How is KEI differentiating itself from its competitors to attract more business?
Ans. KEI has been serving the nation for over 50 years now. We have a strong back-up for addressing and efficiently rolling out on operational levels. We plan our work accordingly, backed by research and data of the market requirements that helps us in better understanding the need of our customers. We currently manufacture products which match international standards. For our house wire business, we ensure that our wires have higher flexibility and are easy to handle besides having a longer life.
Just to further add, our wires are more energy efficient and are sustainable in any adverse conditions. We also work based on requirements and demands of real estate developers, small scale builders, commercial property builders and contractors for affordable housing. So, our focus is to manufacture quality products which are affordable and address the need of the market and end-users.
Where do you see India’s retail wire sector heading in FY19-20 period? Also how much potential does this sector hold in terms of business growth?
Ans. As the business demand for wires in the real estate business has increased along with increase in housing schemes, this has propelled the growth of retail business for us. We expect our profits to exceed by 30% this year from Rs 1,200 crore, last year.
We are currently expanding our business to tier two and tier three cities and towns through our dealer’s channel. We also intend to go further deep and explore rural markets as well.
Our exports too are supporting us to create more demand for our products.
The government is focused on providing affordable housing. What is your take?
Ans. As the government is focused on providing affordable housing, especially in tier two and tier three towns and cities, we too want to be partnering to this change, which has triggered development across the story. We have continuously engaged with the government to help and execute its vision for affordable housing for all.
How would it impact on demand from moving from BSIV to BSVI? What would be the result of this shift and how are you going to implement these changes?
Ans. KEI’s outlook on the cable sector demand growth is positive for the future. We can attribute the growing demand for cables and wires to several factors like growing demand in solar and wind side of power generation, boom in the amount of infrastructure projects, and conversion of over-head to underground cabling and also due to rise in the steel and refinery sector.
The future of wire industry in India is very optimistic, as opportunity in building-up infrastructure across the country is robust and the upwards shift in the economy will help scale-up the demand for wires and cables.
In the refinery sector specifically, there is an up gradation of fuel from BSIV to BSVI so all the major refineries across the country are revamping their refineries and are undergoing the capex of close to 1,50,000 crore. It is these up gradations that are fuelling lots of cable demand due to the high capex.
How do you see the growth of real estate business in India and demand for houses and flats by first time buyers? How is it benefiting your business?
Ans. The government’s big push to affordable housing has been a great success. Large numbers of projects are coming-up across the country under the Affordable Housing for All. The perception that the demand in the real estate sector has slowed down, isn’t correct. Actually, the resale value of flats and houses have not picked-up and are not growing. The demand from first time home buyers, who are buying houses to live and not rent it, has gone-up out. Infact, real estate companies are surviving because of the rising demand for houses and flats by actual home buyers.
In relation to KEI, our house wire sales, lighting of housing and power point in the housing is growing almost 35% – 40% every year. Our retail has grown to almost 33% of our turnover with regards to our total sales. We are positioning our KEI brand to take it up to 40% in next two years.