A REPORT

ON

MAPPING RETAIL REACH AND PENETRATION OF HINDWARE –ATLANTIC

WATER HEATER IN DELHI & NCR MARKET.

By

SHASHI BHUSHAN

Enrolment No: 15BSP1161

Hindustan Sanitaryware & Industries Limited

A REPORT1

ON

MAPPING RETAIL REACH AND PENETRATION OF HINDWARE –ATLANTIC WATER HEATER IN DELHI &

NCR MARKET.

By

Shashi Bhushan

Enrolment No: 15BSP1161

Hindustan Sanitaryware & Industries Limited

A report submitted in partial fulfilment of

The requirements of

PGPM Program of

IBS GURGAON

Distribution list:

COMPANY GUIDE: Mr. Shashank Shrivastva (Marketing Head, HSIL limited)

FACULTY GUIDE: Prof. Nidhi Tak (Faculty Member, IBS Gurgaon)

Date of Submission:

AUTHORIZATION

2

The project report titled as ― “Mapping retail reach and penetration of hindware – atlantic

water heater in Delhi & NCR market” has been authorized by Mr. Shashank Shrivastva

(Marketing Head, HSIL limited), and Prof. Nidhi Tak, faculty guide, IBS Gurgaon. The

report is submitted as a part of the evaluation for Summer Internship Program and is as a

partial requirement of PGPM Program of IBS Business School, Gurgaon.

SHASHI BHUSHAN

Enrolment No: 15BSP1161

IBS Gurgaon

Prof. Nidhi Tak Mr. Shashank Shrivastva

Faculty Guide Marketing Head

IBS Gurgaon HSIL limited

ACKNOWLEDGEMENTS

3

I wish to express my deepest gratitude to Mr Shashank Shrivastva (Marketing Head, HSIL

ltd.), for his guidance, as without the direction given by him; I would not have been able to

capitalize on the experiences & knowledge gained during the internship. I am thankful for

sensitizing me to reflect on the experiences and view them from a different perspective in

order to make the entire journey more enriching and worthwhile.

Also I would like to sincerely thank my faculty guide Prof. Nidhi Tak IBS, Gurgaon for his

genuine support, valuable advice and sincere comments which helped me a lot to accomplish

this project.

Shashi Bhushan

EXECUTIVE SUMMARY

4

The report “Mapping Retail reach and Penetration of hindware-atlantic water heater in Delhi

& NCR Market” contains present scenario in water heater selling via dealer’s chain and

market study of competitor in this segment.

Hindustan Sanitaryware & Industries Ltd. is one of the top most companies in India and even

being in the elite position it was noticed that it is only able to cover retail outlets which is not

even close to half of the total number of retail outlets present in the market.

Water heater industry in India is facing stiff competition after liberalization and

modernizationt.

A water heater segment has expanded and various companies are getting into Indian markets

to ear n a share of the new profits. With increased purchasing power and decreased waiting

time, people are now getting more & more attracted towards this segment, they want new

technologies with best quality and features. However, there are various factors that a

consumer considers during this process of purchase. Dealers are also attracted towards this

segment, with a view to good margin and service of the company. A report contains

information which collected by field survey in Delhi & NCR region. By visiting various

dealers I came to know about the product and their policy of selling and views about the

hindware as well as knowledge of water heater market. There were many reasons found by

me towards hindware-atlantic water heater which are not selling much better in the market

compare to other brands. I analysed challenges and parameters of success which mainly

concern with water heater market. I found more than 15 companies who selling water heater

other than hindware-atlantic water heater in Delhi & NCR zone among them 8 companies

who have good market position because of their brand awareness, good margin and credit

5

policy given to dealers. I visited more than 80 dealers but 60 dealers replied positively and

help me in research process.

The objective of this study is to identify un-tap potential market and measure the amount of

sales or adoption of a hindware – atanctic water heater as compared to the total theoretical

market for water heater product or service. Also study the market of certain areas and find out

the shortcomings and problems faced by our product.

The methodology comprises of primary data i.e. observations and interviews & secondary

data i.e. information acquired from internet and magazines.

6

TABLE OF CONTENTS

Authorization 3

Acknowledgements 4

Executive Summary 5

Chapter 1: Introduction

1.1 Industry Profile1.2 List of top water heater companies in India1.3 Industry Overview1.4 Growth and development1.5 Challenges1.6 Porter's Five Forces Model

8

810111212

Chapter 2: Hindustan Sanitaryware & Industries Ltd.

