Product innovation at V-GUARD Industries

1. VGUARD: Product Innovation
Babu Appunny
MBA, B Tech, Six sigma black belt
Babu_c_appunny@yahoo.com
+91 40 2713 0107

2. Disclaimer
I prepared this presentation and shared it with
V-GUARD team before I was interviewed for
VP (Electronics & Power Products) position,
the position at which I served the company
later. The presentation was not modified later,
except for this disclaimer page. The
presentation was prepared with the
information available at the public domain
and the information that I gathered on the job
has not influenced the presentation.

3. India energy trends
Huge energy supply/demand gap drives Inverter, UPS and solar
solution sales at 15% CAGR
• In 20 years India doubled it’s power capacity. But per
capita power is just 30% of world average.
• India will reach world average by 2040: 30 years
opportunity for stabilizer, Inverter, UPS and solar
energy solutions
• Higher purchasing power drives up UPS growth to 15%
and slows stabilizer growth to 0%
• 44% of houses in India has no electricity. With higher
purchasing power, they will turn to generator or solar
energy solutions
• The Jawaharlal Nehru National Solar Mission will
further push-up demand of solar energy solutions

4. VGUARD: Technology overlap diagram
Power electronics R&D can drive growth in multiple product lines with
great future growth
Power Electronics
Product lines
Solar Double
Solar water Inverter conversion
heater UPS
Offline
Geysers UPS Line
interactive
UPS
Stabilize
r
Cables
Pumps &
Fans Motors
New New
Legacy
product line proposal

5. VGUARD: opportunity comparison
Owing to the higher barriers and better profit margin Double
conversion and solar solution offers best returns
Growth Entry barrier Remarks
Geysers Low barrier
Solar water heater 20% Low barrier
Stabilizer ~0% Low barrier
Single phase UPS 15% Medium: capital and technology barrier Price war
Double conversion UPS High: capital and technology barrier Premium price
15%
Offline UPS 15% Medium: capital and technology barrier Price war
Solar inverter 10-15% High: capital barrier and new technology Premium price
Pumps & Motors 8% Medium: capital barrier
Fans ~5% Medium: capital barrier
Cables >5% Medium: capital barrier -medium
Inverters for farmers ? Medium: capital and technology No
competition as
of now

6. Benefits of solar inverter and
double conversion UPS
• At 6% company’s profit/revenue is below industry leaders
• Geysers, Sola water heaters, cables, stabilizers, pumps &
motors and fans are legacy low profit businesses
• Share price stabilized around 200. Unless profitable product
lines added, share holder expectations cannot be met
• High barriers of entry drives higher profit in solar inverter
and double conversion UPS
• V Guard, well recognized brand, can successfully make huge
bets in the market
• Investment in Power Electronics R&D can drive new
products in multiple product streams, reducing overall R&D
investment

7. Backup

8. Financial benchmarking