Made in UAE: Dubai firm lights up its expansion

LED World, a lighting and electrical design company based in the emirate, has set its sights on expanding its exports further afield abroad. With this in mind, the firm is investing in new facilities including a dedicated production line.

Althaf Ali, the chief executive at LED World. Satish Kumar / The National

The LED lighting shining down in some of Dubai’s malls and palaces could soon be featured in projects in Africa and Asia as LED World, a Dubai-based LED (light-emitting diode) lighting and electrical design company, looks to export its products across the globe.

LED World, which distributes more than 40 products, is rolling out ambitious plans as it invests Dh15 million in a warehousing and manufacturing facility in Dubai Investment Park, which is scheduled to be ready in six months’ time, according to its chief executive Althaf Ali.

It is aiming source at least 40 per cent of its exports from locally-made products once the facility, which will have an assembling unit, raw material storage and full production lines, is up and running.

The company, which is targeting an annual turnover of Dh100m by the second quarter of next year, wants to export a minimum of Dh50m worth of products.

"We are exporting to many GCC countries in the last three years and it is growing," Mr Ali, 33, tells The National. "That's the reason why we are investing in our new factory."

The company, which is currently involved in the Qatar Duty Free project and the new Bahrain International Airport expansion, expects its African business to pick up this year after appointing distributors in several sub-Saharan countries.

LED World started off in 2008 with a Dh2m investment and turned a profit in its very first month.

Its turnover rocketed from Dh4m in 2010 to Dh40m in 2015, the year it decided to not just sell LED lights but also offer services such as design and electrical services.

That has helped its turnover to touch Dh67m in its last financial year that started in April and ends this month.

“This year we are not looking for a large jump in our turnover because we are investing in our infrastructure, facilities and all the basics of our company turnaround.

“We want to operate in multiple folds so we are taking a back seat,” says Mr Ali.

Globally, and in the Middle East, the LED business is booming.

According to the consultancy Frost & Sullivan, the global LED lighting industry will more than double to US$102 billion in 2023 from $47bn in 2016, thanks to declining prices of LED packages, lamps and other forms of illumination.

“Also there is a strong push towards energy efficient lighting which can be relatively easy to achieve through LED lighting,” said Niju V, a director at Frost & Sullivan.

“Regulations in many countries have helped accelerate the pace of LED adoption and hence higher growth.”

In the Arabian Gulf, the sector will also more than double to $2bn by 2020 from $900 million in 2015, buoyed by regulatory support through ban on conventional lamps like incandescent light.

“The push for energy efficiency programs due to international environment obligations, (and) new construction activities are driving growth,” said Mr Niju. “Events like Expo 2020 and Qatar World Cup are the highlights for investments into modern buildings.”

LED World started producing LED lights locally in 2011 from a small assembly line and since then it has fitted out projects that include Dubai International Airport’s concourse D and Terminal 3, the palaces of the Al Makhtoum and Al Nahyan Royal Families, Mediclinic facilities, Emaar malls and government institutions, according to Mr Ali.

The company currently manufactures panel lights, decorative lights such as chandeliers for customised large projects, and supermarket lighting, among other products.

An improvement in technology, which used to be imported from Europe and the Far East, in this country has helped the company to carve out a local industry.

Prior to starting local production, the company imported LED drivers – electrical devices which regulate the power to an LED – from Europe, LED lights themselves from Japan or United States and the aluminium required for housings from the Far East or Europe.

The company today manufactures its own aluminium parts in which the led lights and other parts are encased. Besides producing the aluminium units, the company also carries out electro-plating and other treatments.

The aluminium is sourced from a number of local suppliers who work with Emirates Global Aluminium, one of the world’s largest producers of the metal, which is based in the UAE.

“It [local manufacturing] gives us a lot of upper-hand over competition because this product, our peers, our competitors, normally have to import from the East or West, whereas we keep all these raw materials in stock,” says Mr Ali.

“Our turnaround is much faster. The other advantage is customisation” for individual clients.

He adds that producing locally is more economically viable for certain products, which have to be ordered in bulk, an option that is not suitable for small projects that require specific designs.

About 40 per cent of the products used in LED World projects and 10 per cent of products sold are manufactured or assembled in the UAE, but these figures are expected to increase once the construction of the new factory is finished.

“We will have more product manufacturing to sell over the shelf and we want to export from here to the rest of the country,” says Mr Ali, who has a computer science degree from India.

Dubai is an ideal location for the manufacturing facility because of its location, ease of doing business, qualified labour and good tariff regime, that enjoys preferential treatment for locally made products in some jurisdictions, he says.

“We get super-good prices to bring raw materials here,” says Mr Ali. “The UAE is a neutral country and has good import policies.”

And LED World’s international expansion will surely shine further light on that.

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