Having exited shareholding in Luminous Power Technologies, SAR Group founder Rakesh Malhotra is set to re-enter the inverter battery segment in India once the non-compete clause (NCC) with Schneider Electric expires in October this year. The inverter battery business will be launched under the entity Livguard Energy Technologies that is already into products such as automotive batteries, inverters, power backups, mobile accessories, stabilisers and solar renewable energy.
Speaking with DNA Money, Malhotra said, “The non-compete clause on inverter battery products will expire in October 2018. We know this space very well and have all the expertise to replicate the success. We have the necessary infrastructure in terms of a manufacturing facility, distribution network, an established brand 'Livguard'. So we will re-enter this space soon.”
A global specialist in energy management and automation, Schneider had acquired the balance 26% stake in Luminous held by Malhotra and other founders in January 2017. The French major had bought 74% in Luminous back in May 2011 for around $310 million.
“We renamed the company Livguard after fully exiting Luminous. We are taking a cooling period before we completely get out of the non-compete agreement and will restart the process. The re-entry will happen towards the end of the current calendar year or early next year,” said Malhotra.
The Livguard business, according to Malhotra, is already enjoying a run rate of $150 million in revenues and is currently clocking over Rs 100 crore in monthly revenues. “It's a much bigger business and we have had a very successful run with it in the market. While, established brands (Exide, Amaron, etc) have been operating in this space for decades now, we have managed to garner a good share of the market despite being a new entrant,” said Malhotra.
Pegged at around Rs 30,000 crore, Malhotra said, the overall industry is set to grow at 10-12% annually for the next 25 years. “While high entry barrier is a key challenge, if a player is still able to make a foray and position the brand and offerings in the right manner, the opportunity is very large,” said Malhotra, adding that it's a very attractive space and treated at par with other consumer businesses and not like an auto parts/components business.
SAR Group, the progenitor of brand Luminous, is a leading global company delivering power products for home and commercial applications. Its portfolio comprises purity, health and wellness, energy storage, home electricals, renewable energy, power backup and power storage, renewable and alternate energy solutions such as biomass pellets and solar.