Somany Ceramics set for further expansion

The Indian ceramic group will increase its production capacity by 20% to around 76 million sqm/year. The project should be completed by March 2022

Somany Ceramics, India’s second largest ceramic tile manufacturer and one of the top 15 global players, is carrying on its major investment aimed at capacity expansion, a plan that has gained further momentum following the strong sale performance that the company registered in the six-month period from April to September 2021.

The project is expected to be onstream and effective by the last quarter of the FY 2021-2022, so foreseeably by March 2022.

“This is the largest expansion capacity in our recent history and will bring a net 20% increase od saleable capacity to around 76 million sqm/year compared to the current level of 63 million sqm/year”, said Managing Director Abhishek Somany. “There are some good reasons why the capacity expansion was essential. Firstly, the structural shift in consumer preference from unorganised to organised brands makes it imperative to commission additional capacity rapidly or risk losing market share to competitors who expand faster than us. Additionally, the capacity expansion will be concentrated in large format glazed vitrified tiles & technical porcelain range, allowing us to insource a portion of production that is currently outsourced to third party manufacturers. All of this will have a very positive impact on our margins, so we expect to be able to pay back the investment within a very short timeframe”.

Despite the outage of 1.5 month of covid 19, Somany Ceramics closed a very positive financial year ending March 2021. While revenues saw only marginal growth amid the challenges of the pandemic (+2.7% on 2020), EBITDA jumped by 45% to 11.6% of turnover, debt fell to zero and our cash surplus was the highest ever recorded. The first half of the financial year 2021-2022 also brought very good results. Tile sales to 30 September 2021 were up 45% on the first half of 2021 at 26.2 million sqm, consolidated turnover rose by 50% and EBITDA climbed 141% to 10.3% of revenues.

“The resilience of Indian economy together with the improvement in business sentiment and consumer confidence was reflected in our results despite the unprecedented increases in gas prices, freight rates and other production costs which are continuing to put pressure on our margins”, Mr. Somany said.

Somany Ceramics has its corporate office in Noida (Uttar Pradesh) and has two manufacturing units in Kadi (Gujarat) and Kassar (Haryana) as well as a further seven subsidiary and associate plants and arrangements with other manufacturers.

In more than 50 years of business, the group has developed a complete range of home décor products, including ceramic tiles, polished and glazed vitrified tiles, tile laying solutions and bathroom fittings. In this latter segment it produces both sanitaryware (the factory in Morbi has an annual production capacity of 1.15 million pieces) and chrome plated fittings at the plant in Chandigarh.

Today the brand has established itself not only in the Indian market but also overseas with a presence in more than 75 countries, particularly the EU, Africa, the Middle East, the UK and Russia.