Welspun diversifying brand Sintex, to enter into pipe; aims 5% market share in next 7 years

Welspun Group is diversifying Sintex, a company acquired through insolvency, into segments including pipes, aiming to corner 5% market share of this highly competitive space in the next seven years, said a company official.

The Goenka family-promoted group is now taking brand Sintex beyond its primary plastic water storage tank business to new areas such as pipes and water recycling. It is also working on electrical boxes and has future plans for cable wires for its electrical business.

Welspun is aggressive for Sintex’s growth, where it is investing to expand its capacity, talent acquisition and optimisation, which will enable it to drive long-term growth, said Yashovardhan Agarwal, Managing Director, Welspun BAPL & Director, Sintex.

"So our plan is to get into all the different categories. We are in the storage for water tanks. We are getting into transportation, which is the full range of pipes. We will get into the treatment of water as well," Agarwal told PTI.

The company has already started prototyping for its pipes business and expects to have a nationwide presence in this segment in less than a year, he added.

Welspun will also take Sintex into water recycling, where it will work on reclamation of water, re-harvesting of water, etc.

"We have already announced last year, ₹2,400 crore as investment in capacity, in which ₹300 crore to ₹350 crore has already been invested," said Agarwal, adding the group has inherited five manufacturing locations and has added three to that.

In March 2023, Welspun Group, a leading conglomerate with interests in textiles, steel, line pipes and flooring solutions, acquired Sintex through a corporate insolvency resolution process for ₹1,251 crore.

According to Agarwal, in the water tank business, freight is a "humongous issue," hence, the group is realigning the production capacity.

"All three will be open within the next quarter. We have acquired a company called Weetek Plastics in Raipur for ₹75 crore. We are already tripling its capacity. We have started a plant in Sonipat near Delhi for tanks, and Bhopal, the biggest one right now, is for the full range of pipes," he said.

Besides, capacity expansion and enhancement are planned in a couple of other plants as well, Agarwal added.

Sintex has a business of around ₹600 crore, as Welspun has removed certain parts of the business after the acquisition and is focusing on water storage tanks, where it has around 12% growth in the premium segment.

"So that runway has started coming. In quarter four last year and this quarter, we have big growth," he said, adding, "when we acquired the company, it was in shambles. You have to fix the company inside. You have to bring transparency. Now the results are going to come back."

When asked about growth projections for Sintex, Agarwal said," We are getting into pipes, which has a market size that is 12 times bigger than tanks. Our ambitious target is to have 5% in less than seven years. So the whole ballpark will change."

The Indian pipes market, which is having a 12% growth, expects to reach ₹1.3 lakh crore by FY30.

While in the water storage business, where Sintex operates in the premium segment, the group has plans to make it more affordable, taking it to more economical sections. According to Agarwal, now Sintex is targeting tier II & III cities, which was not done earlier.

"The biggest advantage of Sintex is, we are known even in Tier III cities. So that real brand printing, which has to happen for the majority of India, it's there. That's why we are very bullish about this," he said.

The water storage tank market is estimated to be around ₹6,000 crore, in which Sintex, despite facing all kinds of challenges, has a 10% market share, said Agarwal.

When asked about Sintex's plan for electrical products, where it operates with products such as junction and meter boxes, the company said, "EB portfolio is the fastest growing portfolio in the overall Sintex product basket. We continue to focus on increasing market reach and simultaneously invest in the backend for operational performance improvement."

Besides, Sintex operates in UPVC doors & decorative Panels. It has over 900 distributors across India and is expanding its base.