New Delhi: Sony India, the local subsidiary of Japan’s renowned Sony Corp, is poised to achieve a significant revenue milestone of $1 billion in its consumer electronics business for this fiscal year, according to Sunil Nayyar, the managing director of Sony India, in an exclusive interview with Mint.
This achievement comes as part of Sony’s strategic initiative to diversify its revenue streams beyond its traditional television offerings, especially in light of the increasing consumer demand for high-end, premium products. Nayyar highlighted the company’s impressive resurgence in the post-pandemic era, marking exactly 30 years since its establishment in India.
Steady revenue growth
“In the last two fiscal years, we’ve consistently witnessed revenue growth exceeding 20% year-on-year,” Nayyar remarked, attributing this increase primarily to a refined focus on a streamlined portfolio of television products. He elaborated that sectors such as audio, imaging, and gaming have become strong growth drivers in the consumer electronics arena. “As a result, we are on track to achieve $1 billion in annual revenue for the first time as Sony India and aim to position this region within the top three worldwide for revenue generation,” he added.
For the current fiscal year, Sony India’s sales have already reached ₹7,664 crore, approximately $900 million, with the company preparing to file its latest financials soon with the Registrar of Companies.
It is important to note that Sony India Private Ltd does not encompass the company’s motion picture and entertainment ventures like Sony Pictures and Sony Music Group, nor does it include the engineering development sector that operates under Sony India Software Centre. The core operations of Sony India focus primarily on consumer electronics, with television sales being the major revenue contributor.
“Historically, our primary revenue driver has been televisions, our flagship product, enabling us to secure the top market share in televisions sized 50 inches and larger. However, the landscape has shifted; we’ve reduced our reliance on televisions from nearly 80% three years ago to approximately 55-60% of our revenue today,” Nayyar explained, highlighting a noteworthy transition in the company’s business model.
This decline in the televisions’ contribution to overall revenue should not be misconstrued as a slump in sales, Nayyar insisted. “We have strategically streamlined our product offerings, discontinuing budget-range and smaller screen televisions. By embracing a premium brand strategy, we have distanced ourselves from fierce competition with Asian counterparts in budget segments,” he mentioned.
In the past two fiscal years, Nayyar’s emphasis on selling high-end televisions has corresponded with the expanding market demand in that segment, yielding greater revenue and profit margins. “Last year, our strategy bore fruit as we achieved a net profit of ₹225 crore, translating to a margin of over 3%. This current margin reflects significant investments in marketing initiatives aimed at bolstering sales,” he stated.
“Such successes have motivated us to intensify our market investment in India, utilizing brand ambassadors to promote our offerings in the television and imaging sectors,” Nayyar added.
Considering the broader scope of its operations, Sony India’s billion-dollar revenue target aligns with its diversified presence in the consumer electronics landscape. “While televisions surface as 55-60% of our revenues, our digital imaging division—particularly full-frame and professional mirrorless cameras—constitutes 15-20% of this figure. Meanwhile, audio products contribute 10-15%, and the gaming sector, bolstered by the PlayStation 5, accounts for about 10-12% of our annual revenue in India,” Nayyar elaborated, indicating a balanced portfolio aimed at sustained growth.
Celebrating three decades in India, analysts highlight that Sony has maintained strong brand recognition among consumers. “Sony’s brand continues to resonate with buyers, particularly in the television sector, where it ranks among the top four brands despite withdrawing from the mass-market budget category. Although it lacks the iconic status that Apple enjoys, it stands as a well-respected legacy brand, albeit in a market aggressively dominated by Chinese players like Xiaomi, along with Samsung and LG from Korea,” remarked Navkendar Singh, associate vice-president at International Data Corporation (IDC) India.
