“I hope we have a smooth transition to the GST system and I am also hoping the IT backbone of the government works smoothly to make GST a pathbreaking success,” feels Chandru Kalro, MD, TTK Prestige. In this quick interaction, he offers insights into company’s readiness towards GST, its slated implications and their zest towards capturing untapped growth avenues…
We are as prepared as we can be in light of the information available so far. The final implications on gains/losses will be known only once the rates are out. There are of course several areas in different functions within the company that are getting prepared for the GST and I think we are fairly GST ready. But we will need more clarity on several areas.
Several areas like IT, secondary logistics, stock keeping, finance and accounts readiness, etc., will face some challenges.We, of course, are burning midnight oil every time there is more information to adapt quickly. We see this in two phases as of now. Phase one, get transaction ready with minimum impacts on stocks carried. Phase two, implement new changes in supply chain to get the full benefits of the GST set off.
Supply chain will witness a huge shift post-GST and there will be a lot of rationalization on the way we deliver product to the market. We are doing a full review of our local depots and seeing how we can now map our customers to an optimized network. My personal feeling is that the benefits will take two to four quarters to kick in. Initially, we see challenges on working capital increases, getting the set offs correctly with the new system, making sure all stakeholders are doing things correctly, etc. This will take time and I hope we minimize the number of mistakes that we might make. I am also hoping the IT backbone of the government works smoothly. Once we are out of the transaction mode, we will of course be in optimization mode.
Having reigned urban markets with its unique product offering, TTK Prestige, a leading kitchen and electric appliance maker in India, now sets its eyes on the rural market this year as the emphasis on infrastructure would mean more houses with kitchens that need appliances. With the announcement of various schemes in the infrastructure sector, there will be new homes in the rural areas leading to more kitchens which would work in favor of the company.
The three segments that the company is working on — electric appliances, pots & pans for kitchens and the cleaning solutions segment introduced last year — are witnessing good consumer traction. The pots and pans business should amount for 52% of the revenue this year followed by 48% by electric appliances. Cleaning solutions is expected to be around 3%, as it is fairly new segment. As per the company’s strategy, the next four quarters will be focused on getting new products to create a wide range in the segment. Currently, there are 15 products in the cleaning solutions segment and is expected to be 50 to 60 products by the end of the year.
“We are also looking at distributions channels. We are using our existing channels but we want to expand further and see where else the opportunity lies,”added Kalro. The company has a vision to grow to Rs 5,000 crore in revenue in the next five years. It will continue to launch over a 100 new products in their kitchen appliances segment. The company is also looking at expanding its exports to reach the Rs5,000-crore mark for which in April last year, it acquired UK-based company Horwood Homewares.