Mr. Niraj More, Managing Director, Grauer& Weil India Ltd. hails from a Mumbai based, well established business family and holds a Bachelor of Science degree in Business Administration from The New Hampshire University, London. After finishing his academics in 1991, Mr. More joined Grauer& Weil (India) Ltd., the flagship company of the Growel Group. In 1994, the group added into its fold Bombay Paints Ltd., a company engaged in the manufacturing of High Performance coatings for the Industrial, OE and Marine industry. Steadily, he ventured into manufacturing of Industrial Lubricants and Phosphating Chemicals also. After careful assessment and study, Mr. More then relocated the group’s production facilities from the various metros to different tax havens across the country and ventured into Real Estate development. This strategic diversification happened due the availability of land bank within the group, owned in the various metro cities of India.
For over 50 years, Grauer & Weil India Ltd. has been synonymous with the metal finishing industry. Its trail blazing growth has resulted from a relentless commitment to Research & Development (R&D) and the forging of global alliances that enables the Company to offer one of the most comprehensive range of metal finishing processes, complemented by state-of-the-art equipment and plating plants. The Company manufactures virtually the entire range of metal finishing chemicals, as well as all types of equipment and plating plants made to international specifications and supplied to exacting standards the world over. Grauer & Weil is one of the very few metal finishing houses globally, capable of offering an integrated package of chemicals, plants, effluent treatment systems and waste recovery techniques from spent solutions. Grauer & Weil has presence in the fields of surface finishing chemicals, engineering, high performance paint, industrial lubricants, information technology, real estate development and environment management.
In an exclusive interaction with Hemant P. Maradia of IIFL, Mr. More says, "Grauer & Weil India Ltd. has been leaders in the electroplating business for over 35 years and enjoys a market share of 50%."
What is electroplating all about? What is the addressable market size in India?
Electroplating (often just called "plating") is the deposition of a metal coating onto an object by putting a negative charge on it and putting it into a solution which contains a metal salt. The metal salt contains positively charged metal ions which are attracted to the negatively charged object and are "reduced" to metallic form upon it.
The industries which use plating are: - Automobiles, Hardware, Electronics, Jewellery, Aeronautics, Railways, Defense, etc.
The market size of additives is approximately Rs5.5-6bn.
Who are the leaders in this business? What is your market share?
‘Grauer & Weil India Ltd. has been leaders in the electroplating business for over 35 years with a growing presence in both the domestic and international markets.
Our market share is about 50%.
What makes you unique? What is your USP?
Growel’s Value Proposition is driven by its extensive investments in R&D. The R&D division is recognised by the prestigious Indian Council of Science and Technology, since 1977 for its contribution to the field of plating.
Led by a highly trained and qualified team, the Company has successfully pioneered many products and systems in response to the ever changing market requirements. Its efficacy can be judged from the fact that almost 40% of our sales originate from products developed or modified in the last two years.
The Company has the largest dedicated technical sales and marketing team. The sales team is extremely customer focused, and undergoes regular training and orientation in both technical and soft skill areas.
It is our firm belief that every sale is the beginning of a long-standing relationship.
Grauer & Weil is the only company in India and one of the few in the world that offers a complete package, consisting of electroplating plants, chemicals, effluent treatment and waste recovery systems under one roof. This makes us truly a one-stop-shop for electroplating.
You are present in a slew of segments? Would you shed some light on the potential for each one of them?
Paints: - The total market size for industrial paints is about Rs80bn. There is a huge potential as it is directly related to infrastructure growth. Presently we have a small market share of 0.6% at Rs500mn.
Plating: - It is a niche market with few players. We have managed to retain leadership in India and are now looking at the overseas markets.
Lubricants: - The market size for industrial lubricants is estimated at Rs120bn. We have just entered this business with a JV with Sidasa SA from Spain.
Real Estate: - We have just forayed into the real estate development business, prompted by a battery of properties owned by the Group in close vicinities of the fast developing cities of India. We have built a Retail project in Mumbai and plan to build IT parks and Commercial complexes in the future.
Effluent treatment: - Because of the growing concerns about environment, the demand for effluent treatment and waste water treatment are increasingly becoming a necessity in all industrial development zones. Earlier, we used to cater specifically to the Electroplating industries. Now we cater to Textiles, Manufacturing and other industries.
Wouldn’t be prudent to focus on your core strengths only and exit other segments?
Apart from Real Estate, all the other sectors are synergetic. Growel offers corrosion protection and surface coating in various forms - paints, plating and lubricants. Most of the customers are same for all these sectors. We are using our long standing relationship with the same customers to cater other products which are consumed by them.
Real Estate on the other hand was an opportunity which arose from the different land banks owned by the Group.
Is there any kind of restructuring or reorganisation on the cards?
Restructuring and change are a part and parcel of a growing organization. We are reorganising all sectors into separate business units which will have individual profit center heads, so as to optimize each potential to the fullest.
Could you give us a break up of revenue in terms of segments? What kind of revenue mix do you see in FY11 and beyond?
Presently out of the total group revenues, Electroplating constitutes 75%, Paints – 20%, Real Estate – 3% and Lubricants – 2%. In the coming years, we see Paints and Lubricants to be high thrust areas, which should constitute nearly 40% of our total turnover.
What kind of margins do you enjoy in electroplating? What is the outlook going ahead?
Plating being a specialised sector, we enjoy higher margins compared to Paints and Lubricants, which are more commodity products and are highly competitive due to volatility in the petroleum prices.
What kind of price trend are you witnessing in raw materials?
Electroplating depends on metal prices and is influenced by the London Metal Exchange or LME prices. The more specialised intermediates are manufactured inhouse.
Tell us briefly about your plants?
Growel’s chemicals are manufactured at four locations - Dadra and Vapi in the west, and Barotiwala, Jammu in the north. Each of these plants employs the latest technologies to ensure a consistent flow of high quality products in a pollution free environment.
With modern, state-of-the-art laboratories, manned by highly experienced personnel, all production units have been revamped in the last 10 years to keep pace with the most modern techniques.
We have enough spare capacities to take additional loads.
What is your expansion plans? How do you plan to fund the same?
We have recently commissioned a new plant at Jammu for electroplating, and plan to shift our Lubricants production to the north.
Are you open to inorganic growth or acquisitions?
We are looking at both kinds of growth for different sectors - backward integration and acquisitions.
What is your revenue/profit target?
Our revenue target is Rs4bn for FY11, and we are aiming to touch Rs10bn in FY13
What is your message to the shareholders?
The Company is well regarded in the chemical industry due to its competitiveness on price and quality, coupled with its strict adherence to environmental norms. This is also evident in the fact that it is catering to and partnering with some of the leading names in the surface finishing industry, and has been able to enter into long-term contracts with both suppliers and customers, thereby enhancing the durability of the business model.