Orient Bell to set up more tile factories
Orient Bell, the NSE-listed tile manufacturer, is investing more than Rs 40 crore in setting up two joint venture factories and increasing production capacity at one of its own plants next year.
The New Delhi-based floor and wall tile major is targetting 15-20 per cent growth in topline in 2017-18 after a flat growth this year. It had clocked Rs 750 crore in sales turnover in fiscal 2016, a growth of 5 per cent over the previous year.
“After almost a flat growth this financial year with the fuel prices going down and therefore, selling tiles at lower rates, we are targeting 15-20 per cent growth in sales turnover in fiscal 2018,” KM Pai, executive director and CFO at Orient Bell told Financial Chronicle.
He said demand for its products would come predominantly from commercial and residential real estate sector and large-scale infrastructure projects across the country.
Pai said the two joint venture factories with a total investment of Rs 120 crore would come up in Gujarat in financial year 2018 and produce 6 million square metres of tiles.
“These two joint venture factories will go onstream in 2018. We will be holding 25 per cent equity stake and invest accordingly in both the factories but 100 per cent marketing and sales will be carried out by our company,” he said. He said the company had earmarked over Rs 40 crore capital expenditure for financial year 2018. The company has three factories in Uttar Pradesh, Karnataka and Gujarat.
“We are also expanding production capacity at our facility in Uttar Pradesh, where ceramic tiles production will be replaced with vitrified tiles,” Pai pointed out. He said the production capacity would be doubled from 2 million square metres tiles to 4 million square metres to meet the growing demand for vitrified tiles in the country.
Apart from offering wood, stone and marble finish tiles, the company boasts of four patented brands like Forever Tiles, Cool Tiles, Life Tiles and Germ Free Tiles.
Orient Bell, which opened its 10th company owned and company operated boutique store in Pune last week-end, plans to add four more new stores to the tally in fiscal 2018. “These four new display and experience boutique stores will come up in Mumbai, Gurgaon, Hyderabad and Bangalore with 2,500-3,000 sq ft size,” Pai said.
Pai said the tile market in India was pegged at roughly Rs 20,000 crore annually with a CAGR of 12 per cent over the last 15 years.
After a flat growth in fiscal 2017, the industry would be back to 10-13 per cent growth in financial year 2018, he said.

Michael Gonsalves