan, Shanghai, Busan and Bangkok.

The company said it is continuing improving its LCL services within the Asian region, last year expanding its northern Asia services in China, South Korea and Taiwan, and earlier this year launching a direct Japan to Bangkok service.

Mr. Rench Leow, vice president of ocean freight and head of LCL management at DHL Global Forwarding Asia Pacific, said connecting key markets was an important part of his company’s strategy to become a preferred LCL carrier in the Asia Pacific region.

“India is one of the major economies in Asia and the country has an expanding effect on the world stage,” he said. “We’re very excited to offer customers to and from this huge market a wider opportunity to enjoy our state-of-the-art products and services.”

Fujifilm To Stop Selling Low Cost Camera In India

The recent fall of rupee has forced the company to take such decision as all the models are imported from China and Japan. This has affected the profit margins of the ULC cameras. 

Fujifilm has revealed its plans of exiting the ultra low-cost (ULC) market in India. The company has decided to discontinue selling models priced below Rs 4,000. The move has been taken as a part of the revenue generation exercise and will be executed within the next three months.

According to a PTI report, Rohit Pandit, executive vice president, Fujifilm India, said, “We are going to discontinue selling the ULC models in India. These models are comparatively less profitable. Moreover, none of our competitors are present in this segment. Instead, we will shift our focus to strength the brand position.”

India shouldn’t worry about rupee fall: Eisuke Sakakibara, former Japanese minister of finance

Eisuke Sakakibara, a former Japanese minister of finance and economist, known as 'Mr Yen' because of his ability to move currency markets during the '90s, advises the Indian government to take advantage of the falling rupee by boosting exports and not to fret about it.

The currency depreciation is a worldwide phenomenon caused by "simultaneous recession" in global economy, he tells TOI on a visit after becoming a board member at investment bank Avendus Capital.

You are here in the midst of what some people call an Indian currency crisis. What are your views on rupee's steepest fall ever in recent months?

What is happening right now is repatriation. Funds are now returning from emerging economies to US because of simultaneous recession worldwide . There's a flow from equities to bonds. It's a worldwide phenomenon triggered by the euro crisis.

India is running a current account deficit and capital inflows supported the currency so far. So as long as capital continues to flow out, this depreciation will continue . How long... is uncertain. If I were the Indian government, I would tell the Indian people, 'Don't worry because it is to do with repatriation and not because of any weakness in the Indian economy' and try to take advantage of the situation by increasing exports.

Do you think the euro will survive as a single currency ? How do you see the future of the Eurozone?

Germany and France forged European integration in the post-War era. But it's beginning to disintegrate because of the Greek crisis and the US crisis. I think the problem is structure. The Greek crisis has been temporarily suspended but it's spreading to Spain and perhaps Italy.

So the integration is at risk and this is a structural problem and I don't see any immediate way out of the European crisis. The crisis will continue and eventually hit European banks. Because bonds of south European countries are plummeting , the balance sheet of banks are deteriorating.

I think it is a possibility that some French, German or Italian banks may have a problem and the fiscal crisis may eventually become a financial crisis. I would not be surprised if a major financial institution in Europe goes bankrupt.

A lot has been said about Japan's debt that's running at about 200% of its GDP...

It's true that debt is high but Japan is not in a financial crisis . While the debt is 180% of the GDP, the accumulated assets of the Japanese households is almost 240% of the GDP, which more than covers up the debt. And most of that debt is owned by Japanese institutions unlike in the case of US, where more than 70% of its debts are in the hands of foreigners.

There's rising interest of Japanese corporates in India. How do you see the Indo-Japanese deal corridor shaping up?

Yen has been strong and I see it that way for a while, giving the Japanese companies enough comfort to pursue international acquisitions. They have gone into China in a big way, but are now talking about China Plus One strategy. That's bringing lot of focus on the Indian market where they see better longer-term growth.

