Latest novelty
in the
Ceramics industry:
Digital Printing Technology |
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Hussain Tambawala,
Executive Director,
Malwa Mirage Ceramics, holds a Bachelor and Master of Science degree in Computer Engineering from Carnegie Mellon University - Pittsburgh, PA, USA. He oversees company operations, logistics on a pan India level and also, all corporate communications and direct marketing strategy.
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With rapid urbanization and substantial investments in Real estate development, India's demand for ceramic products is undoubtedly on the rise clocking in nearly 15 per cent of annualized growth over the last five years. Currently, we stand as the third largest producer of ceramic tiles by volume. From a global perspective we face stiff competition from the much more cost efficient Chinese and Brazilian products. Our percentage of exports is negligent especially when compared to China (20 per cent) and Brazil (11 per cent) which will leave the Indian Ceramics industry extremely exposed during economic slowdowns. The Indian industry is also miles behind producing the quality goods that Spain and Italy do have and has to almost exclusively rely on imports for high quality goods.
However, we have much to be optimistic about as Digital Technology begins to put Indian products at par with its foreign counterparts. With the economic slowdowns in Europe threatening local industry, coupled with Yuan's appreciation and the Rupee's depreciation, we have an opportunity to establish Indian products in the international market at competitive rates. But with domestic consumption at an all time high, Indian manufacturers have little need to look outside our borders for growth.
The Indian Ceramic industries currently stands at nearly Rs 12,000 crore and is showing a robust annual growth of 15 per cent. As a part of the larger building materials industry, it is heavily linked to the Construction sector. We are one of fastest growing economies in the world, and while we may be experiencing a slowdown of late, the Real estate segment continues to show strong growth numbers and accounts for five to six per cent of our Gross National Product. We are living in phase of rapid urbanization, a period where disposable income is rising and access to housing finance has never been easier than today. Investment growth in the Retail, Hospitality and Commercial sectors along with favourable government policies is fuelling the demand for ceramic products and will be a major growth driver for much of the remaining decade.
The majority of the current Indian market is flooded with low quality products that would not normally be accepted within the international community. As the market evolves and consumer trends change we will see a rapid change in demand for higher quality and larger sized Glazed Ceramic and Vitrified products. We are already seeing a number of Ceramic tiles manufactures go under as costs rise, margins are sliced and consumers up their demand for higher quality goods. The biggest opportunity that exists today is the one in Digitally Printed Glazed Products. Digital printing technology allows for superior printing resolutions, an unmatched ability to replicate designs as well as numerous production level benefits that ultimately lead to higher savings and better margins. There are already numerous players in this market, which has turned competition stiff and driven prices down, however, the ultimate market share of these products is growing at a scorching rate as factories abandon their reliance on outdated machinery and adopt newer technology.
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From a production perspective, the Ceramics industry is dominated by the unorganized sector which accounts for nearly 70 per cent of the total ceramic output in the country. Most of these production units are based in Gujarat. The remaining 30 per cent is split amongst the organized sectors in various parts of the country.
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The per capita consumption of ceramic products in stands at around 0.38 sq mtrs which is well below the global average especially when compared to the 2.16 sq mtrs per capita consumption of China and six sq mtrs per capita consumption in Italy. Nearly 40 per cent of consumption comes from tier I cities which in perfectly in line with real estate growth.
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The primary raw material of ceramic tiles is clay, most of which comes from Rajasthan. Other raw materials include coal, natural gas, feldspars, alumina and silica based compounds used for glazing. Currently, the industry is facing huge concerns of price inflation primarily due to the rise of fuel prices. Transport prices have seen a surge of nearly 20-25 per cent in 2011 alone. This rise in transport costs along with price hikes in coal and natural gas has sliced the margins on ceramic products and even led to the shutting down of several units.
India is undoubtedly a very large country with major markets in every state. Rising transport costs has led to finished goods becoming more and more expensive as they make their way through the supply chain ultimately affecting demand.
As a manufacturer, we are also looking for support from the government for steady supplies of electricity and natural gas which are key components to producing quality products. We also look to the government to introduce greater transparency in taxation and regulatory practices to improve the overall efficiency of the system.
The latest innovation in the Ceramics industry in India is the rapid adoption of Digital Printing Technology. The development of this technology is credited largely to machinery suppliers from Spain and Italy that have exported their technical expertise to India over the last few years. Digital Printing is a non-contact printing process on glazed tiles that allows to printer higher resolution images with greater accuracy. It can further be calibrated to print on undulated surfaces which allow a whole host of creative opportunities to the manufacturer. This technology which is being rapidly integrated by a large number of manufacturers is a step towards improving the overall quality of Indian products and ensuring that we can compete with imported products.
Our current plans include manufacturing larger format sizes of 30x90cm and 40x80cm. We will foray into the manufacturing of exterior tiles later this year where we will offer digitally printed exterior tiles in a variety of stone finishes. Our biggest step forward will be next year when we plan to set up a new manufacturing unit exclusively for large format double loaded vitrified products.
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