CHAPTER-1

INTRODUCTION

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 INTRODUCTION

Rumors have it that the first clay tiles were produced seven to eight thousand years ago in
the area now known as the Holy Land. Many sources independently verify that the actual
known history of Tiles, (and the known usage of wall and floor tile coverings) can be
traced back as far as the fourth millennium BC (4000 BC) to Egypt. In those days, in
Egypt, tiles were used to decorate various houses. Clay bricks were dried beneath the sun
or baked, and the first glazes were blue in color and were made from copper, very
exquisite! During that period ceramics were also known to be found in Mesopotamia.
These ceramics bore decorations, which were white and blue striped and later possessed
more varied patterns and colors. Later on, in China too, the great center of ceramic art, a
fine, white stoneware with the earliest Chinese glaze was produced during the Shang-Yin
dynasty (1523-1028 BC).

The usage and the art of making and decorating ceramic tiles had spread and by 900
A.D., decorative tiles had become widely used in Persia, Syria, Turkey and across North
Africa. As transport and communication developed, tile usage and its penetration in other
territories increased. Wars and territory take-overs caused this art to spread even faster.

The Romans introduced tile making in Western Europe as they occupied territories. The
Low Countries of Northern Europe somehow acquired the technology from Persia, while
the Moors brought African tiles with them when they invaded Iberia (Spain). It was
aboard the ships of Spanish conquistadors that decorative clay tiles found their way to the
New World, where they were used primarily to decorate the Churches of newly built
missions.

By the end of the 12th century, use and manufacture of Ceramic Tiles had spread across
Italy and Spain and into the rest of Europe. Till that time they were mainly used to
decorate the floors of Cathedrals and Churches. The skill had eventually vanished from
Europe in the 16th century following the reformation. But the decorative wall tile art had
survived in Turkey and the Middle East and the Delft tiles art survived in Holland. A
form of tile making had also evolved among the natives of North and South America at

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some point. The first decorative tiles to appear in Colonial North America were imported
from Northern Europe, mainly England the Brits having hijacked the technology from the
Dutch. The tiles were too expensive for utilitarian purposes in the Colonies and were
found almost exclusively in the homes of the wealthy. Through the centuries, tile
decoration was improved upon, as were methods of tile manufacture. For example,
during the Islamic period, all methods of tile decoration were brought to perfection in
Persia. Throughout the known world, in various countries and cities, Ceramic tile
production and decoration reached great heights. The tile mosaics of Spain and Portugal,
the floor tiles of Renaissance Italy, the faiences of Antwerp, the development of tile
iconography in the Netherlands, and the Ceramic tiles of Germany are all prominent
landmarks in the history of Ceramic tile. In the early days, the tiles were hand-made, each
tile was hand-formed and hand-painted, thus each was a work of art in its own right.
Ceramic tile was used almost everywhere on walls, floors, ceilings, fireplaces, in murals,
and as an exterior cladding on buildings. Today Ceramic tile throughout the world is not
hand-made or hand-painted for the most part. Automated manufacturing techniques are
used and the human hand does not enter into the picture until it is time to install the tile.
They are used in an almost infinite number of ways and you dont have to consider
yourself wealthy to own them. In commercial buildings, where both beauty and durability
are considerations, ceramic tiles will be found, particularly in lobby areas and restrooms.

In fact most modern houses throughout use Ceramic tiles for their bathrooms and
kitchens and in every vital area of the premise. Ceramic tiles are also the choice of
industry, where walls and floors must resist chemicals. And the Space Shuttle never
leaves Earth without its protective jacket of high-tech, heat resistant tiles. (Note: The
above history has been compiled after taking varied sources of information into
consideration)

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CERAMIC TILES INDUSTRY IN INDIA:

Industry Highlights

Ceramic Tiles today have become an integral part of home improvement. It can
make a huge difference to the way your interiors and outdoors look and express.

The Indian tile industry, despite an overall slowdown of the economy, continues to
grow at a healthy 15% per annum.

Investments in the last 5 years have aggregated over Rs. 2000 crores and production
during 2006-07 stood at approx. 340 million sq mts.

The Indian tile industry is divided into organized and unorganized sector.

The organized sector comprises of approximately 16 players. The current size of the
unorganized sector is about Rs 3000 crores

The unorganized sector accounts for 55% of the total industry bearing testimony of
the attractive returns from this sector. The size of the unorganized sector is
approximately Rs 3500 crores

Revenue earning industry - excise mops up over Rs. 350 crores annually from the
organized sector itself.

Indian ranks in the top 5 list of countries in terms of tile production in the world.

With proper planning and better quality control our exports (presently insignificant)
contribution can significantly increase.

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Background

Apart from their decorative looks, Ceramic Tiles are primarily hygiene products and that
is how our broad spectrum of consumers view the product. This is fairly evident from its
varied usage from bathrooms and kitchens in average Indian households to medical
centers, labs, milk booths, schools, public conveniences, shopping malls and numerous
other centers; which dot our day to day life. A ceramic tile is basically a "utility product"
and that remains our promotional slogan. Popular housing projects are increasingly
switching over to Ceramic Tiles moving away from the traditional use mosaic and even
granite or marble, owing to several factors viz. ease in laying ability, versatility, low price
and hygiene.

Nevertheless, this decorative aspect of a Ceramic Tiles has forever been in the forefront.
Heavy churning out of bolder and colorful designs by the industry are testament to the
fact that most households regard a ceramic tile as an "adornment" for an otherwise "drab
look" of their age-old floorings or an unfurnished wall.

Overall picture of the Industry

Ceramic tiles as a product segment has grown to a sizeable chunk today at 340 Millions
Square meters production per annum. However, the potential seems to be great,
particularly as the housing sector, retail, IT & BPO sectors have been witnessing an
unprecedented boom in recent times. The ceramic tiles sector has been clocking a robust
growth of 12-15% consistently over the last few years. Today, India figures in the top 5
countries in the world manufacturing ceramic tiles. The key drivers for the ceramic tiles
in India are the boom in housing sector coupled by government policies fuelling strong
growth in housing sector. The retail boom in the Indian economy has also influenced the
demand for higher end products. Overall the bullish growth estimates in the Indian
economy has significantly influenced the growth of the Indian Ceramic tile industry. The
main product segments are the Wall tile, Floor tile, Vitrified tile and Porcelain tile
segments. The market shares are 35%, 53% and 12% respectively for Wall, Floor &
Vitrified/Porcelain tiles. The tiles are available in a wide variety of designs, textures and

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surface effects. They cater to tastes as varied from rustics to contemporary marble
designs in super glossy mirror finishes.

Both, traditional methods of manufacturing (tunnel ) and the latest single fast firing
methods are deployed in manufacturing. Some of the latest trends in manufacturing
methods can be seen in India.

The investments in the last five years are approx. Rs 2000 crores. The industry also
enjoys the unique distinction of being highly indigenous with an abundance of raw
materials, technical skills, infrastructural facilities despite being fairly capital intensive. A
total of over 5,50,000 people are employed in the sector. Out of this, 50,000 people are
directly employed and 5,00,000 are indirectly associated. The potential is huge
considering the per capita consumption of ceramic tiles in India. Currently it is at 0.30
square meters per person in comparison to over 2 square meters per person for like
countries like China, Brazil and Malaysia

Where we stand and what we must do?

As a foreign exchange earner or a global player, Indian Tile industry has captured the
attention of the world in the ceramic tiles segment. India is projected to figure in the top 3
countries manufacturing ceramic tiles by 2010. This however is subject to policies
favorable for the tile industry to complete with international players on an even ground.