2.1 Company Background2.3 Evolution of HSIL2.4 Vision, Mission & other strategies2.5 Quality Policy & Objectives2.6 Business Profile2.7 SWOT Analysis

1416181924

Chapter 3: Project, Process & Learning

3.1 Objective3.2 Methodology3.3 Finding3.4 Suggestion and Conclusion3.5 key leaning

2829302841

References 44

7

1. OVERVIEW OF CONSUMER DURABLES MARKET

1.1 Overview

India is expected to become the fifth largest consumer durables market in the world

by 2025. The consumer electronics market is expected to increase to USD 400 billion

by 2020. The production is expected to reach USD 104 billion by 2016.The sector is

expected to double at 14.7 per cent compound annual growth rate (CAGR) to USD

12.5 billion in FY15 from USD 6.3 billion in FY10.

Urban markets account for the major share (65 per cent) of total revenues

in the consumer durables sector in the country. Demand in urban markets is

expected to increase for non-essential products such as LED TVs, laptops, split

ACs and, beauty and wellness products. In rural markets, durables like refrigerators

as well as consumer electronic goods are likely to witness growing demand in the

coming years as the government plans to invest significantly in rural electrification.

The Government of India has increased liberalisation which has favoured foreign

direct investments (FDI). Also, policies such as National Electronics Mission and

8

digitisation of television and setting up of Electronic Hardware Technology Parks

(EHTPs) is expected to boost the growth of this sector.

The consumer durables market is anticipated to expand at a CAGR of 14.8 per

cent to USD 12.5 billion in FY15. Also, the demand from rural and semi-urban

areas is projected to expand at a CAGR of 25 per cent to USD 6.4 billion in FY15,

with rural and semi-urban markets likely contributing majorly to consumer durables

sales.

Before the liberalization of the Indian economy, only a few companies like Kelvinator,

Godrej, Allwyn, and Voltas were the major players in the consumer durables market,

accounting for no less than 90% of the market. Then, after the liberalization, foreign

players like LG, Sony, Samsung, Whirlpool, Daewoo, and Aiwa came into the picture.

Today, these players control the major share of the consumer durables market.

Consumer durables market is expected to grow at 10-15% in 2007-2008. It is growing

very fast because of rise in living standards, easy access to consumer finance, and wide

range of choice, as many foreign players are entering in the market

With the increase in income levels, easy availability of finance, increase in consumer

awareness, and introduction of new models, the demand for consumer durables has

9

increased significantly. Products like washing machines, air conditioners, microwave

ovens, color televisions (CTVs) are no longer considered luxury items. However, there

are still very few players in categories like vacuum cleaners, and dishwashers

Consumer durables sector is characterized by the emergence of MNCs, exchange offers,

discounts, and intense competition. The market share of MNCs in consumer durables

sector is 65%. MNC's major target is the growing middle class of India. MNCs offer

superior technology to the

Consumers whereas the Indian companies compete on the basis of firm grasp of the local

market, their well-acknowledged brands, and hold over wide distribution network.

However, the penetration level of the consumer durables is still low in India.

Classification of consumer durables sector

1. Consumer electronic include Vcd/Dvd, home theatre, music player, color television

(CTVs), cameras, camcorders, portable audio, Hi-Fi, etc

2. White goods include dishwashers, air conditioners, heaters, washing machines,

refrigerators, vacuum cleaners, kitchen appliances, non-kitchen appliances, microwaves,

built-in appliances, Tumble dryer, personal care product etc.

3. Moulded luggage include plastics

4. Clocks and watches

5. Mobile phones

Scope:-

1. In term of purchasing power parity (ppp), India is the 4th largest economy in the world and overtake Japan in the near future become the 3rd largest.

2. Indian consumer durable market is expected to reach $400 billion by on 2010

10

3. India has the youngest population amongst the major countries. There are lot of people in the different income categories nearly the two third population is below the age of 35 and nearly 50% is below 25.

4. There are 56 million people in middle class, who are earning us$4,400-US$21,800 a year. And there are 6 million rich household in India.

5. The upper-middle and high-income household in urban areas are expected to grew to

38.2 million in 2007 as against 14.6 million in 2000.

Opportunity:-

1. In India the penetration level of white goods is lower as compared to other developing

countries.

2. Unexploited rural market.

3. Rapid urbanization.

4. Increase in income level, i.e. increase in purchasing power of consumers.

5. Easy availability of finance.

Threats:-

Higher import duties on row materials.

Cheap imports from Singapore, China and from other Asian countries.

11

Water Heaters Industry

“India Water Heaters Market ”, water heaters market in India is expected to cross

USD330 million in 2015. Major factors driving water heater sales in India include

increase in disposable income, improved standard of living and rising awareness among

consumers regarding benefits of branded water heaters. Residential sector is currently the

largest revenue contributor in India water heater market. The high contribution of

residential sector can be accredited to the increase in housing projects in the country.

However,water heater use in India is not limited to residential sector as they are

increasingly being adopted in industrial and commercial sector as well.

