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Samsung India sees 30% revenue growth

An Indian unit of South Korea's Samsung Electronics expects revenue to grow by 30 per cent in 2008, says an official.
Reuters | By HT Correspondent, New Delhi
UPDATED ON APR 01, 2008 05:30 PM IST

An Indian unit of South Korea's Samsung Electronics expects revenue to grow 30 per-cent in 2008 on the back of new models and rising incomes, a senior company official said.

Samsung India Electronics Pvt Ltd, which makes refrigerators, air-conditioners, washing machines, televisions, computer monitors and printers, had posted revenue of $1.3 billion for 2007.

"(The growth) will be driven by new models," Deputy Managing Director Ravinder Zutshi told reporters, after launching a new line of refrigerators and microwave ovens.

He said a proposed increase in salaries for more than three million government employees in India would boost demand for consumer durables and appliances.

"They will have extra money, (and) looking at the current market, they will spend it," Zutshi said.

India's slowing economic growth and accelerating inflation were unlikely to dent demand for the company's products, he said.

The annual inflation rate climbed to 6.68 percent in mid-March, the highest since a two-year peak of 6.69 percent in January last year, largely due to a spike in world prices of food, oil and metals.

India's economic growth is expected to slow to 8.1 percent in the fiscal year ending in March 2009; a Reuter’s poll showed last week. The government expects growth in 2007/08 at 8.7 per-cent, sharply below 9.6 percent in 2006/07.

"We don't see them as a concern. There is not much slowdown in frost-free refrigerators, automatic washing machines or televisions," Zutshi said.

Samsung had recently raised prices for some products because of rising steel and copper prices, and Zutshi said there would not be any further increase "immediately".

The firm will invest $10 million to expand consumer electronics assembly lines and products in India in 2008. Another $2 million will be spent on research and development locally, Zutshi said.

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