India’s growth picture is as clear as glass for Saint Gobain

Purva Marwaha - 15/02/18

Saint Gobain, the French maker of plasterboard and glass, is betting big on the Indian market and is aiming to triple revenues in the next ten years to ₹20,000 crore, its chairman said. “India is one of the fastest growing countries for Saint Gobain. India is the number one country for us — even more than China,” Pierre-Andre De Chalendar, chairman of the Saint-Gobain Group, told ET in an interview recently.

About €130 million, or 10% of Saint Gobain’s investment capex, find their way into India that contributes only 2% of its sales. The share of India in total manufacturing is around 4%, he added. The last three years have seen the French company plough back all the profits it made in India to grow its business here.

Chalendar is encouraged by the proactive reforms undertaken by the Indian government.

“There has been a progressive reduction in bureaucracy. The tax reforms of last summer have been good. So, I am positive about the economic climate in India. It’s improving and I am confident that it will continue to improve.”

Saint Gobain was set up in France in 1665, and made glass for the French King Louis XIV. It is present in India through three entities.

“…at the moment in terms of growth capex, India is the number one country for us, even more than China,” Chalendar said.


The company has grown by 19% since 1996 when it started operations in India through its listed company Grindwell NortonBSE 0.78 % (GNO). Over the years, capital expenditure for growth in the country has been the highest in all the countries that it has businesses in, amounting to around $100 million in the last few years.

“Most of our investments in India have been funded by our existing company in India. It is a sign of the strength of our Indian business. So, we plough back all our profits in India. We haven’t sent money out of India for the last few years now. The cash that we generate, we invest back,” Chalendar added.

In India, its biggest investment is in the glass business. It is the market leader in making glass for buildings, automotive windshields etc, and value-added glass like coated glass. The other business is gypsum plasterboard which is in the materials space and abrasives, refractories, high-performance plastics etc.

“It is a sign of the strength of our Indian business,” Anand Mahajan, chairman of Saint Gobain Group in India, told ET in the same interview. Mahajan has been steering the group since its inception in India and leads a wholly Indian team in a French company, a fact that Chalendar takes pride in while talking about the glassmaker’s key successes in India.

What gives Chalendar the confidence to bet on India is the rising demand that the company is seeing from its glassmaking segment. It makes flat glass that is used as windshields in automobiles and in buildings, where demand for green alternatives is pushing the sales up for its coated glass. 

 

 

 

Source:  Economic Times, http://bit.ly/2o1vtoj

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  Lifestyle, Consumer Goods and Healthcare The Consumer Goods and Healthcare Department assistsFrench companies in their international development strategy and promotes trade between France and India. In order to maximize commercial opportunities between French and Indian companies, the Department organises French Pavilions at a number of key exhibitions in India, as well as offering other B2B networking events and individual partnering services. The Department provides expertise in : • Fashion and Accessories • Home Furnishing and Interior Design • Cosmetics, OTC and Natural products • Healthcare Equipment and Biotechnology Head of Department  : Ms. Brinder RAULT brinder.rault@businessfrance.fr

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