Companies

Somany to pick up stake in two Morbi-based cos

PTI Ahmedabad | Updated on August 02, 2013 Published on August 02, 2013

Abhishek Somany

Tile maker Somany Ceramics today said it would pick up stakes in two Morbi-based companies, to acquire a total production capacity of 41 million square metres (million sqm) per annum from its existing 36.5 million sqm capacity, by the end of current fiscal.

“We have the board’s permission to pick up 26 per cent and 51 per cent stake in two Morbi based companies Vicon and Amora, respectively. We plan to acquire them for Rs 15 crore,” Somany Ceramics Joint MD, Abhishek Somany said.

“With the acquisition of these two companies, we will acquire a total tiles production capacity of 41 million square metres per annum. The two new plants — Vicon (3.9 million sqm) and Amora (2.4 million sqm) — are expected to be commissioned between third and fourth quarter of the fiscal,” Somany said.

The company has three manufacturing units of its own in Gujarat, out of which one is at Kadi and two are in Morbi, besides ten other units to which it outsources production.

The company had a turnover of Rs 1,110 crore last year, of which Rs 700 crore came from Gujarat.

In the wake of the real estate sector slowdown, as well as increased costs of fuel and power, the company aims to grow at around 20 per cent CAGR this year.

“We have been growing at a CAGR of 24 per cent, but due to tough market conditions this year, we aim to grow at around 20 per cent,” Somany said.

The company plans to expand its product portfolio, by launching bigger sized tiles under its patented brand ‘VC Shield’

Amongst large tile players, the company has a manufacturing capacity of 36.45 million square metres of tiles per annum spread across two of its own manufacturing plants in Haryana and Gujarat (19.15 million sqm), two joint venture plants in Gujarat (5.30 million sqm) and outsourcing tie-ups for 12.0 millions sqm.

Published on August 02, 2013
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