Sources close to the company say LG Electronics may report profit of Rs 40 lakh at the end of 1998.

The company is also expected to exceed its sales target of Rs 400 crore for 1998 and may close the year with Rs 450 crore. LG Electronics had launched its products in the country in May, 1997, and notched up sales of Rs 125 crore in the first eight months of that year.

The company has now set a target of Rs 650 crore for 1999, and by year 2005, it expects Rs 2,500 crore from the electronics and durables business.

In keeping with its ambitious plans, LG Electronics India proposes to establish more manufacturing units and at the same time expand capacity of those already established. This includes a refrigerator manufacturing unit beyond year 2000.

Additionally, the company is planning to enter newer product categories such as vacuum cleaners. A team from LG headquarters is currently here to study the market for vacuum cleaners.

LG Electronics India vice president (sales and marketing) Rajeev Karwal said fresh investment to the tune of $25 million would be injected into the local operations next year to augment its facilities here. In the following year, additional $70 million is proposed to be invested as per plans finalised recently.

The vacuum cleaners may be launched next year, prior to the setting up of the refrigerator facility where the product is proposed to be manufactured. The company may consider an option of importing kits of vacuum cleaners to locally assemble them for launch here. "We are looking at the market very carefully," Karwal said. The company expects the vacuum cleaners to take off the same way as the washing machines market.

The local subsidiary of the South Korean conglomerate is planning to kick off production of monitors at its colour televisions facility next year. LG Electronics India proposes to manufacture about 1,50,000 units in 1999.

Karwal added that the company is working on increasing the indigenisation level of its products. It has already achieved indigenisation level of 55 per cent for televisions, 40 per cent for semi-automatic washing machines and 35 per cent for airconditioners.

The company will commence manufacturing microwave ovens in January, 1999, at its site at Greater NOIDA, near Delhi. Besides, expansion of colour televisions, airconditioners and washing machines facility is planned to be taken up from next year.

LG Electronics plans to double the capacity to manufacture these products. At present, the company has capacity to manufacture four lakh colour televisions, 50,000 airconditioners and two lakh washing machines.

The company, meanwhile, has finalised a host of products for launch in the market next year. These include voice activated microwave oven, packaged airconditioners with plasma air purifying technology, flatron television, clutch-free fully-automatic washing machines, deluxe intelligent optimum silence (DIOS) refrigerator and digital eye swing televisions.

Karwal said the packaged airconditioners are due to be launched in January next year, the DIOS side-by-side refrigerator in March, the clutch free turbo drum washing machine in June and the flatron television which has zero curvature picture tube by October, 1999. The "talking" microwave oven will be launched around October next year.