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Sanitaryware products maker HSIL Limited is entering the consumer products segment to diversify its business into other product categories.
It plans to leverage the “strategic” marketing tie-up with French-based thermal comfort solution provider Groupe Atlantic, to bring the latter’s consumer products portfolio to the country.
“In the future, we are looking at covering solar systems, air heaters, room heaters and other non-water related segments,” said Sandip Somany, joint managing director of HSIL Ltd here today.
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Through a co-branded marketing agreement HSIL and Groupe Atlantic, had started rolling out a compact water heater range in the country this year. HSIL, through its 18,000-strong retail network, plans to reach out to 21 cities pan-India for the product initially.
According to Somany, the consumer products foray is a strategic move in the backdrop of general slowdown in the Indian real estate sector. “Of course, we also have to look at new opportunities because the growth in the main sector (real estate) has been subdued, and it is not that positive as we would like it to be,” said Somany.
Somany said the newly-launched patented water heater range had been exclusively designed for Indian conditions and the company expects to market at least 300,000 units in the next three years. Currently, HSIL is procuring these products fully-manufactured at Groupe Atlantic’s plants in Europe, Thailand and Egypt.
HSIL expects the segment to contribute Rs 200-250 crore to its total revenue by the end of the third year. The company had clocked a turnover of Rs 2,000 crore in the last fiscal.
The company also has plans to set up a joint manufacturing unit locally with Groupe Atlantic to serve the category if the volumes justify the investment.
The market size of water heater and geyser segment in India currently stands at Rs 1,500 crore, and is expanding at 15-20 per cent each year, HSIL said in a presentation.
