The Hindu Business Line : Faber to hike stake in Indian joint venture

ITALIAN kitchen chimney major, Faber SpA has increased its equity stake by 24.2 per cent to 75.2 per cent in its Indian joint venture Faber Heatkraft Industries Ltd (FBIL) as part of its strategy to nurse the market.

The company bought the stake from four Indian individual investors, who still retain a 19 per cent stake. The joint venture with an overall equity of Rs 3.5 crore, has another stakeholder, Nardi, an Italian company making gas hobs (a ready-to-fix burner frames on the kitchen counters) with 5.8 per cent share.

FHIL manufactures and markets electric chimneys and accessories and cooking range and gas hobs.

The company, which expects a growth of 80 per cent in its sales turnover to Rs 75 crore this year (2004-05) from Rs 42 crore last year, has planned to step up its investment to meet the growing demand for its products. FHIL would be spending Rs 11 crore to meet the expansion programme, which will involve strengthening Faber's brand positioning, increasing its production capacity, stepping up dealer network by 800 to 2,000 and setting up a call centre for customer care to increase its market share in the country.

Addressing a press conference here on Tuesday to announce the launch of new products of the company, Mr Pralhad Bhutada, Managing Director, FHIL, said unlike China, where five million electric chimneys with a new generation modern baffle filter are sold every year, the Indian market is expected to catch up with big volumes only in the next two or three years. However, with the current rate of growth, the company was preparing itself for the sudden explosion by increased investment, he said.

Unlike the mesh filter, which is popular in India, baffle filter avoids clogging and is ideally suited for oily cooking, thus reducing maintenance problems.

The company also announced the appointment of Ms Shonal Rawat, former Miss India as the brand ambassador for Faber.

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