Hettich India, the 12-year-old equal-stake joint venture between Saroj K Poddar’s Adventz Group and Germany’s Hettich Group, will invest Rs 500 crore in India over the next five years as it bets on the booming furniture market in the country.
The investment includes a facility to make wire baskets at Vadodara, Gujarat, which would be inaugurated today.
“The unit in Vadodara is our first manufacturing project with an investment of Rs 100 crore.
There are 10,000 products in the Hettich line and we have started producing one,” S K Poddar (pictured), chairman, Hettich India, said.
The company would spend another Rs 400 crore for expanding the operations and plant, which would also serve as a export hub.
Hettich is one of the world’s largest manufacturers of furniture fittings, with a turnover of over $1.2 billion and presence in 110 countries.
“Over the next five years we are hopeful of adding four to five product lines at our Vadodara facility,” Poddar said, adding the joint venture has grown at compounded annual growth rate of 41% over the years.
The Indian unit is Hettich’s second biggest subsidiary outside of Germany.
Andreas Hettich, global CEO of Hettich, said, “India is a growing market and per capita consumption of furniture in the country is expected to increase in line with the western world. We see a very bright future here and are investing substantially to develop the market. Besides, India has the potential to become a very efficient base for servicing our nearby growing markets in South Asia and Middle East.”
The domestic modular furniture market is estimated to be Rs 4,000-5,000 crore, growing at 15-20% annually. The size of furniture fittings industry is pegged at Rs 3,500 crore, growing at 15% annually.
Zuari to sell Mangalore Chemicals stake
Saroj K Poddar also spoke about plans of other group companies.
On Vijay Mallya’s plans to buy Zuari Fertilizers’s stake in MCFL
I don’t have the answer today as I bought the shares in consultation with Vijay Mallya. After some discussions with him, I cannot say that we had any agreement and I agree with him on that front. We have been old friends and will continue to be. The fact is we had some understanding to work together and he is well within his right to chase that understanding. Whatever he decides, we will move according to that. I have the first right on his shares, he doesn’t have the first right on my shares. If he does not wish to divest or enter into a joint venture then the only alternative for us is to divest and we will do that to the highest bidder as I have to look after the interest of my shareholders. So whoever gives me the best price I’m obliged to sell.
Zuari Fertilizers’s investments in new projects
Zuari Fertilizers will be investing of Rs 5,000 crore in a new project in Ras El Khaimah, UAE. This will be to manufacture phosphates.
On expansion and new partnerships in the rail sector
We are looking at some strategic joint ventures, especially on the technology front with global multinational companies especially in the rail sector — locomotives, metro coaches, coaches, specialised accessories, etc.
Being one of the largest private sector companies (Texmaco) for the rail sector in India, we will be looking at the entire gamut of railway products. Today 25% of all Indian wagons are made by Texmaco.
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