To compete internationally, our plants must be geared up to large units currently

operating in China and Turkey are driven by economies of scale. These will also help us
in lowering our cost of production significantly. Also, infrastructural support is a key
factor that determines the speed of growth. Better infrastructure will bring in better
growth in terms of consistency and sustenance. Freight, supply of power and gas remains
the key cost-related issues impacting the industry. Availability, consistent supply and
reasonable rates are extremely important for the growth of the ceramic tile industry. Also,
the prevailing anomalies pertaining to Basic Customs Duty on import of ceramic tiles
from China and raw materials imported from abroad need to be corrected to prevent

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dumping of tiles from China. Rural thrust should be enhanced by favorable excise duty
and MRP structure

Current status of the Industry

The ceramic tiles industry in India has followed similar trends internationally which have
been characterized by excess capacities and falling margins. Countries like Malaysia,
Thailand, Indonesia, Sri Lanka and Vietnam are setting up their own plants. China has
emerged as a major competitor. Producers from Spain and Italy have the advantage of
lower transportation costs while exporting to USA and Germany. In India, the per capita
consumption is as low as 0.30 square meters per person compared to China (2 square
meters per person), Europe (5 to 6 square meters per person) or Brazil (2.5 square meters
per person). Rising disposable incomes of the growing middle class and 40 million units
of housing shortage hold out a great potential. A major change that took over the ceramic
tiles industry, was the introduction of vitrified and porcelain tiles. These new entrant
product types are said to be the tiles of the future. Internationally these tiles are already
the major sellers. These category of products account for 13% of all organized sales in
this industry.

These new products and the conventional wall & floor tiles have together made the
organized industry grow to a formidable Rs. 3000 crores industry. This coupled with a
spate of expansions by many players make the industry look very promising in the future.

The Indian Industry has developed an export market although at the lower end. In volume
it constitutes less than half a percent of the global market. (Presently India does not figure
in the list of major exporting countries). But this reality could change as Indian exports
are rising at the rate of 15% per annum. The top-end of the global export market is
presently dominated by Italy (40.8%) and Spain (26.4%). (Source: Compiled using
information from Corporate Catalyst India, ASCER and other associations.)

CERAMIC TILE INDUSTRY STATISTICS:

1. World production: 6900 Million sq.mt.

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2. India's Share: 340 Million sq.mt..

3. World ranking (in production): 5

4. Per capita consumption: 0.30 sq.mt.

5. Global Industry Growth Rate: 6%

6. Growth Rate (India Domestic Market): 15%

7. Organized industry turnover (India): Rs 3000 crores Glazed Wall Tile share: 40%
Glazed Floor Tile share: 46% Unglazed Vitrified Tile share: 8% Glazed Porcelain
Tile Share: 6% Unorganised Industry Turnover Rs 3500 crores Glazed Wall Tile
share: 57% Glazed Floor Tile share: 35% Unglazed Vitrified Tile share: 6%
Glazed Porcelain Tile Share: 2%

8. Investments in last 5 years: Rs 2000 crores

9. Organized sector: Share of Production: 56% No. of units: 16 Revenue

(excise duty): Rs 300 crores

10. Unorganized sector: Share of Production: 44% No. of units: 200 (approx..)
(70% based in Gujarat region) Revenue (excise duty): Rs 350 crores per annum or less

11. Job Potential: 50,000 direct 500,000 indirect

Two levels of marketing

Strategic marketing: attempts to determine how an organization competes against its

competitors in a market place. In particular, it aims at generating a competitive advantage
relative to its competitors. Operational marketing: executes marketing functions to attract
and keep customers and to maximize the value derived for them, as well as to satisfy the
customer with prompt services and meeting the customer expectations. Operational
Marketing includes the determination of the porter's five forces

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4 Ps

In the early 1960s, Professor Neil Borden at Harvard Business School identified a
number of Birla Cement performance actions that can influence the consumer decision to
purchase goods or services. Borden suggested that all those actions of the Birla Cement
represented a “Marketing Mix”. Professor E. Jerome McCarthy, also at the Harvard
Business School in the early 1960s, suggested that the Marketing Mix contained 4
elements: product, price, place and promotion. In popular usage, "marketing" is the
promotion of products, especially advertising and branding. However, in professional
usage the term has a wider meaning which recognizes that marketing is customer-
centered. Products are often developed to meet the desires of groups of customers or
even, in some cases, for specific customers. E. Jerome McCarthy divided marketing into
four general sets of activities. His typology has become so universally recognized that his
four activity sets, the Four Ps, have passed into the language.

Product: The product aspects of marketing deal with the specifications of the actual
goods or services, and how it relates to the end-user's needs and wants. The scope of a
product generally includes supporting elements such as warranties, guarantees, and
support.

Pricing: This refers to the process of setting a price for a product, including discounts.
The price need not be monetary - it can simply be what is exchanged for the product or
services, e.g. time, energy, psychology or attention.

Promotion: This includes advertising, sales promotion, publicity, and personal selling,
branding and refers to the various methods of promoting the product, brand, or Birla
Cement.

Placement (or distribution): refers to how the product gets to the customer; for
example, point of sale placement or retailing. This fourth P has also sometimes been
called Place, referring to the channel by which a product or services is sold (e.g. online
vs. retail), which geographic region or industry, to which segment (young adults,
families, business people), etc. also referring to how the environment in which the

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product is sold in can affect sales. These four elements are often referred to as the
marketing mix, which a marketer can use to craft a marketing plan. The four Ps model is
most useful when marketing low value consumer products. Industrial products, services,
high value consumer products require adjustments to this model. Services marketing must
account for the unique nature of services. Industrial or B2B marketing must account for
the long term contractual agreements that are typical in supply chain transactions.
Relationship marketing attempts to do this by looking at marketing from a long term
relationship perspective rather than individual transactions.

As a counter to this, Morgan, in Riding the Waves of Change (Jossey-Bass, 1988),

suggests that one of the greatest limitations of the 4 Ps approach "is that it unconsciously
emphasizes the inside–out view (looking from the Birla Cement outwards), whereas the
essence of marketing should be the outside–in approach". Nevertheless, the 4 Ps offer a
memorable and workable guide to the major categories of marketing activity, as well as a
framework within which these can be used.

7 P’s

As well as the standard four P's (Product, Pricing, Promotion and Place), services
marketing calls upon an extra three, totaling seven and known together as the extended
marketing mix. These are:

People: Any person coming into contact with customers can have an impact on overall
satisfaction. Whether as part of a supporting service to a product or involved in a total
service, people are particularly important because, in the customer's eyes, they are
generally inseparable from the total service . As a result of this, they must be
appropriately trained, well motivated and the right type of person. Fellow customers are
also sometimes referred to under 'people', as they too can affect the customer's service
experience, (e.g., at a sporting event).

Process: This is the process(es) involved in providing a service and the behaviour of
people, which can be crucial to customer satisfaction.

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Physical evidence: Unlike a product, a service cannot be experienced before it is
delivered, which makes it intangible. This, therefore, means that potential customers
could perceive greater risk when deciding whether to use a service. To reduce the feeling
of risk, thus improving the chance for success, it is often vital to offer potential customers
the chance to see what a service would be like. This is done by providing physical
evidence, such as case studies, testimonials or demonstrations.

Personalization: It is here referred customization of products and services through the

use of the Internet. Early examples include Dell on-line and Amazon.com, but this
concept is further extended with emerging social media and advanced algorithms.
Emerging technologies will continue to push this idea forward.

Participation: This is to allow the customer to participate in what the brand should stand
for; what should be the product directions and even which ads to run. This concept is
laying the foundation for disruptive change through democratization of information.

Peer-to-Peer: This refers to customer networks and communities where advocacy

happens. The historical problem with marketing is that it is “interruptive” in nature,
trying to impose a brand on the customer. This is most apparent in TV advertising. These
“passive customer bases” will ultimately be replaced by the “active customer
communities”. Brand engagement happens within those conversations. P2P is now being
referred as Social Computing and is likely to be the most disruptive force in the future of
marketing.

