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VIP Industries had quite a tumultuous period during the COVID-induced lockdown. However, things are back to normal because of travel and marriage season. The company saw very good traction in the second quarter of this year, which is normally the weakest quarter. “This year, the second quarter has also become quite good. So, we are very optimistic about the future,” Piramal said.
“We are now at about 43 per cent, we have gained market share in the current year and, our aim is to now reach at least 45 per cent market share during this fiscal year. I hope we can even get the back to the high 40s the next year,” Piramal said in an exclusive conversation with Udayan Mukherjee, global business editor, Business Today TV.
, Piramal On being asked about reducing said, “After the pandemic, China costs have become very high, our volumes have gone up so much that we are now rationalising all that. We will buy from China only what is barely the cheapest product there. Will buy a lot from India and Bangladesh. Gradually in the next two years, we should be in the optimum input position for input raw material that will save costs considerably.”
Talking about future plans, Piramal said the company plans to enhance its presence in multinational markets step by step. International sales account for less than 10 per cent of total sales. “We cannot obviously buy from somebody else and sell abroad. We have to make it ourselves and procure more in India. We are, I believe, probably among the lowest-cost producers in the world,” he added.
Commenting on the GST regime, Piramal said it had proven to be a great enabler for organised players. It really reduced the level of taxation which was high on all manufactured products and all branded products because there was a large excise duty and the sales tax was also very high. GST subsumed everything at a rate of 18 per cent and the company also got some input credit set off.
On VIP’s next diversification move, Piramal said, all the ladies’ handbags are in the very hot couture, very high segment, selling for thousands of dollars. There is no big brand that is selling, retailing at under 100 dollars and that is a very good space. “I feel, it’s very similar to luggage in manufacturing and even in distribution, and I hope in some time in the next five years, we are able to address that market in a significant manner.”
The company has manufacturing facilities across India and Bangladesh, producing brands such as Aristocrat, VIP, Skybags, Carlton, and Caprese, which target different price points.
