Somany looks at stake, forms JVs with small firms

Tags: News
Somany Ceramics will acquire minority stakes in small ceramic manufacturers and form joint ventures with them. These will add up to its capacity as these companies will manufacture for Somany.

These companies are based in Gujarat. “This is part of our asset light strategy that will add up to manufacturing capacity with lower investments,” said Abhishek Somany, its joint managing director.

Over the next few months, it will also upgrade some machinery to meet the demand for value added products, like digital print tiles that mimic marble or the wood. According to him, there is a preference for such products and this is giving an impetus for the ceramic brands to grow better than the industry, he said adding the demand for high-end products is on the rise. The real estate segment’s behaviour is different across the country and hence there is no slack in the demand for ceramic products.

In the last three quarters, the company has reported a 20 per cent growth in its sales to Rs 712.5 crore compared with Rs 595.51 crore during the corresponding period last year. It has manufacturing capacity of about 19.1 million sqm and two joint venture plants account for 5.3 million sqm. It also has outsourcing tie-ups for another 12 million sqm.

krishnamohan@mydigitalfc.com

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