Predictive modeling: This refers to algorithms that are being successfully applied in
marketing problems (both a regression as well as a classification problem).

Product

Steps in product design

 Design and development of product ideas.

 Selection of and sifting through product ideas.

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 Design and testing of product concept.

 Analysis of business instead of product concept.

 Design and testing of emotional product.

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Packaging

 Requirements of good packaging

 Functional - effectively contain and protect the contents

 Provide convenience during distribution, sale, opening, use, reuse, etc.

 Be environmentally responsible

 Be cost effective

 Appropriately designed for target market

 Eye-catching (particularly for retail/consumer sales)

 Communicate attributes and recommended use of the product and package

 Compliant with retailers' requirements

 Promotes image of enterprise

 Distinguishable from competitors' products

 Meet legal requirements for product and packaging

 Point of difference in service and supply of product.

 For a perfect product, perfect colour.

Forms of packaging

 Specialty packaging — emphasizes the elegant character of the product

 Packaging for double-use

 Combination packaging two or more products packaged in the same container

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  Kaleidoscopic packaging — packaging changes continually to reflect a series or
particular theme

 Packaging for immediate consumption — to be thrown away after use

 Packaging for resale — packed, into appropriate quantities, for the retailer or
wholesaler

Trademarks

 Significance of a trademark

 Distinguishes one Birla Cement 's goods from those of another

 Serves as advertisement for quality

 Protects both consumers and manufacturers

 Used in displays and advertising campaigns

 Used to market new products

Brands

A brand is a name, term, design, symbol, or other feature that distinguishes products and
services from competitive offerings. A brand represents the consumers' experience with
an organization, product, or service. A brand has also been defined as an identifiable
entity that makes a specific promise of value. Co-branding involves marketing activity
involving two or more products

Marketing communications

Marketing communications breaks down the strategies involved with marketing messages
into categories based on the goals of each message. There are distinct stages in converting
strangers to customers that govern the communication medium that should be used.

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Oral presentation given by a salesman who approaches individuals or a group of potential
customers:

 Live, interactive relationship

 Personal interest

 Attention and response

 Interesting presentation

 Sales promotion

 Short-term incentives to encourage buying of products:

An example of this is coupons or a sale. People are given an incentive to buy, but it does
not build customer loyalty, nor encourage repeat buys in the future. A major drawback of
sales promotion is that it is easily copied by competition. It cannot be used as a
sustainable source of differentiation.

 Marketing Public Relations (MPR)

 Stimulation of demand through press release giving a favourable report to

a product

 Higher degree of credibility

 Effectively news

 Boosts enterprise's image

 Customer focus

Many companies today have a customer focus (or customer orientation). This implies that
the Birla Cement focuses its activities and products on consumer demands. Generally
there are three ways of doing this: the customer-driven approach, the sense of identifying
market changes and the product innovation approach. In the consumer-driven approach,

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consumer wants are the drivers of all strategic marketing decisions. No strategy is
pursued until it passes the test of consumer research. Every aspect of a market offering,
including the nature of the product itself, is driven by the needs of potential consumers.
The starting point is always the consumer. The rationale for this approach is that there is
no point spending R&D funds developing products that people will not buy. History
attests to many products that were commercial failures in spite of being technological
breakthroughs.

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OBJECTIVES OF THE STUDY

To study marketing as a Generic Promotional Tool:

1. The objective of this study is to understand the concept of event marketing, its
benefits and implementation process.

2. To evaluate the effectiveness of Kajaria Ceramics as a promotional tool.

3. To identify the problems associated with Kajaria Ceramics in the Indian scenario.

4. To offer suggestions for improvement to make it a more productive investment.

Also to study Marketing Strategy for organizing and managing the event in best
way:

1. The objective of this study is to understand the Marketing Strategy as a

communication tool.

2. Launching a product or a service.

3. Communicate to a particular target audience.

4. To make proper strategy , plan and execution of an event

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Literature Review

The tile industry is about a century old in India. About 12,000 persons are directly
employed in this industry and the indirect employment is estimated to be 3000. 36 The
main centres of tile industry are, Calicut, Feroke, Trichur, Ollur, Pudukad, Chalakudy,
Alwaye and Quilon together accounting for 85 per cent of the tile factories in capacity is
100 crore the tiles 37 state. The per annum installed currently producing 55 crore tile
per annum valued at about Rs 60 crores. Seventy per cent of the products were sold
outside the state till the middle of 1960s, main markets being Tamil Nadu, Anohra
Pradesh, Gujarat, Rajasthan, Orissa and Maharashtra.

India was enjoying a dominant position in tile production in the country for a century.
The demand for India tiles was steadily increasing till 1965 both in the local and external
markets. The number of tile factories also doubled in early 1960s as natural clay,
firewood and unskilled labour were easily available. But the situation changed since
1965. Development of tile factoriees in other states like Tamil Nadu, Karnataka, Andhra
Pradesh and Gujarat reduced India's external trade. Preference for RCC type houses
crippled internal markets also. Scarcity of good clay, stiff resistance from
environmentalists towards clay mining, scarcity and high price of firewood and other
inputs and increase in the cost of labour adversely affected the tile industry and the
majority of the factories are on the brink of sickness

The tile industry in India is a traditional one and due to various reasons like availability of
quality clay, firewood etc. it has certain regional concentration. The basic organizational
structure also differs from p 1 ace top 1 ace. Fur the r , the un its vary in the i r
production capacity quality of tiles and also. The type of control, the unit to unit. cost
Therefore, of production also differ from it was f e 1 t t hat a s t rat i f i ed analysis will be
more appropriate based on location and size

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The men and machinery of a factory are related to its size. The Small Industries Service
Institute, Trichur classified the industry according to its size in 1981 as follows. 39

Category A: Those un its producing less than 7500 tiles per day come under this
category and their share in the total factories in the state is worked out to be 76 per
cent.

Category B: units producing between 7500-20,000 tiles per day are included in this
group, percentage share being 21.

Category C: Un its producing more than 20,000 t i 1 es per day come under this group (l
pC'r cellt)

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 RESEARCH METHODOLOGY

Research Design

i. This project is not have any probability

ii. It is non probability based project a nd it is simply calculated from the

differential based technique.

iii. Exploratory research will be taken for this project work

Sampling Methodology

Sample Design

Sampling is the process of collecting information only from a small representative part of
the population. Stratified Random Sampling is one amongst the most elementary random
sampling techniques. A stratified random sampling is a method that allows each possible
sample to have an equal probability of being picked and each item or individual in the
entire population have an equal chance of being included in the sample. For this project
work, without replacement sampling method is used. It means that a person or item once
selected is not returned to the frame and therefore cannot be selected again. This selection
process continues until the desired sample size ‘n’ is obtained.

i. Sampling chosen with the Random method

ii. Sampling Area would be Delhi & NCR and near area only

iii. Sample Size: 100

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 LIMITATION OF THE STUDY

 This is stick with the one organization report and may be due to of very
busy schedule of work employee many not take very appropriate decision
when time of filling the questionnaire

 Also for future events disclosure company are not sharing more internal
information either on internet or ready to give.

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 CHAPTER-2

COMPANY PROFILE

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 COMPANY PROFILE

India being one of the largest domestic market and an emerging Global center is very
well positioned to take the mantle of a Global manufacturing base. Kajaria Ceramics Ltd
has played its own role in achieving this goal. Since our founding in mid 1988, we have
been moving forward aggressively on many fronts to capitalize on solid growth
opportunities, to improve our operating efficiency and to sharpen our business portfolio's
focus. Today, as a result of our internal growth initiatives and several strategic and
innovative initiatives, our business has grown many folds. We have started with one mn
sq mtr capacity in 1988. Today the aggregate capacity of the Company is 26.4 mn sq mtr
distributed across two plants

The Ceramic Tile industry is performing well because of good growth in housing due to a
number of factors like rising income of middle class, easy access of finance and income
tax benefits for housing to builders and individuals.

