to 37%, catalysing home building (and hence
tile offtake). Besides, India is getting younger,
wealthier, aspirational and aesthetic. The
number of census-covered towns increased
3x between 2001 and 2011, a trend expected
to sustain in line with growth in the country’s
road infrastructure.
Sectoral trend:
An industry churn towards
organised manufacture will catalyse the
growth of the country’s sector. In October
2013, the Gujarat High Court directed
unorganised Morbi tile manufacturers to
stop using coal due to pollution concerns,
reducing their cost advantage.
The sanitaryware and faucet segment
Kajaria initiated the manufacture of
sanitaryware in Morbi with the objective
to complement its trading model – a
differentiated approach from the existing
practice of tile companies selecting to
outsource sanitaryware. The Company is also
setting up a faucet plant in Rajasthan.
This response has been inspired by two
reasons: Tiles, sanitaryware and faucets
are marketed by a majority of the tile retail
outlets, so the decision to manufacture
sanitaryware will help address a larger share
of the dealer’s business and customer’s
wallet. Over the last number of years, the
Company seeded sanitaryware demand
through prudent outsourcing (imports)
for which it is now creating a captive
manufacturing back-end.
Besides, India’s sanitaryware and faucet
demand is addressed by few brands (Indian
and global). A growing emphasis on
pan-India sanitation projects will only widen
the market and help Kajaria capture a large
market share.
Message to shareholders
At Kajaria, the outlook is exciting as we
widen our multi-locational footprint, increase
capacities, strengthen the supply chain,
enhance value-addition, enter a new vertical
and make fresh investments. We expect that
these initiatives will translate into sustained
sectoral outperformance that translates
into enhanced shareholder value across the
foreseeable future.
Warm regards
The management team
Kajaria’s revenue
milestones
First
`
10 billion…
March 2011
23 years
…next
`
10 billion…
March 2014
3 years
…and the next
`
10 billion!
March 2016 (E)
2 years
Mr. Rishi Kajaria,
Joint Managing Director
Kajaria initiated
the manufacture
of sanitaryware
in Morbi with
the objective to
complement its
trading model –
a differentiated
approach from the
existing practice
of tile companies
selecting to
outsource
sanitaryware.
13
Annual Report 2013-14
