Companies

Titan act to revive Tata Ceramics’ fragile fortunes

Priyanka Pani Vinay Kamath Mumbai/Chennai Oct. 5 | Updated on October 05, 2013

Tata Ceramics' Rebecca Chintz Tea Set

CRAFTING TRANSFORMATION

Crafting tableware for Rashtrapati Bhavan isn’t the only claim to fame for this Tata group company.

Tata Ceramics Ltd (TCL) also makes bone china tableware for some of the best brands in the world such as Wedgewood, Royal Doulton and Churchill.

You can also find Tata Ceramics in almost all the top hotels in India and Indian embassies abroad.

However, the little-known TCL, incorporated in 1991 as an associate company of Tata Power, is an ailing unit now. Tata group’s Titan Co Ltd Managing Director Bhaskar Bhat has been appointed Chairman of TCL and entrusted with the task of injecting some vigour to its marketing to revive it.

Shift in focus

Located in the Kochi SEZ, the company has close to 400 employees and exports most of what it makes.

But with Bhat taking over, the focus will shift to the domestic market. Titan’s former chief of retail services V. Govind Raj has taken over as Managing Director of the company.

“We have been in charge at Tata Ceramics the past six months. Earlier, TCL used to be in institutional sales but now there will be a change. It is a great product hidden away in Kerala,” says Bhat.

As on March 31, 2013, the company’s turnover was Rs 50 crore and it had accumulated losses of Rs 14.09 crore.

Though TCL makes tableware for top brands, it was unable to scale up. Its large plant of 10 million pieces a year saw only half of it utilised, leading to losses. Nearly 90 per cent of the turnover used to come from European markets, Australia and New Zealand. But that is declining given the general downturn in those markets.

However, as Bhat says, “The company is now inching towards break-even and it may not be long before it is able to start having a good spell of profitability as it’s in a niche lifestyle market.”

Bhat, who oversaw Titan’s diversification from a watch maker to a jewellery and eyewear retailer, plans to effect a similar transformation in TCL.

EXPLORING POTENTIAL

“We are currently testing the market and exploring its potential. TCL’s competence is in manufacturing, so we want to take it a step ahead. Also, tableware in India is largely unorganised. We need to grow the market and make it organised. Many Indian middle-class households are now moving from steel tumblers to crockery,” he explains.

Bhat says the category shows great potential for a good-size lifestyle retail play.

“It would be necessary to establish a good business model for retail and we are working on that. Once established it should be easy for us to scale up in a very short time. Titan will be working at an arm’s length with Tata Ceramics in the venture,” he explains.

Titan’s distribution strength will be leveraged to the hilt. Soon, Bhat expects domestic sales to equal export sales.

“Exports too are a growing area and the company will continue its thrust while establishing its presence in the domestic markets,” he adds.

> priyanka.pani@thehindu.co.in

Published on October 05, 2013

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