Incorporated in 1986 as a specialist manufacturer of standard wire wound resistors with basic technology acquired through Samsung Co Ltd, Hi-Tech Resistor Pvt Ltd has currently transformed itself into a manufacturer of wire wound, fusible and low ohm/current sense resistive devices, with state of the art design and testing capabilities. In an interview with Srabani Sen of Electronics Bazaar, Areez Patel, director, talks about the current trends in the resistor market, the challenges faced by resistor manufacturers in India and some possible solutions.
EB: What are the current trends in the global resistors market?
In the lower wattages, that is, up to 3 W, there is now a distinct trend towards SMD devices. Above 3 W, which is the power resistor segment, there is now an increasing demand for UL approved fire retardant coatings and fusible resistors.
Another distinct but separate trend is the requirement for pulse resistors as per IEC 61000-4-5 and current sense resistors for the inverter segment, for solar applications.
EB: Are all these trends discernable in India as well?
As India is now, to a large extent, linked to the world, both economically and on a technological front, we are seeing the above trends coming to India as well. But the pace of the changeover is quite slow, especially in the SMD segment, where higher prices do not justify the changeover to SMD due to the lower labour costs in India, which allows the PCB assembler to still use through-hole products.
EB: How are the Indian resistor companies countering the challenges being posed by the Chinese companies in India?
As far as Hi-Tech Resistors (HTR) is concerned, we have not faced any particular challenge from China as most of our business involves supplies against ‘design in’ products, which have been specially engineered to suit a particular application. The Chinese resistor companies’ main strength is their ability to mass produce a standard product cheaply and efficiently, leveraging a steady currency, reliable infrastructure and power; their ability to borrow at economical rates and, of course, a disciplined workforce which is cheap when compared to India—if linked to productivity.
EB: Pricewise, where do Indian products stand compared to the Chinese resistors?
If one is to make a standard product in India, very often the prices of the China made resistors are just a little more than the cost of raw materials alone. Hence, we do not concentrate on this segment.
EB: How do you compete with the Chinese resistor companies?
HTR concentrates on a different segment, and our main competition is with the European and US based multinational resistor companies. We are able to compete successfully with them as we have invested heavily in quality assurance and specialty equipment, which helps us to design specific resistive devices for a customer’s specific application.
EB: What are the major challenges being faced by resistor manufacturers in India? What, in your opinion, could be the solutions to these challenges?
The problems we face are no different from other small scale and medium scale manufacturers in India. If labour and land reforms were forthcoming from the government, this would, of course, go a long way in helping us compete better on an international level.
EB: How was the last FY for Hi-Tech Resistors?
In 2011, our business in the European Union (EU) market grew by 10 per cent as compared to 2010; and it grew by 25 per cent in India, China and the Far East. In 2012, due to depressed market conditions in most of the markets, we anticipate an overall growth of 5-7 per cent.
EB: What are the marketing strategies you have adopted to stay ahead of your competitors?
We are trying our best to shorten the ‘design in cycle’ from receipt of enquiry to supply of initial prototype samples to a customer’s specific requirements—from six weeks to three weeks. Further, we plan to optimise our website so that customers can track their orders online.
EB: In which sectors in India do you see the maximum demand for resistors?
Since HTR exports more than 50 per cent of its production to 35 countries, we can only comment on the few segments that we concentrate on in India, and out of these, we see maximum growth in the power supply segment with the accent on inverters in the solar industry.
EB: Do you intend to expand your manufacturing facility?
As HTR has now transformed itself from being a manufacturer of power resistors, mainly for the industrial sector, to a significant designer and manufacturer of resistive devices for the automotive sector, we are constantly investing approximately 10 per cent of our turnover in new equipment for these new products.
EB: What are the technological advancements happening in your products?
There is a constant search for materials that are more thermally efficient for better dissipation of heat, and without the toxic disadvantages of beryllium oxide in ceramics.
EB: Do you plan on any joint ventures?
At present, there are no particular plans in this direction, but we are always open to working together with our competitors in segments and areas where there can be a win-win situation for both the partners.
EB: What are your future growth plans?
We intend to significantly expand our footprint in the automotive sector, with both noise suppressor resistors and climate control (HVAC) resistors. We have a number of ongoing projects in these sub-sectors and a number of projects that are in the ‘design in’ stage; so we hope to see these projects going into regular production soon. Further, we plan to also use our extensive worldwide distributor base to expand our volumes in our new line of fusible resistors, which are certified by UL 1412.