The Company is expecting a high growth and larger consumer satisfaction in the years to
come. Over the coming years, we expect to explore organic and inorganic opportunities
in pursuit of our goal to report an attractive turnover increase in every single year and our
vision of reporting revenues of Rs 1000 crore by 2009-10.

Over the years, Kajaria has become synonymous with innovation. New techniques are
diligently applied to create tiles that stand apart and speak the language of your soul.
Hence every year, we come up with exciting new concepts that voice new emotions and
keep up with current trends. It is a continuous process, which allows us to express
through tiles what words can't say and provide our consumers with new and innovative
options. The new range of tiles released this year adds to the already impressive Kajaria
Collection.

Reason for the review: We had recommended a ‘Hold’ on Kajaria Ceramics in March
2006 at Rs 40 with as target price of Rs 54 from an FY08 perspective. Since then,
however, the stock has already breached our target price. At the current juncture, with the
planned capacity expansion of 8.4 m sq m already completed and the company beginning

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commercial production from the same (though the full benefit of this expansion will be
visible only by 1QFY08), we have a greater visibility with respect to the next 2-3 years.
The company has indicated of a further 13.6 m sq m expansion, which will take its total
ceramic tile manufacturing capacity to 40 m sq m. However, this expansion is still in the
planning stage and we have not factored it entirely in our projections. What we have,
however, factored is a 3.6 m sq m rise in capacity which the company will ‘have to
undertake’ in the next 12-15 months considering the kind of demand that is expected and
the full utilisation of the current capacity of 26.4 m sq m. As such, we re-iterate a ‘Hold’
on the stock with an FY09 perspective. Higher than expected addition of 3.6 m sq m to
the existing capacity by FY09 will provide an upside to our estimates. Investment
Rationale

􀂃 No stopping the demand: Ceramic tile demand continues to witness strong growth led
by increasing housing activity in the country. As per the CMIE, the rapid growth in
housing loan disbursals has continued unabated this fiscal despite the restrictive actions
taken by the RBI to curb lending. During the past five years, housing credit has grown at
a compounded rate of over 40% (see chart) and we expect it to grow at around 20% per
annum over the next three years. This is indicative of a strong growth in housing demand,
which will consequently benefit the ceramic tile industry. Companies with wider reach
and catering to requirements across segments (high, medium and low range) are likely to
be the biggest beneficiaries of growth. While we understand that the addressable market
size for Kajaria (in term of dwelling units) is largely restricted to urban housing
development, in our view, expansion in organised retailing and hospitality sectors are also
major growth drivers over the next five years. Also, increased foreign participation in the
Indian real estate industry is likely to open up new growth avenues. We estimate Kajaria’s
revenues to grow at a compounded rate of 23% during the period FY06 to FY09 (18%
CAGR during FY03-FY06), led by better utilisation of both existing as well as enhanced
capacities as demand for ceramic tiles is likely to remain strong.

Net profit margins Also, exports, which currently contribute to around 8.7% of the
company’s total revenues, are expected to grow at a compounded rate of 35% during this
period, thus aiding the overall growth for the company. Changing demand mix: The share

23
of mosaic tiles, which currently stands at 70% of the total tile demand, is on a decline in
favour of ceramic and vitrified tiles. We expect the trend to continue going forward. This
is on the back of contraction in price differentials between mosaic and ceramic tiles,
mainly due to excise hike for the former and reduction for the latter. As a matter of fact,
in the Union Budget for 2006-07, excise duty on mosaic tiles was raised from 8% to 16%.
The Budget also proposed withdrawing excise exemptions on ceramic and vitrified tiles
manufactured without the aid of power, thus yielding a blow to small players in the
unorganised sector. We believe that this is a positive for larger players like Kajaria. As far
as the vitrified tile segment is concerned, although Kajaria does not have a direct
presence here, it trades in the same by importing the product from China. The
management has indicated that it has no future plans to enter the manufacturing of
vitrified tiles. Kajaria’s vitrified tiles are priced at Rs 40-100 per sq ft, compared to
ceramic tile realisations of Rs 16-40 per sq ft. Though vitrified tiles are expected to grow
faster, in our view, we do not see any major threat to ceramic tile demand, as the
application and availability (in terms of quantity and designs) of the latter is higher than
the former.

 Expanding to meet demand: In order to meet the high growth in demand for
ceramic tiles from the housing, ITES, retailing and hospitality industries, Kajaria
has been on an expansion spree. In September 2006, the company’s new capacity
of 8.4 m sq m began commercial production (the full benefits of this expansion
will be visible in 1QFY08. This took the company’s total ceramic tile
manufacturing capacity to 26.4 m sq m, second largest in the industry. While the
management is still in discussion for the further planned expansion to 40 m sq m,
we have based our estimated for FY09 on an expanded capacity of 30 m sq m.
This we have assumed considering the strong growth in demand for ceramic tiles
and full utilisation of the company’s existing capacity, thus leaving no room for
growth but on the back of an expansion. Typically, it takes around one year for an
expanded capacity to fully reflect at the topline level and we have maintained this
trend going forward for Kajaria. The company contributes to around 27% of

24
 India’s ceramic tile exports and this helps it to maintain a mix between
international and local sales through effective capacity utilisation (exports are not
as profitable as domestic sales). Though inventory is expected to increase in the
initial phase of expansion, we believe that the enhanced capacity will add to the
topline growth over the next three years.

 Better pricing power: Despite being in an expansionary phase, Kajaria has not let
a big dent occur on its profitability. Even the marginal decline in operating
margins during 1HFY07 has been largely due to higher purchase of trading
goods. This is because the expanded capacity has not achieved full utilisation
(expected to achieve this by 1QFY08) and consequently the company has had to
resort to external purchases to meet growth in demand. All the other cost heads,
like those on raw materials, staff and power & fuel, have in fact witnessed
declines (as percentage of sales) during the first half of this fiscal. Going forward,
while we expect some kind of pressure on the company’s EBIDTA margins, it
will still have better profitability levels than its peers like Nitco Tiles and Bell
Ceramics owing to its brand strength and better product mix. This would provide
it with better pricing power considering that industry wide capacity (and
consequently, supply) is expected to increase rapidly over the next few years.

 Strong distribution network: Kajaria boasts of a large network of 600 dealers

across the country. It has also set up a distribution subsidiary – Kajaria Plus – to
further strengthen its retail marketing. A large distribution network is of great
importance for commodities like 15 November 2006 Kajaria Ceramics Limited
Page 3 of 6 ceramic tiles

 Competing on price: Demand for ceramic tiles is highly elastic to the change in
prices, as most of the end users of the product are price conscious and there is an
easy shift of preference across brands. Besides, with imports from China and
other nations growing at a faster clip, prices are likely to remain under pressure in
the future. Though we have factored in stable gross realisations for Kajaria over
the next 2-3 years, mainly on the back of its brand strength and a wide product

25
 basket, any adverse situation on the demand and supply fronts could pressurise
realisations and consequently the margins.

 Inverted duty structure: The Indian ceramic tile industry suffers from an inverted
duty structure. While domestic manufacturers pay 15% duty on imports of raw
material, the manufactured product (vitrified tiles) can be imported from China at
a less than half duty of 6.45%. This has led to a sort of dumping from the Chinese
tile manufacturers into the Indian market, consequently leading to price erosion
for domestic companies. While large players like Kajaria have a pricing power on
the back of their brand strength and diversified product profile, with the
anticipated strong growth in supply in the market (most of the manufacturers are
ramping up capacities), prices are likely to come under pressure going forward.

