Videocon, a company that was once one of the biggest manufacturers of electronic goods in India has put its assets on sale. In a newspaper advertisement, the company has invited resolution applicants to buy assets of companies in multiple locations including Karnataka, Maharashtra, Gujarat, Telangana, and Rajasthan. What is amusing in this advertisement is the choice of words. The advertisement read, "An opportunity to acquire ready to use Indian manufacturing facilities and contribute to making India 'Atmanirbhar' that is in reference to the government's call to manufacture locally. Twitteratis were quick to call out the ad on social media platforms accusing the company of fraud.
Notably, Videocon is the company against which the ED is investigating a case of taking fraudulent loans from ICICI Bank. Almost all of its have been sacked without getting a single penny. Videocon was once the best-performing company in India with a standalone profit of profits of over Rs 800 crores with a focused approach in the consumer electronics business during three financial years until September 2008.
Videocon, an Indian company shutting down and selling off its own assets, on a paper ad today, says "an opportunity to acquire ready to use Indian manufacturing facilities and contribute in making India 'atmanirbhar' ".— Tinu Cherian Abraham (@tinucherian) June 10, 2020
What an irony! pic.twitter.com/qdfsbzL1y4
Videocon's debt jumped due to its failed telecommunications services business wherein the company lost about Rs 7,000 crore and another Rs 4,000 crore for upgrading the picture tube plant in Gujarat. The company's' earnings tanked due to stiff competition against global rivals like LG and Samsung. The troubled Videocon Group has admitted to astounding outstanding to various lenders including public and private banks amounting to more than Rs 90,000 crore, making it perhaps the biggest corporate bankruptcy case in the country's banking history.
Videocon: From riches to rags
The company started in 1985 and become the first local manufacturer to get a license to manufacture color TVs. During the next decades, the company extended its products and started manufacturing products like air conditioners, refrigerators, and home entertainment systems to their offerings. Riding on his ambition, its founder Venugopal Dhoot ventured into uncharted territory and established business in Oil and Gas, Telecom, Retail, and DTH services. Unfortunately, the capital intensive nature of its business led to the company not making as much money as it desired and took huge loans for its new businesses which failed to take off. The company was admitted to NCTL for resolution in January 2018.