India's younger population will sustain longer growth, possibly even 20 or 30 years after China peaks off. Japanese conglomerates , aided by low cost of capital, normally look at the long horizon.

University of Tokyo seeks collaboration with IGNOU

In a bid to attract more Indian students to study in Japan, the University of Tokyo has sought collaboration with the Indira Gandhi National Open University (IGNOU), a statement said here Wednesday.

"Presently, there are 1.4 lakh Indian students studying in Japan and the Japanese government wants to invite more and more Indian students, mainly in the field of research in science and technology," said Hiroshi Yoshino, director, University of Tokyo.

"We invite 60 students from all over the world for full scholarship, but, unfortunately, there are none from India at the moment," added Yoshino.

According to IGNOU Vice Chancellor M. Aslam, both the countries should benefit from the collaboration and he would also like the IGNOU technical staff to be trained at the Japan International Cooperation Agency (JICA) under the faculty-exchange programme.

"With such collaboration, more and more Indian students would seek Japan as their destination in near future," said Aslam.

 

The JICA is the primary Japanese governmental agency responsible for technical cooperation component of Japan's bilateral official development assistance programme.

Indian IT pitches for Japan business, but it’s a hard slog

In a tell-tale development which might define the future growth zones for the Indian IT industry, companies, from Tata Consultancy Services to Infosys, are looking to shift their eggs from the North America/UK basket to other markets.

Recently, PTI reported that Infosys opened its second Japan office at Nagoya to enhance its footprint in the Chubu manufacturing hub.

This move comes five months after rival TCS  announced a joint venture with Japan’s Mitsubishi Corp to invest  $5 million in a delivery centre in Japan. TCS also said that it expects Japan to contribute at least half a billion dollars of revenues in four-five years.

Why are the IT bellwethers chasing Japan?
Experts say Japan is a significant market in the Asia-Pacific region because the level of offshoring adoption is low – which signals a big opportunity. “Japan is still an untapped market and is very interesting as it is a high-cost economy,” said Amneet Singh, India head of Everest Group, an IT advisory firm.

Currently Japan is a negligible market as far as revenues go— well under 3 percent for HCL and Wipro who are considered to have good exposure in Japan.
He added that the aging Japanese demographic will pose a need for talent as well. In spite of this, Singh maintains that Indian companies have had only a sales presence in Japan until now and not made enough headway into the world’s second largest IT market.

The challenges holding back these companies are manifold: Language and cultural differences are big concerns. The language barrier has made Japanese firms outsource from regional players. But this is a minor glitch in the larger scheme of things, say some. “In spite of being in Japan for quite some time, Indian companies haven’t been able to meet with much success because the market is not expanding,” said Sudin Apte, CEO of Offshore Insights, a Pune-based IT research company. Apte maintains that it is a tough nut to crack because the companies have a different approach to outsourcing.

“Indian companies are used to the American way of doing business and find it tough to crack the model in Japan. The ownership patterns of companies are quite complex, which impacts decision-making,” said Apte. Indian IT majors have had limited success beyond the English-speaking markets of US and UK. Even in Europe, Germany and France contribute to only 4 and 2 percent of their revenue.
Japan and continental Europe may be the big potential areas, but the Indian IT companies clearly have to dance to a different beat.

Rajinikanth magic in Japan, yet again

For some strange reasons, Tamil superstar Rajinikanth is hugely popular in Japan ever since his 1996-super hit Muthu was released in the country.

The film ran for a record 23 weeks, that too at about 90 percent occupancy to become a top hit in Japan. After a dream run across the country, including through the WOWTOW private TV channel and DVDs, the film made it to the coveted broadcast list of NHK. The conservative public broadcaster aired the movie in 2001.

Since then, Rajini is a household name in Japan and the most popular Indian star in the country. The Newsweek even compared his popularity to that of Leonardo Dicaprio in Titanic.

