Hintastica Private Limited (“HPL”), the Joint Venture company to target higher market share of the water heater segment by setting up a state of the art manufacturing plant
New Delhi, NFAPost: Group Atlantic, France, a 2.2 billion Euro company with a dominant presence in manufacturing, developing, and distributing eco-friendly heating products and hot water solutions, will invest Rs 68.3 crore for a 50% stake in the water heater business subsidiary of Somany Home Innovation Limited (SHIL), one of India’s leading premium consumer appliances and building products company.
The company Board approved the execution of the share subscription and shareholder’s agreement (“SSHA”) (along with the ancillary agreements) with M/s Atlantic Societe Francaise De Development Thermique, France (“Groupe Atlantic”) and Hintastica Private Limited (“HPL”), which at present is a wholly owned subsidiary Somany Home Innovation Limited (SHIL).
Hintastica Private Limited is setting up a state-of-the-art manufacturing plant in Telangana. The project is in line with the Government of India’s ‘Make in India’ initiative and all components will be made/sourced from within India.
The plant will be built on a plot of 5.7 acres and will be completed by March 2022, with trial runs expected to commence from May 2022. The plant will also help generate employment for over 500 people directly and indirectly in peak season.
Groupe Atlantic, has over 50 years of rich experience in eco-friendly heating and hot water solutions in Europe, the Middle East, Africa, and Asia. It has commercial operations across four continents and 28 industrial sites.
The organisation has 10,000 employees worldwide. It owns 17 brands that are geared towards providing efficient and eco-friendly heating solutions for homes as well as other applications.
Groupe Atlantic produces over 8 million appliances and products every year, including 2.8 million water heaters in its six dedicated manufacturing plants. 4% of Groupe Atlantic’s turnover is committed to the development of new products, a reflection of the organization’s dedication to innovation and R&D.
Marketing and distribution
HPL will leverage Groupe Atlantic’s proven expertise in manufacturing and assembly as well as SHIL’s strengths in marketing and distribution to deliver to the consumer in India and also the neighbouring nations in the SAARC region, a range of high-quality products and accessories all under the brand name ‘Hindware Atlantic.
Sandip Somany, Chairman and Non-Executive Director of SHIL said, this joint venture is in line with its strategy of building leadership positions across pioneering categories.
“The transaction which is value accretive for SHIL is aligned with our objective of being ‘asset right’ and prudently deploying capital to create sustainable value and delight amongst our consumers,” said Sandip Somany.
Sandip Somany said Groupe Atlantic, is a well-renowned name, known for its expertise in the heating solutions segment and its investment in the company is a testament to the fact that it has created value in the water heaters segment in India.
He further added despite the water heater segment being a highly fragmented market, SHIL has succeeded in creating a mark for itself in a short span of time.
“We believe that the JV will not only help us further strengthen our position in this market, but also provide a winning combination, offering consumers a wide range of innovative and exciting products, while enhancing our margins,” said Sandip Somany.
Gilles Romagné, International Managing Director of Groupe Atlantic, said after a fruitful partnership, Groupe Atlantic is delighted to join SHIL in this new venture, to further strengthen the bond between the company.
“Hindware is a brand with a rich legacy and extraordinary expertise in the Indian market. Combined with our experience of 50 years in water heaters and heating solutions, we believe there is a significant opportunity to forge a profitable partnership, fulfilling the needs of the Indian consumers and delivering value,” said Gilles Romagné.
“We will together build a best-in-class facility in Telangana, India for manufacturing and marketing of water heaters to meet the future needs of not only India but also the neighbouring nations in the SAARC region,” said Gilles Romagné.
The water heater market in India is currently pegged at close to 36 lakh units annually, with SHIL commanding a market share of approximately 7.3%. The water heaters market has been growing at an annual rate of CAGR of 10% past four years and is expected to grow at the same rate over the coming years.
Somany Home Innovation Limited (SHIL), vastly recognised by its Brand Hindware, is the fastest-growing player in the Indian Consumer Appliances and a leader in the Building Products segment.
SHIL is focused on servicing end-consumers and involved in branding, marketing, sales & distribution and service of various products categories.
The Consumer Appliances business consists of a selection of household appliances such as kitchen appliances: kitchen chimneys, cooker hoods, built-in hobs, cooktops, built-in ovens, sinks under the brand Hindware Kitchen Ensemble are leaders in numerous categories.
The brand Moonbow by Hindware houses water and air purifiers. The company sells air coolers and ceiling fans under brand Hindware Snowcrest.
SHIL also has strategic marketing tie-ups with some of the most prominent companies such as Groupe Atlantic in the water heaters segment and the Italian company, Formenti & Giovenzana in the furniture and kitchen fittings segment.
Hintastica Private Limited will be a joint venture between SHIL and Groupe Atlantic housing the manufacturing, marketing and distribution of the water heater business under the brand Hindware Atlantic.
SHIL through its wholly-owned subsidiary, Brilloca Limited has a versatile range of best-in-class sanitaryware and faucets products with five brands – Queo, Alchymi, Hindware Italian Collection, Hindware and Benelave catering to a wide pricing spectrum, from luxury and super-premium to mass.
The company has a growing presence in the Plastic pipes and fittings business under the brand ‘Truflo by Hindware’, one of the fastest-growing brands in the country in this segment. Recently, ‘Truflo by Hindware’ has also forayed into overhead water storage tanks and column pipes. Under the brand Neom, Brilloca Limited has presence in the super-premium and premium tiles market.