At a time when soda ash business is growing at a sluggish pace, chemicals major GHCL Limited plans to increase its revenues from non-chemical business, i.e. home textiles. The company is exploring new overseas markets including South America and China for increasing the reach of its home textile products.
The company has chalked out plans to increase revenue share of home textiles business from the current 35-40 per cent to around 50 per cent of the total turnover in the next financial year 2013-14.
“Order pipeline is healthy for our home textiles business. The US is a major market for us. Of the total home textiles revenues, about 70 per cent comes from overseas markets. We expect this trend to continue and we are also exploring new markets including South America and China,” said R S Jalan, managing director, GHCL Ltd.
“This year we expect home textiles business to contribute around 40 per cent to the total turnover of the company, but we expect it to increase to around 50 per cent in the next fiscal,” he said.
According to Jalan, company's home textiles business has registered growth of 25 per cent over the past couple of years, while the soda ash business continues to grow at a sluggish growth of around 2-5 per cent annually.
For the financial year ended March 2012, company’s total income stood at Rs 1,896 crore. Company’s chemicals segment generated revenues worth Rs 1,148 crore for the year, while home textiles segment registered revenues worth Rs 748.5 crore.
In its recently announced quarterly financial results, GHCL informed that its home textiles segment reported revenues worth Rs 199.5 crore for the quarter ended December 2012, while chemicals segment reported revenues worth Rs 288.6 crore. GHCL reported total income of Rs 488 crore for the quarter ended December 2012.
“Growth in soda ash business is mainly impacted by downside in demand. However, we are globally competitive in the soda ash pricing,” stated Jalan.
It may also be noted that company has already tied up with Future Group for supplying home textiles products. The company is also exploring supply tie-up with other big retailers like Bharti Walmart and IKEA, among others.