HCL Peripherals to enter memory business

New Delhi

September 3rd, 2007

Dismissing all reports that HCL Peripherals is going through a rough patch,
due to the constant changes in the top management, S Balaji, Deputy GM of the
company instead revealed that the company would soon be entering the cutthroat
memory market. Besides this it is also considering on manufacturing the hard
drives and flash drives. Plans are being drawn up on the procurement and
distribution model as well as the go to market strategy for this line of
products.

Other than this, he added that HCL Peripherals has a lot of other initiatives
on its plate for this year. It will added more teeth to its 'Small OEM' program.
Under this program, any systems integrator can place an order of over 200
products with HCL and the latter will brand these products under the SI's name.
"This program has been operational for sometime now. But we have not talked
much about it. Now, we want to take it ahead on a larger scale," Balaji
claimed. The reason HCL is banking on this initiative to succeed is because it
believes that SIs can sell monitors under their own brand name as it creates a
good branding exercise for them and they can sell it at a premium.

Talking about the restructuring in HCL Peripherals, he stated that the
company has created three verticals for the betterment of its business. These
three verticals would be display, networking and technology. Sarang Babu would
oversee the display business while V Venkatesan would handle the networking
segment, while Balaji is in charge of technology. The company would focus on
display and networking this year. "The market for networking is booming and
we have bagged some good orders. So we decided to concentrate more on that along
with the display sector," Balaji said.

He also declined that the current market perception that HCL Peripherals'
input device business is not been doing as well as its other business lines. He
talked about the recent launch of HCL's combo pack, which includes an USB
keyboard and an optical mouse, as well as the Diamond keyboard range. "We
have sold over one-lakh Diamond keyboards and are expecting some more orders.
Though our channel did not have a good time with this, we had a good turnover
through our OEM partners. Only recently we launched our 19 and 22-inch TFT
monitors. Without good response we would not have done this," he explained.

HCL Peripherals also hopes to increase the channel's contribution to its
overall revenues. Currently, the channel contributes around 20-25 percent to the
entire turnover. "This is not at all a small contribution, as getting
revenue through the channel is always difficult. But we have managed to have a
good margin. We hope this to improve in the coming years, as we have had a huge
order through our channel very recently," Balaji added.