The success of the film also led to a lot of academic analyses on Rajini magic.
One of them said: “Muthu is a well-made entertainment film that only professionals could create. The combination of high-level technique and simplicity as popular entertainment is quite sophisticated. Its song-and-dance scenes and action sequences in particular are superb and powerful. For example, the scene of the song called A Vegetarian Crane, which lasts for 5 minutes and 11 seconds, consists of 145 cuts produced with technical expertise in cinematography, choreography and editing. Such high-level techniques surprised Japanese audiences, and the variety of entertainment elements amused them.”

All subsequent films of Rajini have been released in Japan, some of them with the “Maharaja” tag, with considerable success.

The latest to screen in Japan is the Japanese version of his blockbuster Enthiran a.k.a Robot. The film has been trimmed to a running time of two hours, the usual length of Japanese movies.

Here is a trailer of the Japanese version of the movie.

India-Japan trade deficit widens post Cepa signing

Comprehensive economic partnership agreement (Cepa) with Japan from August 1, 2011, seems to have done little good for India with trade deficit widening between the two countries and trade tilting in favour of Japan.

Commerce ministry officials told Financial Chronicle that trade deficit between India and Japan has widened from $2.7 billion in August 2010-March 2011 to $2.9 billion in same period last financial year post signing of Cepa.

Trade deficit in August 2009-March 2010 stood at $1.9 billion. India’s export to Japan went up from $3.9 billion to $4.6 billion in August-March 2011-12 while its imports from Japan went up from $6.7 billion to $7.5 billion in the comparative period.

Indian exports to Japan between August 2011 to March 2012 was higher at 17.5 per cent vis-à-vis 13 per cent increase posted by Japanese exports to India owing to textiles. But, balance of trade continues to be in favour of Japan due to a boost in export of high-end products like medical instruments and rubber to India after the agreement came into force last year, an official said on condition of anonymity.

As part of Cepa, the two countries had agreed to eliminate about 94 per cent of tariffs within ten years (about 97 per cent by Japan and about 90 per cent by India) on a trade value basis. Japan agreed to eliminate almost all the tariffs on industrial products as the agreement become operational and also made commitments on agricultural products.

“Japan’s commitment on reducing tariffs on textile, agricultural and marine products are clearly reflecting export of these commodities to Japan in the eight months of last financial year since the agreement came into force. However, as they are low value products vis-à-vis medical and optical machinery being exported from Japan to India, the trade is still in favour of Japan,” the official said. He admitted that it’s really going to take long before we see any reversal in trend, if any.

India’s major gain from this agreement has been the export of textiles, yarn and fabric that together has 2,000 articles as Japan has done away with import duties on these products with immediate effect under the agreement. Consequently, the overall export of textiles from India to Japan saw a jump of 51 per cent.

Daikin to manufacture room air conditioners at Rajasthan plant

Daikin Air-conditioning India, a 100% subsidiary of Daikin Industries Japan, will soon start manufacturing room-air-conditioners at its Neemrana plant in Rajasthan.

The Neemrana plant hitherto produces Variable Refrigerant Volume (VRV) units and chillers for its B2B segment.

The company has chalked out an investment plan of Rs 2.5 billion for the new line. ``The new room air conditioners line will start commercial production from August-September,`` said Kanwal Jeet Jawa, Managing Director, Daikin Air-conditioning India.

At present, the company imports room air conditioners from its facilities in Thailand and Japan. The proposed line will have an annual capacity of 5 lakh units.

Indicating a possible moderation in prices of room air conditioners, post production in India, the company said, ``We want to make products in India with an Indian price tag to take on the mass segment.``

Currently Daikin room air conditioners are priced at 15-20% premium to the market average.

``At present our priority is localisation and manufacturing energy efficient products. Slowdown will not affect our plans as we are preparing ourselves for 2015,`` added Jawa.

The company plans to increase its headcount from the current 1,038 to 2,500 by 2015, including another 500 employees at its Neemrana facility by the end of current fiscal.

