Varroc are a relatively new company, founded in India in 1990 by the current Managing Director Tarang Jain with their father Naresh Chandra as Chairman and non-executive Director. The company started activities with plastic parts, then electrical and metallic parts for the Indian transportation industry—particularly for two wheelers. Varroc then extended their activity to lighting in India, still mainly for two- and three-wheelers, this being still today in India their core business for lighting. Varroc are currently the two-wheeler lighting leader in India. Global sales of Varroc group in FY17-18 are at €1.24bn ($1.43bn), supported by 36 plants and 16 R&D Centres round the world.
For the lighting business which is now the main activity of Varroc Group with 61% of sales, the main development occurred in 2012 with the acquisition of the lighting activities of Visteon, boosting at that time the global turnover of Varroc above $1bn and allowing them to become a major participant in the international vehicle lighting industry.
Varroc had strong growth during the last five years at +14% per year, but with an acceleration in the last quarter reported at +28% thanks to internal growth and acquisitions. Varroc’s lighting market share is around 4% worldwide, and Varroc say they’re currently the 6th lighting set maker worldwide, targeting to rise to third or fourth. Varroc still hold the strong positions with customers held before by Visteon, particularly with Ford and Jaguar Land Rover.
But Varroc have also expanded their activities thanks to a good cost competitiveness mainly due to their locations in low-cost countries naturally in India, as well for global business in Europe in Czechia and Poland, and in North America in Mexico. During the last twelve months, Varroc have accelerated their globalisation with new production plants in Morocco and Brazil, new R&D centres in Czechia and Poland, new activities in small lamps with the acquisition of Sa-ba in Turkey and Bulgaria and new sales centre in Japan.
Varroc are not only supplying low cost products; they also have developed high technology systems for instance LED Matrix ADB for the Jaguar E-Pace, Matrix ADB with laser high beam for the Range Rover Sport or Matrix ADB for the Bentley Continental. These developments were realised in close cooperation with some key suppliers that is a part of the Varroc strategy to accelerate their offer for high-tech products despite a relative lower level of resources compared to their main competitors.
Varroc want to be part of the high technology leaders and for that are increasing R&D resources at a strong rate of 150 new R&D engineers per year. Varroc have for instance announced soon the production of low-cost LED reflectors systems and are developing high definition ADB system with up to 1.3 million pixels. But the central strategy of Varroc Lighting Systems to develop their business is “to bring leading edge technology to the mainstream markets with high quality, cost competitive solution”.
Varroc are very ambitious for the future, wanting to be one of the three main lighting suppliers in the world. Varroc have some important strengths: a central location in India, likely the “next China” for mass production of cars; a relatively large number of plants and R&D centres in low-cost countries, a global presence, and improvements for developments of high-tech products. Varroc can also rely now on a new financial support as they have in 2018 introduced the parent company Varroc Engineering in the Indian financial market, so they can continue their quick pace for acquisitions or be part of a future important merger.
Nevertheless, this path to become part of the top three could be relatively long as Varroc are still today relatively small compared to their five main competitors that are currently about three to five times bigger and still growing.