The Hindu Business Line : Nitco Tiles plans making sanitary, chrome plated bathroom fittings

Nitco Tiles Ltd is to soon venture into manufacturing of sanitary and chrome plated (CP) bathroom fittings, according to its Vice-President, Sales and Marketing, Mr Parvez Amin.

The company was in advanced stages of negotiation with two-three companies for setting up a joint venture in six months, Mr Amin told Business Line adding that a leading international brand was keen on tie-up to have its production base in India.

The international firm was currently selling its products, sanitary and CP fittings, in India through a sales and distribution network. Nitco might take over the distribution network initially to start manufacturing at a later stage, he added.

“We plan to take a controlling stake in the proposed joint venture and are currently negotiating with the prospective partner on sharing brand identity,” Mr Amin said.

Turnover

The joint venture would ideally look at achieving a turnover of Rs 100 crore in the first year of operation and would scale it up to Rs 500 crore-600 crore in three-four years, he said, adding that the initial investment by all stakeholders was likely to be in the range of Rs 100 crore-150 crore.

However, if the proposed joint venture did not proceed as planned, Nitco would be open to other options such as setting up its own manufacturing unit or acquiring an Indian company active in the field, he said. The sanitary and CP fittings segment has a market size of nearly Rs 2,000 crore in India, he estimated.

The proposed manufacturing units would be located close to their respective raw material sources, Mr Amin said. The CP unit was likely to come up near Delhi for availability of brass and the sanitary fitting factory might be set up in Gujarat for clay and gas reserves.

Mr Vivek Talwar, Managing Director, Nitco Tiles, said the company would add 350 retail outlets named Le Studio in three years through franchise to the existing 50 opened last year.

According to Mr Amin, the company’s accounts for 2008-09 were yet to be finalised but he expected a growth of nearly 11 per cent over last year’s turnover of over Rs 580 crore.

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