aravind melligeri: Aequs founder Melligeri seeks PLI for toy manufacturing, plans IPO after 5 years

Aravind Melligeri, the American founder of Aequs, an Indian contract manufacturer, has sought production-linked incentives (PLIs) for the toy and durable consumer goods industries to boost exports and create jobs.

Aequs is developing the country’s first and largest toy manufacturing cluster, spread over 400 acres in Koppal, Karnataka, in addition to a consumer durables industrial park in Hubballi.

The Aequs, headquartered in Belagavi, is wholly owned by Melligeri and members of his family. Koppal’s next plug & play facility will soon house four toy units, including two by Aequs itself. While Viscon Polymers is ready to commission its unit that will manufacture toy parts, other units are at different stages.

The Koppal plant, the Aequs founder told ET, is a perfect fit for global toy brands looking to branch out from China as part of their China Plus One strategy. Koppal provides plots on a lease basis to manufacturers, he said.

Melligeri, who hails from Hubballi, said Chief Minister Basavaraj Bommai has been very supportive of his initiatives and has been pursuing with the Center to secure the benefits of the LIP for them.

He is optimistic about the future consumer durables group at Hubbballi, which, when fully commissioned, will reduce India’s dependence on China for the supply of such products.

Melligeri, who co-founded Quest Global with friend Ajit Prabhu, spun off the manufacturing business in 2014, took it private and named it Aequs. His 260-acre precision engineering SEZ in Belagavi is now 13 years old.

He sees huge opportunities for Indian toymakers, as the global market is worth around $100 billion, and Chinese manufacturers account for four-fifths of that, and most of the rest by Vietnam.

“India exports toys worth around $150 million, and Melligeri aims to contribute significantly through the Koppal Toy Cluster to boost exports to $1 billion over the next five years. . However, he is looking for the right policy interventions to achieve this. Every million dollars in revenue, he said, can create 100 jobs.

India’s toy industry is estimated at around $1.5 billion, and experts say it can double with the right political support.

It is a global toy brand that encouraged Melligeri to create a huge toy cluster in Koppal. Making toys in Karnataka, he estimated, was cheaper than in China because “our labor costs are one-third of China’s and half of Vietnam’s”, he said. -he declares.

Regarding the availability of skilled workers, Melligeri said he had already established links with the state government and they were already training thousands in Koppal.

“Aequs is both an OEM and ODM manufacturer. I do not compete with brands. We are not a brand, but I want to supply all brands of toys and durable consumer goods in the world,” he said.

Private equity players have already offered to invest, but Aequs will consider such offers after some time, Melligeri said, adding that he plans to take his company public after five years.