Bajaj Electricals wants to shut down

What led to the establishment of Bajaj Electricals?

The business in its present form originated from the acquisition of Radio Lamp Works by Kamalnayan Bajaj in 1938. The company distributed Italian-made radio lamps. Due to supply disruptions during World War II, it set up a factory in Shikohabad (Firozabad district, Uttar Pradesh) to manufacture these locally. This unit became Bajaj Electric in 1960.

What was the focus of the company in the early years?

Kamalnayan Bajaj had the vision of creating a marketing umbrella for the small scale industry sector. These businesses were efficient, hard-working and enterprising. However, they lacked adequate funding, branding and marketing strength and this is where we added value. We supported over 100 small scale industries by sourcing their products, branding them under Bajaj and distributing them across the country. That was the original idea.

While Bajaj Electricals now has a large portfolio, how did you source and market new products in the early years?

Although it was a small company, we entered into a joint venture (JV) called Hind Lamps in 1951 with some of the leading lighting companies of the world. Bajaj Electricals held a 50 percent stake, while the rest was owned by four European companies – Philips, General Electric, Crompton Parkinson and Associated Electricals. Despite our humble beginnings, Kamalnayan Bajaj was able to form a joint venture that manufactured general lighting service lamps. In addition to lighting products, the company also expanded into instruments, fans, electrical goods, and industrial components by the 1960s.

In recent years, competitors have overtaken Bajaj Electricals. How do you plan to combat them?

Yes, it is true that our peers in the FMEG sector have done well, while we were slow to react to the changing market dynamics. However, we believe that with a new team of professionals, we will regain our position. From 2026-27, you should expect Bajaj Electricals to register a faster growth rate.

Our core strengths lie in distribution and marketing, and we have built a portfolio of strong brands over the years. Apart from Bajaj and the recently acquired Morphy Richards, our brands include Nirlep and Nex. Our focus is on understanding market and consumer preferences while increasing investment in Research & Development (R&D) and product development. We have also diversified into new product categories and are leveraging our existing distribution network to expand the portfolio while saving on overheads.

Is there a need to focus more on manufacturing and product development along with expanding your portfolio?

Unlike our competitors, who have a much larger manufacturing footprint (over 70 per cent), our manufacturing contribution has historically been 20-30 per cent. We have preferred an asset-light model, as it helps us insulate us from sudden technological changes. Our core strength remains distribution and marketing. We have built a portfolio of strong brands over the years, including Bajaj, the recently acquired Morphy Richards, Nirlep and Nex.

We have increased our focus on R&D, with the stipulation that new products and variants should improve margins. We are also using artificial intelligence to reduce product development timelines and improve operational efficiency.

Why was there a need for restructuring of Bajaj Electricals?

The engineering, procurement and construction (EPC) business of Bajaj Electricals was demerged to form Bajaj Projects. As a result, Bajaj Electricals now focuses on consumer products such as appliances, fans and lighting, while Bajaj Projects caters to the business-to-business segment. Since the EPC business is working-capital intensive, individual units will be in a better position to manage capital allocation decisions. Additionally, the demerger has unlocked value by creating two listed entities, giving investors the option to invest in either the consumer durables company or the EPC business.