Water heaters in India are emerging as technologically upgraded and innovative products.

Electric water heaters are currently the most popular among consumers. Although electric

water heater market is moving towards maturity, continuous innovations on the part of

manufacturers are driving growth in the market. In addition, solar water heaters are

anticipated to gain prominence in India water heater market over the next five years.

Growth in solar water heater market is being propelled by government efforts and demand

among consumers for energy efficient and eco-friendly products. Gas water heater market

in the country is still at a nascent stage, but is expected to pick pace on the back of

government plans to extend piped gas network.

Major players in India water heaters market are Racold, Bajaj, Venus, V-Guard and AO

Smith , hindware among others. The market is currently dominated by Racold followed

by Bajaj and Venus. Moreover, foreign companies like Ferroli are entering the market

with innovative products. Ferroli started its operations in India in 2013 by bringing in a

premium range of first of their kind Wi-Fienabled water heaters in the country. Other

12

small and medium sized companies also hold a significant share of around 25% in the

market.

“Water heater manufacturers in the country are facing stiff competition from unorganized

sector and Chinese imports, which provide cheaper products. Indian consumers have

limited awareness of technology and consider water heater an ordinary electrical

appliance, giving not much importance to its specifications. However, this trend is

changing with increasing awareness regarding safety risks that these cheap alternatives

pose. Over the next five years, changing consumer preference, along with energy

efficiency and quality standards, is expected to increase opportunities for market players

in the organized sector.” said Mr. Karan Chechi, Research Director with TechSci

Research, a research based global management consulting firm.

13

LIST OF TOP 10 WATER HEATERS COMPANIES IN INDIA

Table 1.

Top water heaters Companies

SerialNo.

Companies

1 Midea

2 Morphy Richards

3 Ao Smith

4 Ferroli

5 Usha

6 Havells

7 Venus

8

9

10

Crompton

V-Guard

Bajaj

14

INDUSTRY OVERVIEW

Appliances that utilize different energy sources to heat water above its initial temperature in

order to provide water in the different range of temperatures are called water heaters. Water

heaters are widely used in many domestic applications such as cooking, bathing, cleaning,

and space heating. Water heaters also find wide applications in the manufacturing industries

such as chemicals, food and beverages processing, and thermal power plants. Water heaters

utilize various energy sources, such as gas, electric, solar, and geothermal, to heat and supply

hot water.

 

The global water heater market is driven by factors such as a development of hybrid solutions

in order to cater to the demand for energy-efficient, high-performance, and easy to install

water heaters, rising popularity of renewable technologies, and replacement of old tanks,

among others. Strategic alliances by players across the value chain of the market are playing

a key role in catering to the demand for water heaters across the domestic markets.

 

The global water heater market report begins with an overview of different types of water

heaters and fuel types used in water heaters.

The water heater market is segmented by:o Product Type

o Storage Type

o End-use

Growth and development

15

1. Benefit of Rise in share of income.

2. Availability of new varieties of products.

3. Product pricing.

4. Availability of financial schemes.

5. Rise in share of organized retail.

6. Innovative advertising and brand promotion.

Challenges

1. Threat from new entrants, especially global companies.

2. Challenges and competition.

3. Threat from substitute products/services.

4. Customer power with respect to availability of choices.

Success in industry would depend on addressing key factor

1. Market positioning and branding

By addressing customer requirements that act as demand drivers by proactive

marketing and establishing strong brand association.

2. Product technology

By providing technological benefit to the customer through low power consumption,

low service requirement, low cost of operation with reasonable price range with

multiple range of the product.

3. Distribution and service networks

16

By addressing proper distribution and service network of the product is key factor in

this industry. Distribution networks and brand recognition will continue to play

significant roles.

4. Attractive locations

By addressing proper location of distribution channels and outlets, and

operational department is play important part in this industry.

17

MICHAEL PORTER'S FIVE FORCES MODEL:

Competitors rivalry:

Number of well-established player, with new players entering

Good technological capability

Many untapped potential markets

Threat of New Entrants:

Most current players are global players.

New entrants will need to invest in brand, technology and distribution.

Threat of Substitutes:

Technological Enhancement.

Bargaining power of customers:

Multitude of brands across price points- wide variety of choice for customers.

Bargaining power of Suppliers:

Indigenous supply base limited- most raw materials are imported

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Hindustan Sanitaryware & Industries Limited

COMPANY’S OVERVIEW

The Company was incorporated as Hindustan Twyfords Ltd. in 1960 by the Somany family

(promoter group) in collaboration with Twyfords Ltd., UK, to introduce vitreous china

ceramic sanitaryware in India.s

The Company changed its name to Hindustan Sanitaryware & Industries Limited in 1969 and

has since been popularly known as ‘HSIL’. In March 2009, the company name changed to

HSIL Limited".

