I have covered Cera Sanitaryware in a detailed research note earlier. In this article I will share an interview with Vikram Somany, Managing Director of Cera Sanitaryware.
Vikram Somany interview – Cera Sanitaryware
Key points that were interesting were as follows:
- The shift from unorganized to organized players in the sanitary ware market in India continues. When Cera started sanitary ware operations, around 20% of the market belonged to organized players, with dominant positions occupied by Hindustan Sanitaryware (HSIL) and Parryware (owned by EID Parry earlier, later sold to Roca). Today organized players have increased their share of the sanitary ware market and reached 50%.
- I had also come across this point in my channel checks. It was good to see this getting validated by management commentary.
- Gradually, there is increased outsourcing by larger players. Smaller, local players are entering into contract manufacturing agreements. Bigger players are taking stakes or forming JVs and engaging manufacturing facilities of smaller players.
- After the demise of Vidush Somany, Vikram Somany’s son, people had started questioning succession plans at Cera Sanitaryware. The company has brought back Mr. Kothari as CEO in September 2012. He had retired earlier.
- They will continue to opportunistically launch faucets and bathroom related items under the Cera brand. As I have already mentioned this is good for the company as they are sweating the brand expenditure better by selling more products.
(ht – Ayush Mittal, Ayush is one of the founders of Screener.in).