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Tata International seeks to expand exports footprint, cut Europe dependence |
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Tata International, the global trading and distribution arm of the over-$103 billion Tata Group, has chalked out an aggressive plan to increase revenues from exports in the next 2-3 years. India's largest exporter of footwear registered overall revenues to Rs 900 crore -- from five business verticals – leather and leather products, metals trading, minerals trading, distribution (auto and allied) and agri trading -- in fiscal 2013-14. The management is now working on increasing revenues over 55% to Rs 1,400 crore.
"We are looking at footwear exports of a minimum of 10 million pairs from 6.5 million at present. As far as domestic market is concerned, we are looking to sell at least 1 million pairs," said N Mohan, global business head, footwear and leather garments, Tata International Ltd, said at the launch of women's footwear brand 'Aerosoles' in India.
While TIL currently owns no footwear brands, Mohan confirmed about plans to introduce private labels in the coming years.
"We have registered many brands and are currently working on the unique selling proposition aspect for these brands. There are also plans to launch stand-alone footwear stores to retail the Aerosoles range in a year or two," he said.
The company exports 99% of its products to the European markets and plans to add more geographies. "This year, we will be adding three large corporations for selling footwear in the US market. Other newer markets like Australia and South Africa will be added in addition to Latin American countries like Chile and Brazil," said Mohan, adding that three years down the line approximately 60% revenues will be from exports to Europe followed by 30% in the US and 10% to rest of the markets.
On the margin front, Mohan said that an ex-factory price of say Rs 100 translates into a retail price of Rs 400 in European markets. "The scenario isn't very different in India. An ex-factory price of Rs 100 will translate into a retail price of Rs 300," he said.
TIL is planning a capex of Rs 25-30 crore in the next three years, most of which will go for building capacity and training of workforce. The company currently has associations with major global footwear brands like Kenneth Cole, Florsheim, Lloyd, Hush Puppies, Bugatti, Pepe Jeans, Clarks and leading retailers such as Marks & Spencer, Zara, Massimo Dutti, John Lewis, Aldo and others.
In 2012, TIL announced a strategic alliance with Aerogroup International to produce and market the Aerosoles brand in Europe and India in 2012. While the company has been extensively selling the footwear in Europe, this is the first time Aerosoles will be made available in India. Of the overall export revenues, the Aerosoles business contributes around Rs 170 crore. "The target in the next three years is to increase this number to Rs 300 crore," said Mohan.
Source : dnaindia.com
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