Product portfolio

The Company is the most respected sanitaryware manufacturer in India today.

It diversified into the manufacture of glass containers through the acquisition of Associated

Glass Industries Limitedin 1981.

It widened its product basket with a range of bathroom and kitchen appliances products,

leveraging the power of the Hindware brand.

It expanded in the retail business of Speciality Home Interior Solutions in 2007 through a

wholly owned subsidiary, called Hindware Home Retail Pvt. Ltd. (HHRL). Its first store

commenced operations in May 2008 under the ‘EVOK’ brand.

Prestige

The Company’s Hindware brand has been recognised as a Superbrand for the last four years

in a row.

It holds a significant market share in all the business verticals of its presence.

19

Its institutional customers in the Building Products Division comprise reputed builders like

DLF, Unitech L&T, Raheja’s and Puravankara.

Its institutional customers in the Container Glass Division (AGI) comprises brand-enhancing

names like Coca Cola, Pepsi, GlaxoSmithkline, Pfizer, AstraZenca, Ranbaxy, Dr Reddy’s

Laboratories, Hindustan Unilever, Priya, Global Green, Continental Coffee, Reckitt

Benckiser, Seagram, Sab Miller, McDowell, Shaw Wallace and United Breweries to name a

few.

It possesses the largest distribution network in India’s building products industry, supported

by 1086, 4109, and 6000 dealers, sub-dealers and retail outlets respectively.

Public holding

The Company’s shares are listed on the Bombay Stock Exchange and the National Stock

Exchange.

Presence

The Company is headquartered in New Delhi, supported by four regional offices and four

area offices.

It derived nearly 89.87% of revenues from within India and 10.13% from exports to 54

countries in 2007-08

 

SeqBusiness segment Location Annual capacity

1 Building Products Division Bahadurgarh (Haryana) 14,000 MT

2 Building Products DivisionSomanypuram, (Andhra

Pradesh)18,000 MT

3Container Glass Division

(AGI)Sanathnagar (Hyderabad) 953.10 million pieces

 

.

20

HISTORY

&

EVOLUTION OF HSIL LIMITED

Since its foundation, HSIL has seen its fair share of challenges and over the years has had a

steady growth and success. Some of the milestones in Hindware’s journey are listed below

year wise. 

Year Achievements

1960 Hindustan Twyfords Ltd. was incorporated to introduce vitreous china sanitaryware for the first time in India

1962 A factory was set up and production commenced in Bahadurgarh, Haryana (earlier part of Punjab)

1967 Company renamed to Hindustan Sanitaryware & Industries Limited

1981 Expanded business into container glass manufacturing through the acquisition of Associated Glass Industries Ltd.

1982 Mr. Sandip Somany joined HSIL with focus on business growth;AGI Furnace upgraded to increase the capacity

1986 AGI upgraded I.S. machines; introduced Electronic control & Lehr Temperature control systems

1989 Acquired Krishna Ceramics Ltd. (Bibinagar); expanded ceramics manufacturing capacity

1990 Commissioned world’s largest open flame kiln in the Bahadurgarh factory

1991 Introduced the Hindware Brand

1992 Accessed natural gas in the Bahadurgarh plant

1994 AGI initiated in-house mould designing through CAD and high precision CNC machines

1996 HSIL crossed the Rs.100 core revenue milestone

1997 Launched water conservation product, with 3.5 litre flushing - Super Constellation water closet

1998 Established the Secunderabad office for Building Product DivisionProduct category expanded to introduce PVC cisterns as part of the Hindware portfolio

1999 Raasi ceramics acquired to further expand sanitaryware manufacturing capacity

21

Bibinagar capacity expansion completedISO accredition received by Bahadurgarh PlantFirst Indian Plant in the sanitaryware industry to receive this prestigious accredition

2000 Hindware established online presence with their websiteBuilding Products Division expanded to Bathroom Wellness category (Bathtubs / Showers / MFMT’s etc.)

2001 ISO 9001:2000 Certification received by Building Product Division

2003 Strategic Partnership Agreement with Sanitec for introducing high-end Keramag Brand in the Indian market

2004 Building Products Division expanded to chrome plated bathroom fittings (faucets)Rebranded the Hindware logo for a youthful presentationLaunched light-weight flat flint bottlesAGI upgraded production technology to make it one of the most flexible production facilities in the country

2005 HPC (Mauritius) Ltd. invested USD 12.2 million and acquired 14.99% stake in the company

2006 Expanded export business

2007 HSIL crossed the Rs. 500 core revenue milestone

2008 HSIL entered the home interior fashion design retail industry through its subsidiary HHRPLEstablished two retail megastores in NCREstablished corporate office presence in GurgaonBPD achieved the highest production levels of 31,000 MT

2009 The company was renamed to HSILLaunched Hindware Lacasa display showroomsBhongir greenfield project commenced production, significantly expanding capacity of container glass business

2010 Awarded the Golden Peacock National Quality Award 2010Honoured with the prestigious THE BIZZ 2010 award for being an inspirational organization with admirable business management systemsAwarded the 2010 IMM Award for Excellence by the Institute of Marketing and Management, DelhiAcquires the bath fittings business and operations of Havel’s India LimitedAcquires UK based Bar wood Products Limited.

