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More on Photoquip

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Hi All

This is to reply on some comments I have received. You’re welcome and hope it makes money for all of us.

Photoquip is a distributor for Elinchrom’s Swiss products but it also manufactures products for Elinchrom’s worldwide sales in India. I am told sales are sustainable and I am gullible enough to believe it, again results will tell whether we are wrong. I like their move into entry level equipment.

If one goes through the photographer blogs and discussion forums world over and you will know that top brands are Profoto, Elinchrom, Broncolor, Bowens and Alienbees.

Elinchrom has been widening moat against Profoto and Broncolor which are very expensive due to European labour rates and possibly image they wish to retain. In last couple of years Elinchrom has started gear at lower end with a new brand name called D-Lite for beginners, gear would still be around 1 lac INR. Compared to those by Broncolor and Profoto and Elinchrom’s high end, around 5 lacs Rs.

You have to concoct an an experiment in your mind and visualise how many professional photographers will use this product, the gap globally has been huge, not only between top and low end, but also middle segement, which Elinchrom filled with Quadra Ranger couple of years back. Its simply a company that is ahead of curve.

Secondly, as Indian market matures, Photoquip does not need to burn R&D to invent new products, product line is universally ready to be used given the purchasing power increases, unlike what other companies need to do. Hawkins has had to learn to come into cookware, Agrotech Foods cannot introduce global products due to different palate preference in India.

Go through these very ordinary blogs/reviews:

Elinchrom Catalog

Elinchrom Product Chart, out of which I suspect only 25% is consumed in India at present

What am I doing with Photoquip ? If I had more money I would have bought 14% of the company without triggering open offer, so I am accumulating gradually with monthly savings.

Since my horizon is relatively long term and I dont care if it goes nowhere for a year or two, in general its best to add to rising positions especially as a trader. You can give it another 12 months to prove itself.

I must add that Photoquip floundered and lost all the money it made from Elinchrom, between 1998 and 2004 by introducing tech products, Gretag Masterlab ( Gretag went bankrupt), Clik cameras (became obsolete). Pretty much what you would expect from a protean tech universe. Its amazing to see how much money is wasted by corporate di-worsefication into unknown ventures. I hope they resist the urge to di-worsify.

Ballarpur Industries which I know quite a lot about wasted more than 3000 crores into various ventures (from leather, to household door, bricks, you name it) from its flagship paper business.
Had they stuck to their original line of business they would be multi billion dollar business. All the same even more amazing to notice 3M at top of their game in diversified businesses and producing over 55,000 products.



Written by amitdipsite

October 5, 2010 at 10:27 pm

Posted in Uncategorized

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