Ellora Time's Manufacturing Woes

In 2001, Ellora Time Pvt. Ltd. (Ellora), a company based in Gujarat, India, was the world's largest manufacturer of clocks. It also manufactured calculators, telephones, timepieces and educational toys. Ajanta and Orpat were closely held Ellora companies with a combined investment of Rs 2 billion.

Ajanta Quartz (Ajanta) ran the clocks business, while Orpat Electronics (Orpat) handled the other businesses. The business was fully financed by the promoters, the Patels, without loans from banks or financial institutions. The companies, situated in a place called Morbi (near Rajkot in Gujarat), exported their products to over 60 countries.

In early 2001, Ellora shocked the corporate world by announcing its decision to shift its manufacturing activities to China. Commenting on the decision, Ellora sources said that the decision was more out of compulsion than choice. The company claimed that it was unable to cope with imports from China that competed directly with its products. As these goods were much cheaper than Ellora's products, the company was facing serious problems that seemed to threaten its very survival.

Ellora's decision attracted immense media attention because it came at a time when the Indian manufacturing industry was facing severe competition from cheap Chinese imports.