22

Hindware wins 4 P's Award for India's 100 Most Valuable Brand 2010Hindware forays into the tiles segmentHindware chosen as a leading Power brand 2010HSIL again awarded Business Super brand Award

2011 HSIL Launches Premium Bath Fittings Brand BENELAVE

2011 HSIL Launches Luxury Brand QUEO

2012 Became the first Indian company to be felicitated with the UPC star rating by the International Association of Plumbing and Mechanical officials (IAPMO)

2013 Awarded with the prestigious GRIHA (Green Rating for Integrated Habitat Assessment) certification

2013 Honoured with the ‘Best Bathroom Fixtures’ Good Homes Award by ZEE channel

VISION

Passionately strive to enrich customer’s quality of life thereby enhancing stakeholder value.

MISSION

The mission of HSIL limited is to continuously maximizing company’s wealth by

manufacturing and marketing best quality engineering products that go into daily life.

SHORT TERM OBJECTIVE:

To improve image to shareholders.

To improve internal processes and controls.

LONG TERM OBJECTIVE:

To be the lowest-cost producer in the market.

To become largest volume player in the customer durable industry

BASIC STRATEGIES:

23

New product development

New market development

Outdoor promotion

Rural thrust

Cost management

QUALITY POKICIES:

Customer Satisfaction

Total quality management

Continuous up gradation of technology

Improvement in processes

Focus to meet emerging needs of the customers

Mutually dependent lasting relationship with co-packers, associates and suppliers.

Environment responsibility

Development of human resources

Improving skills and knowledge

QUALITY OBJECTIVES:

Reduction in customer complaints

To start documentation of market returns dealer wise

To empower the workmen on individual work area to ensure that only quality product

are passed on the next page of production.

Continuous training for the development of human resources.

To minimize the accident level.

24

hindware Atlantic

 HSIL Ltd has forged an alliance with Groupe Atlantic to launch cobranded water heaters in

Indian subcontinent. A collaboration that brings in technologically advanced products to the

Indian consumer.

With the latest in technological advancement, superior consumer and safety features,

products made in a state-of-the-art manufacturing plant in Thailand, this association is going

to be tremendously beneficial for the consumers and trade partners

‘Hindware’, has strategically signed a long-term sourcing agreement with French thermal

comfort solutions major Groupe Atlantic to sell water heaters and geysers under the co-

branded identity — hindware-atlantic.

Under the agreement, the company will sell water heaters in the Indian market this month,

beginning with 10–25-litre capacity models which occupy over 75 per cent of the market,

priced between Rs 9,990 and Rs 11,490.      

“They are venturing into the water heater/geyser business for the first time, with the former

pegged at Rs 1,500 crore, and growing at a CAGR of 15-30 per cent. Over the next three

years, however, the same market in India is poised to hit the Rs 2,000-crore mark,” HSIL 

President and Chief (Consumer Business) Rakesh Kaul told Deccan Herald.

HSIL’s consumer products arm is currently involved in the production and sale of kitchen

25

appliances and extractor fans. With the launch of hindware-atlantic, the company is aiming at

a 10 per cent water heater market share in three years, garnering a business of Rs 250 crore.

“Over 40 per cent of the water heater market comprise of the unbranded segment, with few

very large players. With their new co-branded range, they are offering a set of tech smart

water heaters, which are also energy efficient”.

The SKUs for water heaters from hindware-atlantic will be sourced from Groupe Atlantic’s

plants in Thailand and Egypt, and over the next 24 months will be sold across India through

online platforms, and electrical, electronic, and sanitary outlets (around 2,500 retail outlets).

Groupe Atlantic’s push 

The initiative will allow the €1.3-billion Groupe Atlantic to enter the Indian market. The

company is a reputed name in Europe for its sustainable water heating solutions, which are

likely to come to India in the near future.

“Solar energy is one of the areas that may be explored. But there is a large price difference

between solar and electric energy for heating purposes. In many markets, there are subsidies

for the former. Hence, we need to study the Indian market thoroughly, but are confident that

it is a promising one,” Atlantic International Sales Manager (Middle East and French

Overseas) Serge Raveyre said. 