Jawa ruled out any further price hike for the rest of the calendar year. ``We change our pricing policy only once, at the start of the calendar year in January. In January, we had hiked our prices by 7-12% across product categories. Next change will come only in January 2013,`` he said.

Daikin Air-conditioning India closed the last fiscal with a turnover of Rs 12.2 billion and is looking at a growth of 40-50% in the current fiscal year.

Nissan chief wary despite quick disaster recovery

Nissan Chief Executive Carlos Ghosn said Tuesday the automaker needs to conserve cash despite its quick recovery from a year of disasters as the global economic outlook is highly uncertain.

Ghosn told the company's annual shareholders meeting that Nissan Motor Co. had bounced back from the earthquake and tsunami in northeastern Japan and the flooding in Thailand that battered Japanese automakers last year. Nissan, like other Japanese automakers, is also looking to growth in emerging markets such as Indonesia, India and Russia.

Nissan's January-March profit more than doubled to 75.3 billion yen ($941 million). Its global sales reached a record 4.85 million vehicles for the business year ended March in a remarkable recovery from production disruptions stemming from the disasters. Nissan is expecting a 400 billion yen ($5 billion) profit for the business year through March 2013.

But a shareholder who identified herself only by her surname Takahashi demanded to know why she was getting a dividend of only 20 yen (31 cents) a share if Nissan was doing so well.

Ghosn said Nissan has less cash than Japanese rivals Toyota Motor Corp. and Honda Motor Co. and must be more prudent in the current economic situation. The U.S. economic recovery has stalled and Europe's economy is stymied by high debt and austerity measures.

"We are facing extreme volatility," he told nearly 1,200 shareholders packing a convention center in the port city of Yokohama, where Nissan is headquartered.

Ghosn also grumbled about the strong yen, which erodes the value of overseas sales for Japanese exporters like Nissan. He said he was worried Nissan might have to reduce Japan production if the government didn't do something to bring the yen's strength under control.

Nissan, which makes the Altima sedan, Infiniti luxury model and Leaf electric car, is allied with Renault SA of France.

Nissan is reviving the Datsun nameplate brand that helped it grow in the U.S. when it was still a newcomer during the 1960s, but this time for emerging markets.

Nissan is also counting on growth in China, although not at the stupendous pace of a few years ago.

"We continue to be bullish on China," Ghosn said.

Infosys opens second development centre in Japan

Infosys has opened a second development centre in Japan as it prepared to have a more evenly distributed geographic spread across the globe.

In a statement on Monday, the IT major said its Japanese subsidiary is targeting the local manufacturing clients and accordingly, it has set up an office in Chibu.

Manufacturing sector

“We are aggressively targeting the manufacturing sector in Japan where at present we have 40 clients,” said Mr S.D. Shibulal, CEO and Managing Director, Infosys.

According to Infosys officials, apart from manufacturing, there are clients in financial services and consumer packaged goods sectors. This second development centre in Nagoya (apart from the one in Tokyo) is due to increasing business coming from Infosys’ Japanese clients.

Rising clients’ list

In the last two years, the number of clients in Nagoya and Tokyo has gradually increased and the office in Nagoya will focus on addressing these clients’ requirements, as well as pursuing new business opportunities, according to Mr V Sriram, Head - Japan Operations, Infosys.

According to Japan Electronics and Information Technology Industries Association, in April, the electronics industry was estimated to be ¥4,162,813 million.

Infosys does not give out revenues from Japan, but reports it as a part of rest of world. In FY12, rest of world posted revenues of Rs 3,554 crore, a 30.5 per cent growth over FY11, which was higher than revenue growth from the US.

Big opportunity

With increasing globalisation, Japanese companies like Sony and others have operations in places like China for manufacturing, which, in turn, throws up a huge opportunity to offer after sales and support services. Indian IT companies are waking up to this opportunity and trying to crack the Japanese code, according to analysts.

“Indian companies have to look at offering services to Japanese markets and establish a toe hold first,” said Mr Sanjoy Sen, senior director at Deloitte.