 Growth evils: Kajaria is ramping up its ceramic tile manufacturing capacity to

cater to the expected high demand from housing and construction industry. While
this is a positive, we are concerned about the pressure that this ramp up might put
on the company’s balance sheet. The company has a debt to equity ratio of 1.5,
which we expect to reduce gradually to 1.2 by FY08. However, this is assuming
an expansion of only 3.6 m sq m in the next two years. If the company plans to
ramp up capacity at a faster clip than estimated, there might be an undue pressure
on its balance sheet. The company is also contemplating a foreign equity issue
for funding its expansion requirements.

Innovations

"We are the only Indian tile company to have a JV with an European company, H&R
Johnson, International, UK," Aggarwal tells us. "We have introduced the concept of joint-
free tiling in this country. We introduced anti-slip bathroom floor tiles and unique heavy-
duty, anti-staining kitchen floor tiles. We provide the same design and size for both wall
and floor tiles, Recently, we have launched the largest square wall tile in the worid - size
3 15 mm x 315 mm. Also, our House of Johnson display centres allow the entire range to
be showcased, which is otherwise not possible in a dealer's showroom due to space
constraints."

26
Kajaria, too, has such 'experience centres', which showcase products and concepts. "It is
an expression of our consumer-driven approach," says Mishra, "Architects and designers
browse here for hours and we also hold launches and meets here." In terms of innovation,
"we were the first to launch Monoporosa single fire tiles in India," Mishra adds. "We also
provide floor and wall tiles in the same format and design. Also noteworthy are our
Group 5 tiles; which are heavy duty and can take high abrasion, and are ideal for high
traffic areas."

"Nitco regularly introduces innovative high quality products in the market, which often
represent

"Bell's prominent projects include Osho Ashram, Pune, Kangaroo Kids school campus,
Baroda, Saint Xavier's School, Ahmedabad, Indraprastha Towers, a first, like the super
glossy series and the structured, rustic series; the dirt-free tile, etc," says Matey. "We aim
at projecting the tile as a fashion statement rather than as a mere commodity."

Quality prod.

"Bisazza's design studios in India and abroad support new design and application
development on a continuous basis," says Ramlal. "Our glass mosaic is manufactured in
gas fired furnaces for high tonal quality and special metallic salts and oxides are used for
achieving vibrant and non-fading colours.The Le Gemme series has a special metallic
lustre; Gloss has a pearly iridescence; and Smalto has vibrant streaks of colours in
transparent glass."

Indian snapshot

"During the last financial year, the organised sector of the Indian tile industry achieved a
turnover of Rs 2,200 crore," says Aggarwal. "The stiff freight rates and the wide disparity
in demands have made survival difficult for smaller players in the organised sector. This
has led to emergence of only few major players in the organised sector, capable of
catering to demands of all areas supported by their manufacturing units at different
locations. Also overcapacity, sluggish economy and global recession, low profit margin
and lack of economic size have forced a number of small players to put down their

27
shutters in the last few years." As far as consolidation is concerned, H&R Johnson has
acquired the tile plant at Karaikal (in Pondicherry) from EID Parry and Sun Ceramics has
taken over Madhusudan Industry's tile unit. "In future, these consolidations are likely to
increase," Aggarwal predicts.

The unorganised sector seems to be a keen source of concern for major players. "Fifty per
cent of the industry is dominated by the unorganised sector," says Mishra. "The
unorganised sector and cheap imports are the problems," echoes Matey.

"The major problems are the non-availability of cheap fuels which constitutes a major
percentage of the costs," says Ramlal. "Besides, factors like level playing fields with
respect to taxation count. Also, the ethical aspect of business is becoming more relevant
these days when many cheap imitations, trademark infringements, and tax evasions put
pressure on the organised sector."

Import threat!

In many new retail and commercial projects, builders and architects are still opting for
imported tiles. Is this a serious problem and how can it be countered? "The influx of
Chinese tiles with dubious quality is thankfully a thing of the past, thanks - to the anti-
dumping duty, "says Shah. "The Indian companies were little late on the bandwagon in
terms of £ quality but now the top % companies are on a = par with international
standards. Of course, the imported craze does remain. But major builders and architects
are not worried whether it is imported or Indian as long as it matches the look they want.
Ultimately, a tile is a tile! It is more about perception than an actual difference in
quality.".

28
THE GLOBAL SCENARIO

Italy has a turnover of more than Rs.40,000 crore from ceramic tiles alone and along with
Spain and Portugal it dominates the tile industry. But of late, these global leaders have
switched over to granite tiles, making China (with a 30 percent share) the market leader
in the ceramic tiles segment for the global tile production is consumed by Europe while
Asia consumed by Europe while Asia consume only 13 percent. Nearly 70 percent of the
global tile exports originate from Italy and Spain. However, India, with a meagre I
percent share, is a marginal player. As compared to European, where the per capita
consumption of ceramic tiles is 6 sq. mts p.a, India’s is a poor 0.05 sq. mts. Thus, there is
an enormous growth potential for the industry.

A CLASSIC TURNAROUND STORY

The pioneer of the Indian tile industry, Johnson set up the country’s first tile plant in
1958. Incidentally, Johnson international, UK, one of the top five ceramic tile companies
in the world, has a 23 percent equity holding in H&R Johnson (India) Ltd. But until
recently, it manufactured only premium brand white body wall and floor tiles. This
complacent business style, coupled with failure to keep pace with the rapidly changing
market trend, has led to many late entrants defying the monopoly of Johnson. The
situation came to such a pass that the market pundits predicted the doom of the Goliath.

However, in 1993, the Rajan Raheja Group took over the company and immediately
pumped in Rs.240 crore. It also launched innovative designs and patterns in tune with the
changing customer preferences. Sources at Johnson claim that their state-of-the-art plant
at pen in Maharashtra is technologically the most modern plants in the world.

The company now has a fully Computerised Design Studio to impart the aesthetic effects
of light, space and colour to its tiles. In line with its commitment toward customer
satisfaction, it has also set up a customer care cell at its corporate office in Santacruz,
Mumbai.

CHANGING FORTUNES

29
The industry had registered had registered a steady 15 percent growth from 1992 to 1997.
however, it is now bogged by overcapacity due to reckless capacity additions by the
leading players. Johnson has manufacturing facilities at Thane, Dewas, Kunigal and Pen,
with a total production capacity of 16 million sq. m.p.a. With the recent expansion of its
Bhiwadi plant, KCL has ahuge capacity of 1,50,000 TPA. Sunerth’s 39 crore floor tile
plant at Karjat has a capacity of 5,000 sq. mts per day.

Murudeshwar’s Hubli plant has a capacity of 75,000 t.p.a Add to this Orient’s 4.5 million
sq.mt.p.a. Sikan-darabad unit and Bell’s plants at Bharuch and Hoskote, and the capacity
exceeds the demand by 45 percent! In this scenario, the acquisition by Johnson of EID
Parry’s wall-tile plant at Karaikal in Pondicherry for Rs.30 crore and Sunearth’s takeover
of the Bharuch wall-tile plant of Madhusudhan Ceramics for Rs.41 crore has
compounded the woes of the industry.

For the tile industry wrought with overcapacity, declining demand and reduced margins,
the last three years were testing times.

No wonder, CRISIL downgraded the ratings of BELL and SPL recently. The artificial real
estate boom has proved to be the tile and ceramics industry’s undoing. All the players are
now paying a heavy price for their reckless of the market has resulted in a heavy
inventory pile-up for most of the players. A cut in the production will lead to under
absorption of overheads, while excess production may not find takers in the market at the
existing prices.