HSIL will launch its 1–6-litre heater line, and will also get into the larger capacity 50–100-

litre water heaters. “HSIL’s total turnover as of March 2015 was Rs 1,965 crore. In the next

three years, we believe consumer products will take up 15 per cent of the overall business,”

26

About GROUPE ATLANTIC

Founded in 1968 in la Roche-sur-Yon on the west coast of France, the Atlantic

Group is a leading French company in climate control engineering. 

Constantly attentive to our markets, our various brands offer customers a range of

products that meet all types of needs: water heaters and electric heaters, domestic and

collective boilers, air conditioning, ventilation, and renewable energy sources.

The company's experience with multiple energies (electrical, gas, domestic heating

oil, solar, etc.) enables it to operate across the entire climate control engineering

market (collective, domestic and service sector applications).

Reliable, varied and high-quality products

The Atlantic Group uses cutting edge technology and the expertise of its highly

qualified and motivated teams to design and develop products that reflect modern

demands for comfort.

4% of turnover is invested in research and development to provide a constant impetus

for innovation. Patent applications are regularly submitted and the Group enjoys great

commercial success.

27

International expansion

The constant attentions focused on market growth, innovation and product

development gives the Atlantic Group unique, internationally acknowledged

expertise.

The brands and products are now distributed in more than 100 countries worldwide

and the Group's international activity is growing steadily.

After its roll-out in Western Europe, our Group was rolled out in Eastern Europe, the

Near East, and the Middle East. 

More than 1000 employees currently work on our new manufacturing sites or in our

international subsidiaries.

Steady growth

With 40 years of industrial and commercial activity behind it, the Atlantic Group

continues to grow steadily year on year. Our turnover and employee numbers have

thus regularly increased, both in France and internationally with 4400 employees and

950M euros in 2012.

HSIL and Groupe Atlantic together revolutionizing the market

HSIL in collaboration with Groupe Atlantic brings in the latest and technologically superior

products for advanced thermal comfort.

 

28

Advantages:

o Products with latest technological advancement from Europe’s leading brand in thermal

comfort.

o Superior consumer benefits and safety features:

1. Advanced heating system gives 25% faster heating* and 5 star rated energy efficiency.

2. Patented O’Pro Technology & Titanium coated tank enhances the life of heating element &

tank respectively.

3. Heating element made of superior grade copper – longer life.

4. Diffused entry of cold water gives hot water at consistent temperature and provides superior

bathing experience

5. IP24 superior safety through concealed high quality electrical wiring that ensures protection

against water splash

6. Technologically advanced, superior product ensures longer product life and a longer warranty

o CFC free high density liquid PU foam provides superior insulation, heat retention & compact,

aesthetically appealing design.

o Manufactured in the state-of-the-art plant in Thailand

o Dedicated pan India service network

BUSINESS PROFILE

Current Scenario:

29

HSIL Limited the flagship Company of the Somany Group is the largest Indian manufacturer

of Sanitaryware products with a dominant market share of 40% in this industry.

HSIL Limited products are available across the length and breadth of the country and are

supported by over 1000 direct dealers and 12000 sub dealers & retail outlets.

HSIL Limited pioneered the concept of Vitreous China Sanitaryware in India.

Business Classification: HSIL has 2 divisions

Glass Division: under the brand name AGI GLaspac, the 2nd largest glass containers

manufacturing division with manufacturing facility in Hyderabad and Bhongir (50

kms from Hyderabad).

Building Product Division:

Bathroom Products: vitreous China sanitaryware, Tubs, Whirlpool & airpool,

Multifunctions, Bath accessories, Faucets fittings, seat covers, PVC Cisterns,

Concealed cisterns, Pressure pump, Shower Enclosures, Steam cabins etc.

Home Appliances: Kitchen sinks, Kitchen chimneys, Kitchen hobs & Ovens.

HSIL Limited’s own Sanitaryware Brands: Hindware Italian Collection, Hindware Art,

Hindware, Raasi. In addition to its own brand, the company has also launched the world’s

premium brands Teuco & Keramag in Indian market.

HSIL Limited’s sanitaryware manufacturing facilities are based in Bahadurgarh (Haryana)

and Somanypuram (Andhra Pradesh).

HSIL Limited is the only Indian Company to have its R&D Centre recognized by the

Government of India’s Ministry of Science & Technology for over 3 decades.

HSIL Limited’s installed capacity of 600 tonnes/ year at the time of inception has now

reached 32000 tonnes/ year (2.8 million pieces/ year).

HSIL Limited has introduced more than 250 products in the last 18 months.

30

HSIL Limited has evolved from a Sanitaryware manufacturer to a comprehensive Bathroom

solutions Company and has ambitious plans to continuously expand the basket of product

offerings by introducing new product mix within the extended umbrella of Bathrooms,

Kitchens & Beyond.