Last year, Infosys had said that it plans to reduce its exposure to the US market and was looking at a 40:40:20 ratio across the US, Europe and the rest of the world. Currently, it is about 60:30:10, according to company data.

Panasonic India may focus on Indian Tier 3 markets

Panasonic India, a consumer durables manufacturer, has stated that it is expected to emphasis strongly on the Indian Tier 3 markets by the next financial year 2013-14. Panasonic India is an arm of Japan-based Panasonic Corporation.

The company would be stressing on the 'mass segment products' and also look at the new channel partners to make its presence felt in the smaller towns.

Presently, it has 8,500 dealers and 134-standalone stores. The company is mulling to raise the count of the exclusive store count to 200 by year-end.

Manish Sharma, managing director, consumer products, Panasonic India Pvt Ltd, said, “We were earlier considered as a niche product. But now we want to focus into the mass category. The biggest growth is in smaller towns.”

The non-Tier-I towns, presently, are responsible for 15% of the consumer products' segments top line. The division was aiming to raise the contribution of Tier II and Tier III markets to close to 30% of its turnover. The consumer products division witnessed turnover of Rs 3,200 crore during the last fiscal (2011-12).
Sharma has said that the consumer division segment is likely to break in the present ongoing financial year.
Panasonic India has decided to opt for $300-million investment in India that will consist establishing of a new unit at Jhajjar (Haryana) and also marketing campaigns.

Doubles bout: It’s Honda and Yamaha vs Hero and Bajaj

The Japanese may be fierce competitors amongst themselves, but when it comes to dealing with the Gaijin – the non-Japanese – they hunt in packs.

Ever since Hero broke up with Honda – the last of the Indo-Japanese joint ventures to do the talaaq – the battle for the mobike market is essentially an India versus Japan title bout.

Currently Hero Motocorp dominates the 100 cc fuel-efficiency bike, and Bajaj Auto the 150 cc power segment with its Pulsar brand. As long as Hero and Honda were together, Honda was happy to take on Bajaj by building 150 cc bikes. Now it is aiming straight at the heart of the Hero empire by stepping down to 125 cc and 100 cc bikes.

Honda has already flung the gauntlet at Hero by launching the 110 cc Dream Yuga, and Keita Muramatsu has announced that fuel-efficiency is his goal. “If petrol costs go up by 10 percent, then our mileage should also go up by 10 percent. This is the challenge for Honda,” he told the media. In an interview to BusinessLine on Tuesday, he said: “…we will consistently focus on higher capacity along with (higher) mileage. Our challenge is to reduce running expenses for motorcycle riders in the mass segment.” This is Hero territory right now.
To be sure, he is going to get competition from Yamaha as well in this segment, but Yamaha is focusing on the other big boy – Bajaj Auto, which is topdog in the 150 cc segment. Hiroyuki Suzuki, Managing Director and CEO of Yamaha Motor in India, clearly told Business Standard that “our focus, as of now, is the 150 cc segment.”
Hero and Bajaj had better watch out: the Japanese want to dethrone India’s current bike champs in the fuel-efficient and power segments.

Japanese training ships in Mumbai

Japanese training ships Kashima, Shimayuki and Matsuyuki are on a six-day visit to Mumbai. The ships are on an overseas training cruise and will be visiting 14 countries in the Indian Ocean Region. The ships arrived in Mumbai on June 21 and will leave on June 26.

Captain Manohar Nambiar (Chief PRO-Indian Defence) said that commander of Japan training squadron Rear Admiral Hidetoshi Fuchinoue, is the senior officer present afloat. "The ships are on overseas training cruise among other visiting countries," said Nambiar.

He said, "Both Navies share converging views on the maritime areas of anti-piracy, humanitarian assistance, disaster relief, information sharing, amphibious warfare training and submarine rescue operations. Japan has also been an important trade partner and a supportive friend of India in the world forums."

