After premium sanitaryware, HSIL shifts focus to consumer products

Plans 13-fold rise in annual turnover from latter, to Rs 2,000 cr, in next 5 years

After enjoying top position in premium sanitaryware, the Hindustan Sanitaryware and Industry (HSIL) now wants its consumer products vertical to lead its business, after having enjoyed top position in premium sanitaryware.

The said vertical covers air coolers, air purifiers, water purifiers, built-in ovens, sinks, water heaters and air vents, among others. The company has earmarked a sizeable amount as investment in consumer products in 2017-18, on manufacturing, product development and network expansion.

This, it states, is due to limited growth opportunities in premium sanitaryware. HSIL says the overall annual growth rate in the sanitaryware industry is 10-12 per cent. However, consumer products enjoy growth of 30-35 per cent annually, due to high penetration of new technology, mainly in urban areas.

"Just after our foray into the consumer segment, we have witnessed tremendous response for our products. Our (annual) turnover of the segment has increased from Rs 20 crore to about Rs 150 crore in two years. We want to be in the top three players in next five years. For that, we are going to invest on product development, manufacturing facilities and network expansion," said Rakesh Kaul, president and chief executive of their consumer business.

From a current seven per cent share in its annual turnover of Rs 2,000 crore, HSIL aims to grow consumer products to 25 per cent of the total in the next five to seven years.  "Currently consumer business is a smaller percentage of the overall HSIL business, but the way this business is growing at a significant pace, we intend to be a sizeable part of the overall HSIL business in due course of time," said Kaul.

"Our first water heater assembling unit will be soon operational," he added. "HSIL is soon going to start with local SKD assembly unit in the category of water heaters and for this our strategic partner Groupe Atlantic which is France based multinational will work closely with us. Kaul adds that HSIL is talking with more global operators in the vertical for developing and producing quality products. He wouldn't give details.

The dealership network will expand from the current 4,000 to 20,000 by end-2020. And, Rs 50 crore is meant for aggressive branding and marketing of consumer products.