Kajaria continues to grow

In the spotlight
Kajaria
continues to grow

Ashok Kajaria
Tile International 3/2015
With the aim of reaching an output of 100
million sq.m/year by
March 2018, the largest Indian ceramic tile manufacturer Kajaria is following
apace its planned investment programme which
started a couple of years
ago.
The group ended the year
2014 with a production capacity of 54 million sq.m
and a real production of
52
50 million sq.m (10 million
more than the previous
year, +26%), but both figures
have
already
changed in the first 9
months of 2015 following
the start-up of new production sites in Rajasthan and
Gujarat.
Even more astonishing was
the 37% increase in turnover registered in 2014,
which reached approximately 327 million euros.
We met Mr. Ashok Kajaria,
who updated us on the latest operations and described the future steps in
his agenda.
Tile International: - Kajaria
achieved excellent growth
last year. What can you tell
us about this? Ashok Kajaria: “That’s
true, we have posted a
healthy uptick in both revenue (+19%) and profitabili-
In the spotlight
ty (+41%). We are looking forward to good opportunities
over the next five years as the
government has launched a
comprehensive social housing project called “Housing for
all by 2022”. An estimated 60
million houses will need to be
built to achieve this goal. The
government
has
also
launched “Swatch Bharat Abhiyan” (Clean India initiative),
which aims to build 60 million
toilets across the country by
2019.”
Tile International: - In just a
year you have increased the
number of your tile plants from
7 to 10. What’s next in your expansion programme? A. Kajaria: “A new floor tile line
with a capacity of 3 million
sq.m/year will begin production at the existing location in
Gailpur in September/October this year. Our JV partner
Taurus Tiles Private Limited
commissioned a 5 million
square metre polished vitrified
tile facility in Morbi in June
2015. We will also start up a 6.5
million square metre polished
vitrified tile greenfield facility in
Rajasthan by December 2015.
With this expansion we will
reach a tile capacity of
around 69 million sq.m/year
by the end of this calendar
year, registering growth of 28%
53
over 2014.
We have also entered into a
new JV with Floera Ceramics
Pvt Ltd involving the construction of a 5.7 million square metre polished vitrified tile facility
in Andhra Pradesh, which will
come on stream in 2016.”
Tile International: - What
technologies do you use? A. Kajaria: There is nothing
new as far as technology is
concerned, but a few new
Tile International 3/2015
In the spotlight
machines have been installed
to make bigger tiles including
a 6500 PH press and a 273 metre kiln from Sacmi, one of the
longest in India.
We are also the first in India
and the second in the world
to have adopted the new Divario press feeding system
from LB.
Tile International: - Besides
producing bigger volumes, to
Tile International 3/2015
what extent are you improving
the quality of your products? A. Kajaria: “Exposure to international home buying trends
and the impact of surging
markets has changed the
face of the modern urban
landscape.
Now the affluent, cosmopolitan and discerning consumer
demands premium products
and services and has ample
knowledge of the choices
available.
This is the reality of the modern Indian tile market. To cater
to the expectations of the discerning buyer, it’s important
for us to keep a tab on the
quality of our new ranges and
large format sizes such as
80x120 cm, 60x120 cm and
80x80 cm in glazed porcelain
and polished porcelain for
54
niche customers, along with
volume driven sizes like 30x60
cm and 30x45 cm. We are also
planning to launch slim tiles in
a large format very soon.”
Tile International: - How did
the market respond to your recent entry into the sanitaryware and faucet sector? A. Kajaria: “Tiles, sanitaryware
and faucets are complementary products sold in the same
In the spotlight
stores, so this was an opportunity for Kajaria.
Moreover, our dealers mentioned that an increasing
number of customers were
asking for complete bathroom
furnishing solutions. We decided to enter the sanitaryware
and faucet verticals through
our subsidiary Kajaria Bathware Pvt Ltd.The 700,000 piece
sanitaryware facility at Morbi,
Gujarat will reach the optimum production level in the
current fiscal year. The product range comprises 100
SKUs catering for diverse customer requirements. Similarly,
the 1 million piece faucet facility at Gailpur (Rajasthan)
will also optimize capacity
utilization in the second half
of this fiscal year.”
Tile International: - How do
you expect demand for tiles to
evolve in India? A. Kajaria: “India is ranked
third in world ceramic tile production after China and Brazil
and is growing annually at 1112% as a result of urbanization
and replacement of natural
stone.
A majority of India’s ceramic
producers are located in Morbi (Gujarat), possibly the sec-
55
ond largest tile cluster in the
world accounting for more
than 60% of the country’s total
production.
Although India is one of the
top consumers of tiles globally,
it is also one of the lowest in
terms of per capita consumption. But despite some sluggishness in the real estate sector, I believe that demand for
tiles will continue to grow.
The most important reason for
this is that technological advancements have strengthened the aesthetic appeal of
tiles, making them an integral
home improvement component. And as I said, in this segment tiles are replacing a lot
of low/high end marble. The
replacement market is growing as people aspire to better
products which are now available in India at very affordable prices.
The new Government’s push
for housing, sanitation and
building smart cities along
with growing urbanization
and easy availability of housing finance are some of the
other developments that will
impact demand positively.”
Tile International: - With such
a high local demand to satisfy,
is there space to focus on export markets? A. Kajaria: “We do export ceramic tiles to the Gulf countries and have begun exporting glazed porcelain tiles to
Europe, Australia, Taiwan and
the USA, but it is still very low as
a proportion of our domestic
sales.”
5
Tile International 3/2015
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