Expansion Plans:

The company is targeting a turnover of Rs 1000 crore by 2010 & Rs 2000 crore by 2014 from

the current turnover of Rs 671 crore.

Sanitaryware Division

To increase its sanitaryware portfolio & meet the growing demand for sanitaryware products

HSIL Limited is looking at sizable acquisitions in India as well as overseas market.

Retail: HSIL Limited has identified retail as one of the key focus area of the company. The

company plans to have a 3 tier expansion strategy:

Hindware Lacasa – Brand Experience Centres

Exclusive Hindware Boutiques & Arcades in major towns.

Shop in shops in small cities.

o EVOK: HSIL Limited has floated a separate company Hindware Home Retail Pvt. Ltd

(HHRL) & intends to open 50 large format stores under the brand name of EVOK.

The cumulative investment to fuel the Retail Expansion would be approx 300 crores.

The current capacity of the sanitaryware Bibinagar Plant is 18000 MT and will be increased

to 22000 MT.

A new container glass manufacturing plant has been set up at Bhongir , Andhra Pradesh

which has augmented the production capacity manifold.

.

31

1. HSIL is the first company in the

Building Materials Industry to be

awarded the prestigious ISO 9001,

14001 and OHSAS 18001 certificate

2. It is the first in India to receive

the ISI License, back in 1962

3. Hindware has been recognized as

a Superbrand consecutively for

many years

4. Hindware manufactures 2.7

1. Hindware is famous majorly in India

but around the world, its awareness is

lesser.

2. Intense competition means limited

market share growth

32

million sanitaryware pieces each

year

5. Hindware possesses the most

committed distribution network in

India's building products industry.

1. Hindware should leverage its

brand equity and come up with

brands in new construction

materials category by implementing

Umbrella Branding.

2. It can build up a strong

distribution network to ensure its

presence in all the parts of the

country

3. Global expansion can help boost

business

1. Hindware is facing a tough

competition from regional players in the

market.

2. Competitors are offering lucrative

schemes to distributors so that they

push their products. Hindware should

also look for trade promotion schemes

SWOT ANALYSIS OF HSIL LTD.

STRENGTHS WEAKNESSESS

OPPORTUNITIES THREAT

PROJECT PROCESS AND LEARNING

About Project

33

Mapping Retail reach and Penetration of hindware-atlantic water heater in Delhi & NCR

Market”.

What is Market Penetration?

Market penetration is a measure of the amount of sales or adoption of a product or service

compared to the total theoretical market for that product or service . the amount of sale or

adoption can be an individual company’s sale or industry while the theoretical market can be

the total population or an estimate of total potential consumers for the product.

During my tenure as a summer intern I was assigned the project of “Mapping Retail reach

and Penetration of hindware-atlantic water heater in Delhi & NCR Market”.

So in HSIL Ltd., it was noticed that it is only able to cover some retail outlets which is not

even close to half of the total number of retail outlets present in the market. HSIL ltd is not

able to cover retail shops in each and every area or territory.

The deliverables out of this project are as follows:

1. Find out the problem faced by the dealer in sales and the distribution.

2. Pen down a process by which one can identify coverage Gap, start covering those

retail outlets, way to align distributors and ensure serviceability.

OBJECTIVES:

The project carried out for four main objectives

1. To carried out for market survey for knowing prevailing market condition of water

heater via dealer’s chain.

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2. To find out other company’s appliances that dealers approaching.

3. To analyse the selling techniques of dealers.

4. To evaluate the alternative preferences of dealers.

Area to be covered: Delhi & NCR

METHODOLOGY:

To study and identify the un-tap potential market along with the shortcomings of unable to

reach to the retail sector completely, the methodology is completely based on field work and

qualitative data obtained by interviews of the retail shopkeepers and observing the market

from the perspective of the retail shopkeeper, salesman and distributor by studying the

market.

LIMITATION:

I tried my best to get information and draw out responses required for preparing the project

report and management of organization. Yet there were some problems faced by me these are

as follows:

The Research study is confined to Delhi & Gurgaon only.

The sample size may not be adequately represent the market as a whole.

Some retail shopkeepers are not willing to respond properly.

Unavailability of dealers and busy schedule of dealers was exclusive factor because of

which a lot of time was wasted during data collection.

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OBJECTIVE OF THE STUDY

The objective was to find out the market share of hindware-atlantic water heater

products, advantages, and disadvantages of hindware-atlantic water heater products from

dealers and to find out what problems they are facing with the hindware-atlantic water

heater products so that problems can be resolved to increase the sale.

PICTURE SHOWING THE PRODUCT OF HINDWARE –ATLANTIC WATER

HEATER IN ONE OF THE SHOP

Data collection mode

Primary data

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These are the data that I collect directly from dealers by visited as a customer as well as researcher by asking direct question with them.

