Panasonic Carbon India is the only company in India that makes carbon rods - the slender conductive electrode at the centre of every zinc-carbon dry cell battery, from the ones in TV remotes to those in portable radios. Incorporated in 1982 as a subsidiary of Japan’s Panasonic Holdings Corporation, which still owns 63.27%, it was set up to replace imports with local production and has since grown into a significant exporter, shipping to Panasonic battery factories across Asia, Europe, and the Americas while competing head-to-head with Chinese and Indonesian manufacturers. The company’s entire approach rests on a single, recurring idea: relentlessly drive down cost through in-house material science and self-built machinery, then compete on price, quality, and delivery reliability everywhere at once. # Business segments A single-engine business - carbon rods for zinc-carbon batteries, sold to battery makers in India and overseas - where the same factory, the same R&D, and the same customer relationships serve both domestic and export markets. ## 1. Carbon rods: the electrode at the heart of every zinc-carbon battery **The company makes one product - carbon rods - and sells it to battery manufacturers worldwide, earning roughly two-thirds of its revenue from exports and the rest from Indian customers, all from a single factory in Andhra Pradesh.** - **The sole Indian manufacturer** - it is the only company in the country producing carbon rods for zinc-carbon batteries, which means Indian battery makers who want a local supplier have no alternative, and the product itself acts as an import substitute against Chinese and Indonesian competition. - **Sold by the piece, not by weight** - revenue comes from one-time B2B sales of physical goods, recognised when control passes to the customer on shipment or delivery, with 2,237 million pieces sold in FY26 split almost evenly between domestic buyers (1,140 million pieces) and export buyers (1,097 million pieces). - **The Panasonic family is its biggest customer** - export sales go predominantly to Panasonic Group battery factories in Peru, Thailand, Indonesia, Brazil, Costa Rica, and China, along with a significant flow through Panasonic Trading and Logistics Asia Pacific in Singapore, a fellow subsidiary. - **In-house machines, in-house know-how** - it designs and fabricates its own special-purpose manufacturing equipment rather than buying it from outside, which gives it customised production capability and keeps it from depending on external machinery suppliers. - **Debt-free and self-funded** - the company carries no long-term or working-capital borrowings, parks surplus cash in bank fixed deposits, and turns over its debtors in about 30 days and its inventory in roughly 24 days, so it funds its own operations without outside pressure. ## 2. R&D as the cost engine: substituting materials to stay cheaper than rivals **Every year, the R&D team works on one problem - how to make the same carbon rod with cheaper or more readily available raw materials - and that is how the company protects its margins without raising prices.** - **Swapping out expensive inputs** - it has replaced amorphous graphite with baked pet coke to cut imports from China, substituted natural graphite for artificial graphite in some sizes, and removed carbon black entirely from certain grades, all to reduce the raw-material bill. - **Artificial over natural, when it helps** - in a counter-intuitive move, it has increased the use of artificial materials to reduce reliance on scarce natural resources, developing cost-effective compositions that offset raw-material price spikes. - **Process tweaks that compound** - it cut mixing time with high-speed mixers, boosted ball-mill output by increasing screw and separator speeds, introduced liquid coal tar pitch, and switched to diamond-coated nano dies for R03-grade rods to lift production yield. - **No imported technology needed** - the company has not imported any technology in the last five years; it relies on regular know-how upgrades and its own engineering team to develop new grades like the XN carbon rod for vaporisers and seven varieties of semi-finished gouging carbon rods. ## 3. The export engine: a Panasonic supply chain with third-party reach **Two-thirds of revenue comes from outside India, mostly from fellow Panasonic companies, which gives the business a built-in demand base while it also competes for non-Panasonic customers in markets like Slovenia and South Africa.** - **A captive-but-not-captive customer base** - the top four customers each account for more than 10% of total revenue, and the largest export buyers are Panasonic battery factories, so the company has a stable order book from within its own corporate group while still selling to unrelated battery makers. - **Import substitution earns foreign exchange twice** - by making carbon rods in India, the company both earns foreign exchange from exports (₹27.73 crores in FY24) and saves foreign exchange that Indian battery makers would otherwise spend on imports (an estimated ₹22.71 crores in the same year). - **The export share has shifted over time** - export volume was 62% of total sales in FY20 but dropped to 49% in FY26 as domestic offtake grew from 959 million pieces to 1,140 million pieces, showing the company can flex between markets as demand moves. # Group structure and partners **Panasonic Carbon India is a listed subsidiary of a Japanese giant, with no subsidiaries of its own - it is a single-entity manufacturer plugged into a global group supply chain.** - Panasonic Holdings Corporation, Japan, holds 63.27% of the equity and nominates the Managing Director to the board, while the company’s shares trade on the BSE with close to 11,000 shareholders. - It pays a brand licence fee and royalty to the Japanese parent, buys goods through Panasonic Procurement Asia Pacific, and sells to at least eight Panasonic battery factories across Asia, Europe, and the Americas - so its commercial relationships are deeply interwoven with the group. - The company has no subsidiaries, joint ventures, or associates, and its entire manufacturing footprint is a single plant in Nellore District, Andhra Pradesh, with a registered office in Chennai.