Somany Ceramics is an internationally acclaimed organization that specializes in ceramics and allied products segment. In the last four decades, the brand has established itself as an unchallenged leader in the Indian Ceramic Industry with a significant presence in India, Africa, The Middle East, UK, and Russia.
In conversation with Abhishek Somany
Somany Ceramics has strengthened its presence in Gujarat by opening a state-of-the-art experience center. How is the feedback of consumers?
Strategically located at the Arista Business Space on Bhavan road, the experience center holds the promise of offering consumers a plethora of high-end products. The center is a one-stop-shop for complete ceramic walls and floor tiles, polished vitrified tiles, glazed vitrified tiles, digital tiles, sanitary ware, and bath fittings, and houses a team of highly trained staff for better client servicing. To date the consumer response has been excellent with increasing footfall every week and is being looked at as the ultimate décor destination in Ahmedabad.
You have currently eight manufacturing plants of tiles and sanitaryware production, out of which seven are in Gujarat, Kadi, and Rajkot. Which will be your next targeted city?
For the upcoming financial year, we are planning to set-up our bath fittings plant in Bhiwadi. We have already initiated the process and look forward to start manufacturing by the end of 2017. Beyond this, it’s too early to talk about which city we will be targeting for another plant.
How do you see the sanitaryware market growing in India? What are the measures taken by the company to expand this division?
The Indian sanitaryware market is growing with a CAGR of 12% to 15% from last four years and is projected to have a steady growth by the year 2021 due to increasing disposable incomes, rapid urbanization, and changing end-user preferences. We have trebled the sanitary ware manufacturing capacity at our Morbi plant in Gujarat from 3.03 lakh units to 11.50 units per annum. Prior to this manufacturing capacity expansion, we could not meet the demand for our sanitary ware products in the market and hence we decided to aggressively expand our production capacity in this short duration. We have also strengthened our distributor network to reach consumers across the country.
How do you see the ceramic tile and sanitaryware industry growing in the future?
In 2016, our company saw a rise in demand for tiles by 8-10% and 30% for sanitary ware. As stated earlier, the Indian sanitaryware market is growing with a CAGR of 12% to 15% from the last four years providing a great impetus to manufacturers. India is the third-largest tiles market in the world. While the global tiles production grew at an annualized rate of 6.3% for the period 2006- 2013, tiles production in India grew almost double at 12% during the same period.
Tell us about your export volumes? What do you think the government has done to promote ease of business for the tile industry? Has it impacted exports?
In the last financial year, our export volume accounted for 5% of the overall revenue. This year we are looking to expand our business and increase our export volume by 25%. Implementation of Government policies remains the single largest catalyst to boost sentiment and demand across categories of buyers. The correction in gas prices and imposing Anti-dumping duty on Chinese vitrified tiles have increased the competitive edge for tiles manufacturers especially for the organized sector in India. The Introduction of policies like RERA (Real Estate Regulation and Development Act 2016) and the Benami Transactions Act by the Govt. of India will also help in boosting the industry. The organized players will lead the change and benefit the most over the next two years. Government’s focus on increased spending on infrastructure would spur huge demand. Birth of satellite towns along new highways will further accelerate demand. We are expecting GST of our industry to fall under the 18% tax slab, however GST for sanitary ware has been introduced at 28%.In the long run, the organized sector of the sanitaryware and ceramic industry, which accounts for 50-55% of the total, would definitely benefit from the implementation of GST. This can be attributed to stricter laws and transparent policies which will give the organized players an advantage over unorganized players.
What are your plans for the future?
With over four and a half decades of spearheading industry innovation, Somany Ceramics Limited is one of the leading players in the Indian ceramic industry with the wide product selection categories. The brand has constantly pushed boundaries with an ever-evolving, innovative portfolio of products including Floor & Wall Tiles, Ceramic, Porcelain &Vitrified Tiles as well as Sanitary ware& Bath Fittings. We as a brand are constantly exploring opportunities to meet changing consumer needs and offer innovative products. We effectively developed an extensive marketing and distribution network, which comprises over 15000 plus touchpoints across the country. Apart from a strong national presence, globally we are present in 70 countries.
(This interview was originally published in The Tiles of India July-Aug 2017 issue)