IDC’s data on India’s smart TV market indicates that Sony holds a fourth-place position, trailing behind Samsung, LG, and Xiaomi. However, early fiscal year statistics reveal that Sony’s TV sales outstripped the overall industry growth—where 1.8 million smart TVs were sold in April and May, marking an annual growth of 12.5%, Sony India saw its TV sales surge by 27% on a year-on-year basis. As of May, the company commanded a 9.6% share of India’s smart TV market, up from just 6% three years ago.
Nayyar also confirmed that there are no plans for Sony to re-enter the smartphone market, from which it distanced itself five years ago due to declining market share amid heightening competition. “While we never rule anything out, there are currently no definite plans for our re-entry into that sector,” he clarified.
Analyst Singh reiterated that Sony’s business strategy might not align with the aggressive risk-taking required for survival in India’s densely populated smartphone industry, making a comeback unlikely in light of the current market saturation.
Despite this, Sony India remains optimistic that its emphasis on premium products will yield positive results in the foreseeable future. “Our consumers gravitate towards our televisions not just for their technology but for the recognizable premium standards we uphold. Several years ago, we deviated from our core strengths in a bid to compete in the price-driven segment, which ultimately underperformed. Today, we choose to deliver exceptional value through high-quality televisions. We project continued double-digit growth for at least the next two to three fiscal years,” Nayyar concluded, outlining the strategic path forward for Sony India.
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Owner of Sony TV India
**Interview with Sunil Nayyar, Managing Director of Sony India Private Limited**
**Host:** Welcome, Sunil! It’s a pleasure to have you here today. Congratulations on the significant milestone you’re approaching with Sony India’s consumer electronics business. Can you share what achieving $1 billion in revenue means for the company and your strategic vision?
**Sunil Nayyar:** Thank you! Reaching $1 billion in revenue marks a pivotal moment for Sony India and reflects our enduring commitment to innovation and quality. This achievement not only demonstrates our ability to adapt to market changes but also highlights our strategic focus on diversifying beyond traditional television offerings to meet evolving consumer preferences.
**Host:** That’s impressive! You mentioned a growth of over 20% year-on-year in the past two fiscal years. What factors have contributed to this remarkable growth?
**Sunil Nayyar:** The growth can be attributed to our refined focus on high-end products in categories such as audio, imaging, and gaming, alongside a streamlined television portfolio. We’ve shifted our strategy from budget offerings to premium products, which resonates well with consumers seeking quality. This pivot has allowed us to gain higher revenue and profit margins, particularly in high-end televisions.
**Host:** You’ve indicated a decline in reliance on televisions for revenue. How has this transition impacted Sony India’s market positioning?
**Sunil Nayyar:** Although televisions still represent 55-60% of our revenue, this strategic shift has robustly positioned us in the marketplace. By reducing our focus on low-margin products and emphasizing premium models, we’ve distanced ourselves from fierce competition in the budget segment. This transition has been instrumental in our growth strategy, leading to a stronger brand presence and market share.
**Host:** Speaking of brand presence, as you celebrate 30 years in India, how does Sony maintain its relevance in such a competitive market?
**Sunil Nayyar:** Our brand recognition and legacy play a crucial role in maintaining relevance. Despite not competing in the mass-market budget category, we ensure our premium brand ethos resonates with consumers. With targeted marketing initiatives, we leverage brand ambassadors to promote our flagship products, which helps solidify our position in the consumer electronics landscape.
**Host:** what are your expectations for the future of Sony India, especially in terms of innovation and market penetration?
**Sunil Nayyar:** As we pave the way for sustained growth, we aim to further enhance our presence in the consumer electronics sector by continuing to invest in technological advancements. Our goal is to be among the top three regions globally in revenue contribution. We will keep pushing the boundaries of innovation to cater to the premium market, ensuring that Sony remains a name synonymous with quality and trust in India.
**Host:** Thank you, Sunil, for sharing these insights. We look forward to seeing how Sony India evolves in the coming years!
**Sunil Nayyar:** Thank you for having me! It’s an exciting time for us, and we’re eager to share our journey with everyone.