Market analysis of Sanitary Ware brands in India and Thailand
Posted on April 01 2022
Recently, the capacity expansion of Indian bathroom brand manufacturers has made slow progress, and the Indian economic monitoring center even predicted that the speed of capacity expansion will decline sharply. In this case, large sanitary ware brand manufacturers in India are adopting the asset light mode, reducing capital expenditure, enriching product series and improving market share.
With the strengthening of consumers' brand awareness and the increasing production cost, small-scale and mismanaged bathroom brand manufacturers can not improve their performance, so they embark on the road of merging with large manufacturers. For small manufacturers, the merger has improved the original chaotic management situation. For large manufacturers, large profits are obtained with small investment, production capacity is supplemented, product supply is stable, and then seize the market with their own strong marketing network and brand appeal.
Not long ago, Indian somany sanitary ware brand company acquired the shares of vicon and Amora, two morby sanitary ware brand manufacturers, holding 26% and 51% respectively. Among them, the manufacturer of vicon sanitary ware brand has an annual output of 3.9 million square meters of ceramic tiles, while the manufacturer of Amora sanitary ware brand has an annual output of 2.4 million square meters of ceramic tiles. Somany will invest 150 million rupees to obtain 6.3 million square meters of production capacity. According to the equity ratio, this means that the average investment capital per square meter of ceramic tiles is 67 rupees. If somany develops a land to build a production line in Kadi, it needs to invest 202 rupees to produce one square meter of ceramic tiles, which is three times the cost of the acquired equity.
In India, large bathroom brand manufacturers such as kajaria, somany and H & r all expand their production capacity by means of joint venture. The Indian Economic Monitoring Center predicts that this model will become more and more prosperous.
It is reported that the operating revenue of star Sanitaryware, a Thai listed sanitary ware company, is expected to reach 200 million baht this year, with a growth rate of 40%. Next year, the company is committed to increasing its revenue to 250 million, an increase of 25% again.
Last year, due to high cost and low price, star sanitaryware suffered a loss of 143 million baht, the worst financial performance in the company's history. Somchai wongaroon, President of the company, said: "with the expansion of the local market in Thailand, our revenue has also increased. At the same time, the company's active market expansion actions and the new sanitary ware standards issued by the government have also played a great role in promoting the company's business."
Thailand imported 1 billion baht worth of sanitary ware from China last year, but 95% of them did not meet Thailand's industry standards. In the first half of this year, Thailand's local demand increased dramatically. Thailand's local sales revenue accounted for 54% of the company's revenue, compared with only 30% in the past decade. Star sanitaryware will launch a new product next month. At that time, the company will strengthen its efforts to expand the mainland market.
At the same time, the company will be committed to expanding the markets of non protocol, Vietnam, Cambodia, Myanmar and other ASEAN countries. In these countries, the demand for high-end sanitary ware brands is growing rapidly. Somchai wongaroon, President of the company, said: in these countries, the focus of market promotion will be Myanmar and Cambodia, because these two countries do not have their own sanitary ware manufacturers. In addition, the Indonesian market is also very important.
It is understood that since 2010, China and ASEAN countries such as Brunei, the Philippines, Indonesia and Thailand have implemented zero tariffs on 90% of trade products, and China's average tariffs on ASEAN have also been reduced to 0.1%. Chinese sanitary ware brand products can enjoy tariff preference when entering the ASEAN market. A large number of sanitary ware products of Chinese Sanitary Ware brands are exported to Thailand every year. However, as mentioned in the article, Thailand implements the new standard of Sanitary Ware brands, and a considerable number of Chinese products do not meet this standard. Therefore, Chinese exporters should know more about the details and make certain adjustments to their products in order to establish a firm foothold in the Thai market.
In addition, Myanmar and Cambodia do not yet have their own bathroom brand sanitary ware manufacturers. Chinese exporters should lock in these two countries like Thai companies in order to get a share there.