Thought the exports are not as lucrative as domestic sales, there is no other viable
alternative to the companies in this sector to survive the recession. Johnson exports its
tiles to USA, UK Japan and Spain, but exports account for for only 3 percent of its
turnover. Kajaria on the other hand, is the largest exporter in the industry, and as a result,
the only company operating at more than 100 percent capacity. A low installed capacity
on the part of all the players could generate optimal operational efficiencies and improve
their margins considerably.

30
EXCESSIVE EXCISE

While the excise duty on sanitaryware and vitrified tiles is just 16 percent, ceramic tiles
attract a high duty of 24 percent. In fact, it was an exorbitant 55 percent till 1998. In this
scenario, the Chelliah Committee’s recommendation of 10 percent duty does not seem a
near reality. The high excise duty on ceramic tiles indicates that the government views it
as a luxury item.

Thanks to the steep tariff differentials among the various till segments, the segment with
more than 75 percent share, while the ceramic, marble and gra-nite tiles average only 12
percent of the industry. This is because the mosaic tiles are prices between Rs.10-15 per
sq.feet, ceramic tiles at Rs.18-35, marble tiles at Rs.50-100 and granite tiles at 60-150.
The vitrified tiles with the polished finishing cost Rs. 60-120, while the unpolished ones
are worth Rs.35-50.

The disparity in the levy of excise duty has tilted the balance in the favour of the
unorganised sector, which evades the tax blues, and as a result, sells at cheaper rates.
Unfortunately, the end-user of ceramic tiles is more price-conscious than brand-
conscious.

Apart from granting various exemptions to SSI, the budget also extends the benefits to
corporates sourcing their products from these industries.

Thus, instead of the small industries being dependent on the bigger players for survival, it
is the big corporates who have to sub-contract a part of their job to SSIs only for tax
benefits.

MARKETING

Almost all the tiles companies import technical equipments and machinery from Italy. All
tiles are subjected to the same manufacturing process. And the much-hyped USP of these
tiles is more of a marketing strategy. Except for Johnson, all the companies have a
regional monopoly only in the areas near their production facilities. For instance, 54

31
percent of Murudeshwar’s turnover is from the southern state and only 28 percent from
the western zone.

However, according to H.S.Venkatesh, G.M. (Marketing) of Murudeshwar, this is mainly

because these regions have a greater demand for the company’s premium verified
porcelain tiles. Whatever excuse the players may offer, it is true that KCL rules over the
Western zone and Bell over the North. Similarly, it is not easy for a new entrant to create
a brand quickly, since tiles are highly fashion-sensitive products and every manufacturer
has to stock at least 30-40 designs of each size.

The major deciding factor, therefore, in the tiles and ceramic competition, is the
distribution network. A wide product range, coupled with a strong distribution network,
will translate into brand equity. A case in point is of KCL, which with its aggressive
marketing strategy, has emerged as the second largest player, overtaking the mighty SPL.
According to Ajit Singh, Area Manager, Western zone projects of KCL, it has a network
of 300 distributors. It has now opened up its own shopping malls in all leading cities and
boasts of 230 and 185 shades in wall and floor tiles respectively.

Sonora boasts of a marketing network of over 400 dealers and 2,000 sub-dealers. With
lateral interests in roofing material and asbestos pipes, Motwani is all poised to position
the group as an one-stop building material outlet. Within four years, Sonora has captured
12

Contrary to the popular myth, wall and floor tiles cannot be used as substitutes for one
another. Floor tiles are thicker, larger and more porous than wall tiles. The manufacturing
process is also very different. While floor tiles are single-fired, the wall tiles have to be
double-fired. This means that producing wall tiles requires more energy and would entail
greater costs.

32
INTERNAL INFLUENCES

You can start your examination of the influence on consumer purchase decisions by first
looking inside yourselves to see which are the most important internal factors that affect
how you make choices.

Perceptual Filter

Perception is how we see ourselves and the world we live in. However, what ends up
being stored inside us doesn’t always get there in a direct manner. Often our mental
makeup results from information that has been consciously or unconsciously filtered as
we experience it, a process we refer to as a perceptual filter. To us this is our reality,
though it does not mean it is an accurate reflection on what is real. Thus, perception is
the way we filter stimuli (e.g., someone talking to us, reading a newspaper story) and
then make sense out of it.

Perception has several steps.

o Exposure

 Sensing a stimuli (e.g. seeing an ad)

o Attention

 An effort to recognize the nature of a stimuli (e.g. recognizing it is an ad)

o Awareness

 Assigning meaning to a stimuli (e.g., humorous ad for particular product)

o Retention

o Adding the meaning to one’s internal makeup (i.e., product has fun ads)

How these steps are eventually carried out depends on a person’s approach to learning.
By learning we mean how someone changes what they know, which in turn may affect

33
how they act. There are many theories of learning, a discussion of which is beyond the
scope of this tutorial, however, suffice to say that people are likely to learn in different
ways. For instance, one person may be able to focus very strongly on a certain
advertisement and be able to retain the information after being exposed only one time
while another person may need to be exposed to the same advertisement many times
before he/she even recognizes what it is. Consumers are also more likely to retain
information if a person has a strong interest in the stimuli. If a person is in need of new
car they are more likely to pay attention to a new advertisement for a car while someone
who does not need a car may need to see the advertisement many times before they
recognize the brand of automobile.

34
 CHAPTER-3

DATA ANALYSIS AND

PRESENTATION

35
 1. What is your position within the company?

Level of management People(%)

EXECUTIVE 40

MIDDLE LEVEL MANAGEMENT 20

SENIOR MANAGEMENT 25

OTHER 15

Our survey result contributed out of 100 people 20 % people are working in cedar to
Middle management also 25% respondent from KAJARIA CERAMICS working as a
senior management major chuck which contributed in our survey is executive i.e. 40% .
Other signifies a junior level of employee in KAJARIA CERAMICS .

36
We taken this ratio because for change management decision mostly taken by the senior
management and then after it adding on affect to the junior or middle management people
to became a change management subject.

37
2. For how long do you work for your company?

Duration of tenure Response(%)

Less than 3months 17

3-6 months 16

6-12 months 12

1-2 yrs 14

3-5yrs 28

More than 5 yrs 8

No answer 2

Other 3

38
Out of 100 people for our survey 28% people responded that they serving to KAJARIA
CERAMICS are more than 3 years but there work tenure is less than of 5 years. Adding
to this 17% respondent working with KAJARIA CERAMICS is more than of 3 months
which is basically junior management also 16% said they working with KAJARIA
CERAMICS is more than with range of 3-6 Months.14% respondent said they working
with KAJARIA CERAMICS last 1-2 Years. While 8% respondent said they working
with KAJARIA CERAMICS more than 5 years

39
3. How was the initial training in your company?

Training of employee expectation Response(%)

Below expectation 19

Meets expectations 28

Above expectations 20

No training 14

Other 19

Asking this question means to judge the training need in KAJARIA CERAMICS
company , out of 100 people 20% respondent said they thing training which they got in
KAJARIA CERAMICS is above than expectation. And n 28% respondent said training
given by the KAJARIA CERAMICS is meeting their requirement, 19% people said the
training which they got is below the expectation and 14 % respondent said they didn’t got
any training in KAJARIA CERAMICS .

40
 4.What is your Salary monthly?

Salary People(%)

15000-20000 10

20001-25000 28

250001-30000 26

30001-35000 14

Above 40000 9

Not answer 8

Other 3

Salary break up shows the employees which contributed in our survey at what range of
their salary 28% respondent said there salary range in between of 20000-250000, and

41
26% respondent said there salary range is 25001-30000 also 14 % people said there
salary range would be more that 30000-350000 per month.