Officials said on the sidelines of the visit, Rear Admiral Fuchinoue along with Akitaka Saiki, ambassador of Japan at New Delhi interacted with the commander-in-chief, Western Indian Naval Command.

In addition, various cultural, social, sports activities were organised for the visiting Japanese ships.

HMSI targets 4 mn unit sales

Honda Motorcycle & Scooter India Pvt Ltd (HMSI), the Indian subsidiary of Honda Motor Company of Japan, has set its an ambitious sales target of 4 million two-wheelers during fiscal 2013-14, a growth of 90 per cent over the sales of 2011-12. For the present fiscal, the company has set a target of achieving 28.5 per cent growth at 2.7 million units, 50 per cent of which would be scooters, a senior company official said.

“Last year we sold 2.1 million units of two-wheelers in India and we are running a huge backlog of vehicles due to capacity constraints. We are in the process of building our third manufacturing plant at Narasapur near Bangalore, which we will commission by April or May next year. With this, our capacity will cross 4 million units mark and that would help us achieve 4 million unit sales mark next fiscal,” Tomoaki Nagayama, Dy Director — sales & marketing, HMSI told Business Standard .

He said the company is presently investing Rs 1,500 crore to set up the third plant near Bangalore, which will have an initial capacity of 1.2 million units per annum. The capacity would be scaled up to 1.8 million units subsequently.


HMSI’s other two plants are located at Manesar in Haryana with a capacity of 1.6 million units and Tapukara in Rajasthan with 1.2 million units. In 2011-12, HMSI’s sales grew by about 31 per cent to 2.10 million units. With the completion of Narasapur plant, HMSI’s cumulative investment in India would cross Rs 5,000 crore mark, he added.

HMSI plans to manufacture its most popular scooter, Honda Activa along with Dream Yuga, a commuter bike launched just now at its Narasapur plant. Activa contributes almost 60 per cent to its sales in south India.
“We have planned expansion in south India as almost 30-40 per cent of our national sales come from the South. With the commissioning of our third plant, we would bring down the waiting period on some our vehicles from about two months to less than one month,” Nagayama said. A majority of its components suppliers are also moving to Narasapur.

“The growth in sales this year would come from our mass market bike, Dream Yuga and Activa, our most popular scooter. We intend to sell 300,000 units of Dream Yuga this year. Till early this year, we have seen a lot of demand for Activa, which have been converted into orders. We will be delivering those orders this year. We expect big growth to come from scooters as we have highest market share in the scooter industry,” Ashish Choudhary, South Region Sales Manager, HMSI, said.

He said HMSI presently has about 14-15 per cent market share in the Indian two-wheeler market and it aims to increase it substantially next year when the company’s third plant goes on stream.

“There are many big plans in our journey of becoming No.1 in Indian two-wheeler industry. We will introduce many new models as and when the demand comes up. We are currently working on several new models for Indian market at our R&D centre, which will be opened in October at Manesar,” he added.

Nissan has ambitious India plans

Despite slowing demand, Japan’s second-largest automotive company, Nissan Motor, is gearing up to launch a variety of passenger cars, vans and commercial vehicles in India in the coming months, including those through alliances. Though it has a substantial presence in other markets, Nissan is the 10th-largest car maker in India and is trying hard for a bigger share here. It has a little over one per cent market share in the passenger vehicle market.
 The company is looking to launch five new models, to be built at its factory in Chennai which it owns in partnership with Renault, stated chief executive Carlos Ghosn in the annual report. This is part of its global plan of delivering a new vehicle every six weeks, on average, during the next six years.

Evalia, a premium multi-purpose vehicle (MPV) that could be priced upwards of Rs 9 lakh, will be launched in India before December. After having launched the Micra compact hatchback and the Sunny sedan using a common platform, Nissan is presently working on at least one more product that would be using the same platform and to be retailed under its own brand.


