H&R Johnson to invest Rs. 400 crore in two years



Vijay Aggarwal, Managing Director



Ceramic tile maker, H&R Johnson (India), which has entered the bath fittings and kitchen cabinets segment, plans to invest nearly Rs. 400 crore in the next two years for expanding its various businesses. The Rs. 1,500-crore company hopes to increase its revenue by 25 per cent in the current fiscal.

Vijay Aggarwal, Managing Director, H & R Johnson India, said the ceramic tile market was growing along with the demand for bath fittings and kitchen cabinets. To meet the increasing demand, the company had invested Rs. 225 crore for expanding its ceramic tile manufacturing plant in Andhra Pradesh from 3 million sq.m to 6 million sq.m.. This was being further expanded to 9 million sq.m by January 2012.

Greenfield projects

The company would also be investing in two new plants at Rajkot in Gujarat. It had already invested Rs. 20 crore during the current fiscal in a joint venture to make 2.3 million sq. m of small tiles. The second one, a greenfield plant, would come up by February 2012 to produce one million sq.m of engineered marble and quartz at an investment of Rs. 50 crore. The company also planned to increase the capacity of industrial tiles, Endura, from 1.5 million sq.m to 2.5 million sq.m by March next year. It would be investing Rs. 35 crore for this expansion plan.

The market for tiles is estimated at Rs.14,000 crore. The share of the unorganised sector is around Rs. 8,000 crore and the balance is the contribution of the organised sector. Of the total organised market, Rs. 5,000 crore came from medium-end products and the balance from top-end products. For H&R Johnson, Marbonite and Johnson tiles contribute 45 per cent of its sales and the balance came from Endura.

The company had introduced digital technology for printing new designs on the ceramic tiles. Mr. Aggarwal was of the view that digital technology would catch up in the ceramic tile market in future.

On the bath fittings division, he said the company was planning to double the capacity of Baddi (Himachal Pradesh) plant. It would be doubling the capacity to 50,000 pieces of taps annually. It was also planning to set up a greenfield project in Jammu to manufacture 50,000 pieces of taps by April next. The revenue from this vertical was Rs. 70 crore last year. This would go up to Rs. 100 crore in the current fiscal, he added.

He said the kitchen cabinet division was started two years ago and was providing one-stop solution to customers. At present, the company had 40 dedicated showrooms. This would go up to 70 in the next six months.