Hence KAJARIA CERAMICS is an average paymaster because 87% people responded

that their salary is more than 10000 per month.

42
 5.This organization has a clear focus and sense of direction for the future.

Direction of future objective Response(%)

Strongly agree 28

Agree 38

Disagree 14

Strongly disagree 20

This question brief us about the organization has a clear focus and sense of direction for
the future or not so this determine the value of the company which says sharing thought
with the employees is there or not.

According to our survey result out of 100 people which is our sample size said 28%
people are strongly agree with this views that KAJARIA CERAMICS a clear focus and
sense of direction for the future. And 38% people agreed with this views that KAJARIA
CERAMICS has cleared focus towards the future direction. But 14 % people said they

43
disagree with a views of KAJARIA CERAMICS that they has clear focus towards future
but the 20% people as our respondent are strongly disagree with the statement that ask
KAJARIA CERAMICS has a clear focus and sense of direction or not. Recommendation
for KAJARIA CERAMICS would be the first identify 34 people who are not agree about
a clear focus and sense of direction future.

44
7. Frequency of the purchase of the KAJARIA CERAMICS Valve provider

Frequency of purchase Response(%)

1 month 14

1-3 months 29

3-6 months 34

More than a year 23

Frequency of the purchase of the

KAJARIA

23% 14% >1 months

1 - 3 months

29% 3-6 months

34% More than a year

The frequency of the purchase of the KAJARIA CERAMICS provider depends upon the
work a person does and the purchasing power of the people. Form our survey clearly
states that 14% respondent buy KAJARIA CERAMICS provider monthly basis and 34
% people buy 3-4 moths in between KAJARIA CERAMICS provider . While 29 %
people purchasing Health care provider from KAJARIA CERAMICS is 3-6 Month.

45
8. What is the best medium for the advertisement according to the respondent’s point of
view?

Advertisement Response(%)

Newspaper 17

Television 31

Radio 22

Hoardings 17

Caimpaigns 13

Here we come to know that Television and Radio are the two most popular
advertisements medium that contributes 31 % and 22 % radio also for other way to
advertisement 17 % respondent clearly states that news paper is the best way to advertise
also 17 % respondent realize that Hoardings is also like news paper.

46
9. Is KAJARIA CERAMICS provider more affordable than the other provider available
on your nearest living area?

Affordability Response(%)

Yes 68

No 32

Affordability

No
32%

Yes
68%

This question gives us insight of the affordability of the provider or service. With low
disposable incomes, provider s need to be affordable to the Delhi consumer, most of who
are on daily wages. Now we check what Delhi customer want from the company in terms
of their provider prices.

47
Out of a10 sample size we consider to choose first strongly agree respondent who
believes that KAJARIA CERAMICS provider is affordable for him/her 68% respondent
out of 300 says KAJARIA CERAMICS provider is affordable in comparative of other
competitor. While 32% are only agree with this statement that KAJARIA CERAMICS
has much affordable price of their respective provider .

48
10. KAJARIA CERAMICS provider available in your near area?

Response(%)

Strongly agree 31

Agree 27

Disagree 17

Strongly disagree 17

Neutral 8

From the our sample size 100 here are the question would gives the insight Study on
buying behaviour of consumer indicates that the Delhi 35% of purchase occasions.
Therefore sheer provider availability can affect decision of brand choice, volumes and
market share. Some of the FMCG giants like HLL took out project streamline to
significantly enhance the control on the Delhi supply chain through a network of Delhi
sub-stockists, who are based only.

49
Form our survey result it is showing that 31% of says that KAJARIA CERAMICS
healthcare provider or food provider s are easily available in their respective area and
they are strongly agree with this.

50
CHAPTER-4

CONCLUSION

51
 CONCLUSION

Is your builder giving you a wide range of choice in tiles for your newly constructed flat?
The Indian market is flooded with a range of options in branded tiles and depending on
what you pick up, prices can vary anywhere between Rs 22-200 per sq ft. From regular
ceramic tiles to high range vitrified stuff from Italy, the tile market has never looked
better. In the Indian tile mart, one can choose from H&R Johnson (India), SPL, Kajaria
and NITCO. Others include Vermora, Bell Ceramic, Gokul and Asian. H&R Johnson is
present in all ranges from low to upper end and has various brands under different price
tags. Its Porselano brand includes vitrified tiles while Marbonite priced between Rs 62-
200 per sq ft is available in colours like red, blue and yellow. If you were to choose
between ceramic and vitrified products, Kajaria and NITCO have textured tiles in the
affordable range of Rs 40-50. The vitrified range of these companies usually cost Rs 50-
100. A similar price category is seen in the Asian and Vermora brand of tiles.
Interestingly, you can mark borders on tiles in glass at an extra price of Rs 225 per ft. If
this is steep, choose from vitrified and ceramic borders at Rs 150 and Rs 25 respectively.

As competition in India's tile market gets aggressive, tile makers are devising new
products and finishes to woo customers. Spl, for instance, has recently introduced crust -
8'x12' wall tiles for floors and walls in earthy shades. They are available in both stone
finish matte and glossy finishes. Since an increasing number of people are choosing tiles
over marble because they are easier to install, clean and maintain, and are affordable,
more variety is only welcome. Somany has come up with a 14'x10' range of rustic wall
tiles called Manhattan. This size, according to a company official, is also preferred
internationally.

Since pricing is competitive, product variations become the selling point for companies
that are also riding high on selling quality products. Kajaria claims that the company has
no interest in the low-end ceramic tiles market and will focus on upper market ceramics,
vitrified and imported tiles.

52
Kajaria imports tiles from china and sells it under its Kerrogress brand. According to
Abhishek Somany, joint managing director, Spl, there is a maximum of 5 per cent
difference on prices of products from Somany, Kajaria and NITCO on an apple to apple
basis, but he adds that H&R Johnson doesn't make the same grade. "it has the largest
market share catering to the lower end of the segment. We are among the most expensive
brands in India and don't compromise on quality," he says. H&R Johnson's company
official counters: "we are a premium brand, we have the widest range and are the market
leader." Spl also claims it offers the best variety of imported tiles. "our alliances are with
the best in the world, such as Kalebador, Keraben, Leonardo, Azuvi or roman," says
Somany.

In terms of dealer network, however, H&R Johnson leads with a total of 1,200 dealers
and 18 display centres. Both Kajaria and Somany have 600 dealers each with Kajaria
having 18 exclusive showrooms and somany having 12 company display centres. In
terms of sub-dealers, all three are over 15,000. Kajaria's Sanjeev Agarwal, gm (finance),
claims the company has an all-India presence with northern and western India sharing
over 70 per cent of its total sales. And Somany claims only Somany and Kajaria have the
true all-India presence catering to a, b and c type cities. H&R Johnson is not behind. It
has intensified rural penetration by 45 per cent and is also focussing heavily on northern
markets.

Companies are also providing industrial and tough tiles. Somany is expanding its basket
into vc shield (for high-density areas like subways and public places) and Durastone
heavy duty vitrified tiles. H&R Johnson is offering Endura, specialised industrial and
pavement tiles.

H&R Johnson offers complete kitchen and bathroom solutions under its luxury brand
Milano. Besides, it is rolling out a combination of tiles and XSanitaryware in the mid-
and top-range under the brand porselano. According to Vijay Aggarwal, managing
director, H&R Johnson (India), diversification into the Sanitaryware business is part of
the company's larger plan to provide customers with a one-stop solution for their
requirements. With the 270 million sq metre Indian ceramic industry valued at Rs 5,500
crore (the figure has grown at over 12 per cent over the last three years), there seems to

53
be enough space for most leading players to experiment with new products and solutions.
Till then, customers can act pricey

54
 CHAPTER-4

RECOMMENDATION

 Company should give more importance in Brand Building.

o Brand equity and Brand awareness should be created.
o Prices should go with the volume and according to the competitors.
o Service stands should be given top priority.
 Technical Services should be provided by the companies to create awareness of
brands to the consumers.
 company should make stocks available on demand at all times with product mix.
 Dealer oriented schemes giving moral boost should be encouraged on par with
other companies.
 100 % Transparency and accuracy in transactions to dealers should be made
available from time to time.
o Logistic arrangements should be assured to dealers/ consumers for
intercity movements.
o confidence building measures should be periodically under taken.

