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Smart Automation Bets On Commercial Automation

While the company pegs the home automation market at Rs 150 crore, it is betting big on the commercial automation market with ticket size from Rs 1 crore to Rs 3 crore

Gurgaon-based start-up, Smart Automation, a provider of automation solutions, is counting heavily on the commercial automation business. The company that started in 2012 is targeting to double its revenue from $0.5 million in 2013 to $1 million in 2014, despite the slow market conditions.
As networking is the backbone of automation projects, we are looking for networking solution providers as our natural choice for channel expansion

While the company pegs the home automation market at Rs 150 crore, it sees commercial automation market as huge opportunity. “With the government mandate for commercial buildings to implement intelligent building management systems (IBMS), the opportunities have increased manifold. Also with upcoming malls and business hubs, the commercial market is huge with ticket size from Rs 1 crore to Rs 3 crore. The deal size for home automation averages between Rs 2 lakh-Rs 10 lakh,” informed CP Singh, Founder and Chief Mentor, Smart Automation.

Currently, home automation contributes 80 percent to Smart’s revenues and the rest comes from commercial automation. The company, however, expects commercial contribution to increase to 50 percent of the revenues in the next two years.

Smart offers automation solutions from Honeywell, Schneider, L&T, Control4, Panasonic and Samsung. It also offers its own brand (KlugKraft) of wireless automation solutions.

According to Singh, the demand for automation starts with safety and security. Another primary driver is savings on electricity bills. “Most of the customers start with surveillance cameras and then go for access control, electricity optimization, temperature control, and curtain and audio-visual automation.”

The company has executed 4 commercial projects involving electricity optimization and surveillance, and has 4 projects in execution. “We are executing projects for a travel company, a large club, an IT-ITeS company and for an airport, collectively valued at Rs 4 crore,” informed Singh.

In the home segment, Smart executed 35 projects in 2013 and has 12 projects in execution. The average value of these projects is Rs 4 lakh with an execution cycle of 6 months to a year. “We also have 4 large projects worth Rs 1.5 crore each for group housing societies but are not considering them in the revenues as the execution-cycle is 5-6 years long,” he added.

For revenue growth, Smart has robust plans for expansion. The company is targeting to set base in about 30 cities like Ahmedabad, Chandigarh, Pune, Udaipur, Jaipur and Hyderabad in the next two years. “We are looking at tier-2 cities which are witnessing major development in real estate. These cities are seeing lots of malls, business hubs and IT-ITeS companies coming up. Moreover, many of the upcoming residential buildings are opting for automation,” elaborated Singh.

The company is also looking for IT partners who have domain expertise in networking. “As networking is the backbone of automation projects, networking solution providers will be the natural choice. Moreover, we would like partners to establish solutions display area of 200-250 square feet,” he added.

The company, which has two experience zones (PoC zones) of more than 3,000 square feet in Gurgaon and Chandigarh, plans to introduce four more in Udaipur, Jaipur, Pune and Bengaluru in 2014.