Toy manufacturer Funskool India plans to commission a production plant focused on exports in Tamil Nadu during August-September, its CEO, K John Baby said today.
The MRF promoted company currently has two plants -- one at Ranipet in Tamil Nadu and another in Goa.
Baby said the third plant will be located in Tamil Nadu but declined to specify the location citing "strategic reasons", but company sources said it's likely in Ranipet.
Currently, the company ships products made at Goa plant for exports from Mumbai port. Locating the third plant (at Ranipet) near the port city of Chennai would significantly cut logistics costs for the company, sources said.
Baby said the company would adopt a step-by-step approach in terms of investment into the new plant. "Initially we plan to invest Rs 25 to 40 crore in the next financial year".
In 2016-17, Funskool India had a turnover of Rs 220 crore, including Rs 40 crore in exports.
"We will end up this year (2017-18) with a turnover Rs 240 crore, with export component being Rs 50 crore", Baby told PTI.
2017-18 was a "pretty bad and very tough" year for the toy industry in India as it was impacted by "continuing effect" of demonetisation, GST implementation, stricter import norms and hike in customs duty, according to him.
"The worst is behind us (Funskool India). We are targeting a 25 per cent turnover growth in the coming financial year", Baby said. "GST is stabilised. Importing products is more or less streamlined now though the cost of imported products have gone up".
Disclaimer: No Business Standard Journalist was involved in creation of this content