55
 SCOPE OF THE STUDY

 KAJARIA Ceramics exports to more than 20 countries round the Globe. The
International Marketing operations are organized by a specialist export division
that manages a network of international agents and distributors supported by our
exclusive office/showroom in UAE. Now in international markets we enjoy a
similar brand Recall as that of Domestic.

 Our Brand "Kajaria" has today become synonym of Quality, service and
innovation not only in the domestic market but even in the international market.
"Kajaria" products are also well accepted in European market. With increased
capacity, increase in turnover and a growing domestic and exports market, Kajaria
Ceramics is set to emerge as a leader in the international ceramic tiles market.

56
 FINDINGS

Our survey result contributed out of 100 people 20 % people are working in cedar to
Middle management also 25% respondent from KAJARIA CERAMICS working as a
senior management major chuck which contributed in our survey is executive i.e. 40% .
Other signifies a junior level of employee in KAJARIA CERAMICS .
We taken this ratio because for change management decision mostly taken by the senior
management and then after it adding on affect to the junior or middle management people
to became a change management subject.

Out of 100 people for our survey 28% people responded that they serving to KAJARIA
CERAMICS are more than 3 years but there work tenure is less than of 5 years. Adding
to this 17% respondent working with KAJARIA CERAMICS is more than of 3 months
which is basically junior management also 16% said they working with KAJARIA
CERAMICS is more than with range of 3-6 Months.14% respondent said they working
with KAJARIA CERAMICS last 1-2 Years. While 8% respondent said they working
with KAJARIA CERAMICS more than 5 years

Asking this question means to judge the training need in KAJARIA CERAMICS
company , out of 100 people 20% respondent said they thing training which they got in
KAJARIA CERAMICS is above than expectation. And n 28% respondent said training
given by the KAJARIA CERAMICS is meeting their requirement, 19% people said the
training which they got is below the expectation and 14 % respondent said they didn’t got
any training in KAJARIA CERAMICS .

The frequency of the purchase of the KAJARIA CERAMICS provider depends upon the
work a person does and the purchasing power of the people. Form our survey clearly
states that 14% respondent buy KAJARIA CERAMICS provider monthly basis and 34
% people buy 3-4 moths in between KAJARIA CERAMICS provider . While 29 %
people purchasing Health care provider from KAJARIA CERAMICS is 3-6 Month.

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This question gives us insight of the affordability of the provider or service. With low
disposable incomes, provider s need to be affordable to the Delhi consumer, most of who
are on daily wages. Now we check what Delhi customer want from the company in terms
of their provider prices.

Out of a10 sample size we consider to choose first strongly agree respondent who
believes that KAJARIA CERAMICS provider is affordable for him/her 68% respondent
out of 300 says KAJARIA CERAMICS provider is affordable in comparative of other
competitor. While 32% are only agree with this statement that KAJARIA CERAMICS
has much affordable price of their respective provider .

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59
 STUDENT WORK PROFILE

There are mainly two types of work profile for students which are as following:

a) ROLE
b) REPONSIBILITY

ROLE:

Role for student as a market researcher for KAJARIA CERAMICS in different tiles
world like as KAJARIE/SOMANY/NITCO/ORIENT/LOCAL/OTHER.

And collect information from different tiles sellers. And collect information like as which
brand they prefer most which types of tiles they prefer. How many cartons they are sell
per month? Are you interested in KAJARIA tiles? as so many information from sellers
for KAJERIA tiles.

RESPONSIBILITY:

There are following responsibility for a student for a work:

I should be a

i. Good listener
ii. Good communicator
iii. Best convenience
iv. Not aggressive, etc.

SUMMARY OF LEARNING EXPERIENCE

I have done my summer Training in KAJARIA CERAMICS at Badarpur in New Delhi.

My work profile is Market survey. At 1st when I join this organization I learn each &
everything about this company, its profile & its organizational culture. KAJARIA
CERAMICS has a very good & well planed organization. These are some very important
think that make it best for other:

i. It has very good working culture.

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 ii. It has large marketing channel.

iii. It has very good employee and employer relation.

iv. It takes many social responsibilities.

v. It gave future security to his employee.

As a summer Trainer I learn many things in KAJARIA CERAMICS. Each and every
person in this organization is very helpful. They all are very helpful & cooperative nature.
These are some very important point that I learn in this project:

i. Hard work and honesty is key word of success.

ii. Good communication skill takes very important role in marketing research.

iii. Good people make a successful organization.

iv. Marketing is both art & science.

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 BIBLIOGRAPHY

Aryee, S., Budhwar, P.S., & Chen, Z. X. (2002) Trust as mediator of the relationship
between Nagarjuna al justice and work outcomes: test of a social exchange model,
Journal of Nagarjuna al Behavior, 23(3): 267-285.

Bae, J. & Lawler, J. J. (2000). Nagarjuna al and HRM strategies in Korea: Impact of firm
performance in an emerging economy. Academy of Management Journal. 43: 502-517.

Bryk, A. S. & Raudenbush, S.W. (1992) Hierarchical linear models. Newbury Park, CA:
Sage.

DeConinck, J. & Stilwell, C. D. (1996). Factors influencing the Nagarjuna al

commitment of female advertising executive. American Business Review, 14(2): 80-88

Gaertner, K. N. & Nollen, S. D. (1989). Career experiences, perceptions of employment

practices, and psychological commitment to the Nagarjuna . Human Relations, 42, 975-
991.

Business India

Business World

Gloom

www.blonnet.com

www.superbrandsindia.com

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 APPENDIX

QUESTIONNAIRE

1. What is your position within the company?

(a) Middle Management (Manager, Senior Manager, General Manager.)

(b) Senior Management(Above than General Manager)
(c) No answer
(d) Other
(e) Executive

2. For how long do you work for your company?

(a) Less than 3 months (b) Between 3-6 months

(c) Between 6-12 months (d) Between 1-2 years
(e) Between 3-5 years (f) More than 5 years
(g) No answer (h) Other

3. How is Financial management system functioning in your company ?

(a) Well below expectations (b) Meets expectations

(c) Above expectations (d) No training
(e) Other

4. What is your Salary monthly?

(a) Between 15,000-20,000 (b) Between 20,001-25,000

(c) Between 25,001-30,000 (d) Between 30,003001-35,000
(e) Above 40,000 (f) I prefer not to answer
(g) Other

5. This organization has a clear focus and sense of direction for the future.

(a) Strongly Agree (b) Agree

(c) Disagree (d) Strongly Disagree

6. The various ranks given by the customers about their perception about different
players in the market:

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 (a) Cheap (b) Easy Availability
(c) Quality (d) Total

7. Frequency of the purchase service of the Kajaria Ceramics .

(a) >1 months (b) 1-3 months

(c) 3-6 months (d) more than a year

8. What is the best medium for the advertisement according to the respondent’s point
of view?

(a) Newspapers (b) Television

(c) Radio (d) Hoardings (e) Campaigns

9. Is Kajaria Ceramics more affordable than the other company which available on
your nearest area of city.?

(a) Yes (b) No

10. Kajaria Ceramics available in your near area?

(a) Strongly Agree (b) Agree (c) Disagree

(d) Strongly Disagree (e) Neutral

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