It aims to strengthen the Nissan brand before launching a series of low-cost small car models under its other brand, Datsun, two years later. This new brand will be used for tapping newer segments, such as those in the price bracket of Rs 2-4 lakh.
Nissan presently has a mix of products — a small car (Micra), sedans (Sunny and Teana), a sports utility vehicle (X-Trail) and a sports car (370Z) — through local production and import. About 70 per cent of the production is exported.


“We are broadening our range of models for both the Nissan and Infiniti brands and eliminating product overlaps. More dedicated vehicles for key growth markets, such as China, Brazil, Russia, India and Indonesia, will allow personal mobility to become more accessible to those consumers who need it,” added Ghosn.
Meanwhile, Nissan’s joint venture with Chennai-based truck and bus maker, Ashok Leyland, will be taken forward to include more variants of the existing Dost, joint production of a MPV in Nissan’s plant and the launch of a new light commercial vehicle (LCV).


The LCV Dost, targeted at the one-tonne segment dominated by Tata Motors’ Ace, is the first vehicle developed and produced under the JV company. Following favourable demand growth for it, both companies are planning to add variants in the coming period. The slightly bigger LCV, the F24, called Cabstar by Nissan but Partner by Ashok Leyland, will be the other product to be launched next year. This product, more than six tonnes, is the intermediate commercial vehicle from the JV.


The multi-seater vehicle Stile from Ashok Leyland, developed on the same platform used by Evalia, will be produced at the Renault Nissan plant in Chennai for launch in 2013. This vehicle will be of a commercial nature, offered at a more affordable price point, similar to those of the Mahindra Xylo or Chevrolet Tavera.

V Sumantran, vice-chairman, Ashok Leyland, said at an interview given to an in-house media centre of Nissan, “I think we have already got the first three products lined up. The first one (Dost) has been launched and we already have many ideas for very good variants to come off that platform. The Evalia is close to the end of its development cycle, so it’s out in production very shortly. And, work is very well underway for the F24 as well. I think we feel confident so far that whatever the two companies have defined as a business plan looks within reach.”

Panasonic India Aims at 25,000 Crore by 2015

An optimistic Panasonic India said it would inject 1500 crore to touch the 25,000 crore turnover mark by 2015.

"The volume strategy for India which started in 2009 will continue further and we will invest $300 million (1,500 crore approximately) in the new plant and campaigns over the next three years," Panasonic India MD Manish Sharma said here during launch of personal grooming products.

"We have also set a target of $5 billion turnover (Rs 25,000 crore) by 2015 and $2 billion (Rs 10,000 crore approximately) in 2012-13," he added.

In 2011-12, Panasonic India was a Rs 5,500 crore company with 3,200 crore from the consumer divsion. In 2012, the consumer divsion alone would be Rs 5,500 crore, Sharma said. He said Panasonic's Indian operation would achieve
breakeven in 2012, but did not speak about its accumulated losses.

Despite attaining 70 per cent growth in the last year and targeting a similar trend in the current fiscal, the Indian operation was yet to make a profit because the company was in investment mode during the period, he said, adding that the problems in Japan for parent Panasonic Corporation did not impact Indian investments.

The new plant at Harayana would be operational in December and would produce air-conditioners and washing machines, the company said.

Introduction of personal grooming directly by the company with an entire range of imported products after five years when few products were sold in India through distributors, was part of youth and semi urban market strategy.
"The size of personal grooming market is Rs 200 crore," Sharma said.

Asked about launch of Panasonic smartphones in India, Sharma said there was no firm plan for it now.



Comic turf

The Japan Foundation has opened Delhi to the hidden world of anime from that part of the globe, with their exclusive one-of-a-kind Manga Café. Ektaa Malik pays a visit


They trace their origin to pre-historic times. They later conformed to the style developed in the archipelago nation of Japan. The latter part of the 19th century witnessed the development of the current form, which is now an international cult phenomenon.