I have done some research work through internet and employees of hindware to know more about it.

My research work was mainly descriptive; these methodologies help me to get wide range of information.

Secondary data

I have collected data from Internet like the economic times, Company’s websites, Just dial and Indian info line.

Sale's Analysis of the Water heater in Gurgaon .

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2%

33%

28%

7%5%3%

21%

Sale's Analysis of the Water heater

HINDWAREAROSMITHRECCOLDHAVELSBAJAJCROMPTONOTHERS

PRODUCT PORTFOLIO

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10L Storage water Heater

15L Storage water Heater

25L Storage water Heater

Tank construction

Material: MS. 2 domes and 1 cylinder, welded

front bolted flange

Material: MS. 2 domes and 1 cylinder, welded

front bolted flange

Material: MS. 2 domes and 1 cylinder, welded

front bolted flange

Heating Element

2000 W - Mono 230 V~, 8,3W/cm² of surface load

2500 W - Mono 230 V~, 8,6W/cm² of

surface load

2500 W - Mono 230 V~, 8,3W/cm² of surface

load

Thermostat

Bulb thermostat, single pole single throw.

External temperature setting, Frost free setting

(12 +/- 7 °C) in conformity with IEC 335-

2-21

Bulb thermostat, single pole single throw.

External temperature setting, Frost free

setting (12 +/- 7 °C) in conformity with IEC

335-2-21

Bulb thermostat, single pole single throw.

External temperature setting, Frost free

setting (12 +/- 7 °C) in conformity with IEC

335-2-21

Insulation

Liquid High Density CFC free Polyurethane foam

Liquid High Density CFC free Polyurethane

foam

Liquid High Density CFC free Polyurethane

foam

Temperature setting

(regulation) 65 ± 5 °C 65 ± 5 °C 65 ± 5 °C

FINDINGS

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1. Hindware have good product range of water heater but very few dealers

have hindware products.

I found many reasons through field survey that hindware still facing tough

competition in water heater market due to less awareness of brand, therefore very

few dealers have hindware products.

2. A less of awareness of hindware -atlantic water heater.

A main reason of less sales of hindware- atlantic water heater in the market is less

product awareness, 35% dealers are not aware about hindware atlantic water

heater.

3. Hindware have poor after sale service and complaint handling.

26% dealers given their opinion that hindware have poor after sale service and

complaint handling, it creating bad impression of hindware products.

4. Other company have good margin and service compare then hindware.

Another main reason that I found is other company specially A.O. smith, recold,

havells , v-gurd have good service and margin, this companies are giving benefit

of credit policy to their dealers.

.

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Suggestions And Conclusion

I found conclusion from this market research, but with conclusion I

added some suggestions which may help the company as follows,

1. I found that there is very good market of water heater of

hindware but to keep this momentum hindware should have to

make loyal dealer who can promote this brand.

2. I analysed that water heater market in Gurgaon region can

provide good margin and growth opportunity to the company.

3. A.O.simth, Recold and some of the brands are equally good in

comparison of hindware but because of aggressive promotion

in market they are in good condition in Gurgaon region,

hindware should carry some promotional work.

4. A company should give discount and attractive schemes with

good margin to attract more dealers as well as customers in the

market.

5. A new method to connect customers directly is to visit

residential areas and societies by showing demo of water

heater through mobile van as like mobile ATM of banks.

6. As we know Indian consumers are more conscious about good

quality of product with reasonable price, hindware should

carry some promotional offers in market.

7. Hindware should promote its brand through brand promotion

activities like exhibition, fair, events, sponsorship, CSR

activities to increase its awareness.

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8. Hindware should increase the availability of their products so

that the product can easily be available to the consumer at

every corner of the city.

9. Hindware should carry discount and schemes and credit policy

with a view to satisfy the dealer’s chain.

10. Hindware has to increase its retail outlets via franchises chain

in the market.

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KEY LEARNINGS

Looking back to the day one of my internship, I had no clue how will I be able to get going

but as I reflect the thoughts of what all knowledge I am taking back after this valuable

experience gained in these months, I could say a much more than a lot. Some of the key

learnings are as follows:

Learnt how to do the market as I covered each and every beat of Gurgaon & visited

every retail shop which the distributor covers.

Learnt about the extensive distribution system which the company incorporates.

Learnt more about how consumer durable sector works and the marketing strategies

which the company uses along with how it sets the targets for its salesman and

distributors.

Learnt how to deal with people and the art of personnel selling with the importance of

communication skills and convincing power in the daily market

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REFERENCES

http: www.hindwarehome.com/about

http: www.hindware appliances .com/about

http: www.economiestime.com/

http: www. slideshare.com/

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