Manga comics became collector items long ago. India was still to be part of the revolution.
While Otaku round the world grew in number. (‘Otaku’ denote obsessive fans of anime and Manga), India was waking up to the call. Now the Otaku have a watering hole in Delhi.
A Manga café created at The Japan Foundation.

“We would get repeated requests in the library for Manga comics over the years. But we only had ones in Japanese. It’s tough to get English ones in India. Then this year we decided to get a selection of English Manga and put them together for the café,” said Sangam Kumari, librarian at the Foundation.

The Manga Café has about 1000 books.

The café area features costumes of famous Manga characters. Small figurines are displayed in glass cases. The café is still in infancy. But demand is huge.  “We opened in April, after displaying books at Delhi Book Fair. People went crazy. The art form is so rich. The problems one has to go through to get access to them, make them even more popular,” explained Sangam.
She has been with The Foundation for five years. And was barraged with requests for Mangas in English. “The demand was there. But The  Manga Café has most popular Mangas stocked here. There is  Naruto, a series written on the adolescent  Ninja, who always wanted recognition. Then there is One Piece, about Monkey Duffy, a 17-year-old, whose body takes over qualities of rubber. After he ate a fruit with supernatural qualities. Black Butler is the serialisation of antics by Sebastian, a demon of sorts, contracted to serve his 12-year-old master.
“Black Butler is the current rage. Its hugely popular,” shared Sangam.
Manga might be the Japanese counterparts of comics, but don’t just stick to things targeted at kids. “Manga is on subjects as diverse as economics, sociology and culture. Even World War II has been written upon in the Manga format. So has history and Buddhism,” added Sangam.
The café has subscriptions of two weekly Manga journals — the Shonen Magazine and  Shonen  Jump.
These journals are the lifeline of Manga fans across the world, keeping them updated.
The age group of 10-20 is the biggest consumer of these Manga at the cafe.
The Foundation plans to expand soon. “Now we know the concept is hugely popular, we will bring more Manga and other things related to it,” concluded  Sangam. The café is open to members of the Japan Foundation library. But it’s relatively easy to join. One only needs a photo ID card and two photographs. The Manga Cafe is open between Tuesdays to Saturdays, from 11am-6pm.

Jharcraft items evoke good response in Japan

Handicraft products of the Jharkhand Silk Textile and Handicraft Development Corporation Limited (Jharcraft) get huge response at the India Show in Tokyo which concluded on Friday. A number of Japanese companies have shown keen interest in bulk purchase of Jharkhand items.

The India Show is an initiative of the Union commerce ministry to promote Brand India across the globe and provide a platform to Indian exporters to showcase their strengths in emerging markets and developing countries.
There has been high demand for hand embroidered organic silk stoles and neck ties. The companies like 3K Corporation and Blue House Corporation have shown interest in placing bulk orders, an official said.

Officials in the delegation, led by state tourism minister Bimla Pradhan, said apart from the big companies there were a large number of small traders and individual buyers. "The handicraft products of Jharkhand got a very good response and it is expected that we will soon get formal orders for bulk supply," said the official adding that the main reason for huge demand was the organic production of high quality silk and embroidery.
The official said Madhya Pradesh chief minister Shivraj Singh Chauhan and his cabinet colleague Kailash Vijayvargiya also visited the Jharkhand pavilion and was full of praise for the efforts taken by the Jharcraft for promotion of local handicraft.

Representatives of Nomura Research Institute India Private Limited and from various other organizations also visited the state pavilion.
Members of the delegation also attended a seminar on 'India-Japan Cooperation: Manufacturing, Engineering and Allied sectors' organized by the Japan India Business Cooperation Committee. The members also had a long interaction with managing officer of Toyota Motor Corporation who spoke on the opportunities in Indian manufacturing sector.

"The industrialists from Jharkhand got the opportunity to interact with the officials of Toyota Motor Corporation and understand Toyota's business activities in India and the immense scope which exists for the auto ancillaries of Jamshedpur," the official added.