Name: Aegidius Savio MondolUnitedworld School of Business, KolkataPGPM. Batch – 2012-14Specialisation : MarketingEnrollment no. : 0104010003

A presentation on the Plasterboard market in India with special reference to

Saint Gobain Gyproc India Ltd.

ObjectivesThe objectives of my study are: To do an entire market survey of plaster boards with special

reference to Saint-Gobain Gyproc and see how the company works and operates in the market.

To have a specific idea about the major players in the market, their backgrounds and their marketing strategies.

To do an in house research of the Saint -Gobain Gyproc and get to know about the products , systems and substitute products it offers to the market for sale.

To find out what types of consumers it targets along with its acceptance in the market.

To gather in-depth knowledge of the various product lines offered – their benefits ,features, disadvantages and other substitutes .

To study the recent trends in the market with respect to plaster boards

Methodology of researchThe sources of data which aided me in this presentation were mainly i) Primary Sources and ii) Secondary sources

Primary Research Sources Questionnaire Method 

Secondary Research Sources Internet Articles Newspapers MagazinesSample Design Sample size: 15 Sample selection criteria: Random selection

WHY SAINT GOBAIN GYPROC ?

INTRODUCTIONWhat is Gypsum?

Gypsum is one of the more common minerals in sedimentary environments. It is a major rock forming mineral that produces massive beds, usually from precipitation out of highly saline waters. Since it forms easily from saline water, gypsum can have many inclusions of other minerals and even trapped bubbles of air and water.

Gypsum has several variety names that are widely used in the mineral trade.

"Selenite" is the colorless and transparent variety that shows a pearl like luster and has been described as having a moon like glow. The word selenite comes from the Greek for Moon and means moon rock.

Another variety is a compact fiberous aggregate called "satin spar" . This variety has a very satin like look that gives a play of light up and down the fibrous crystals.

A fine grained massive material is called "alabaster" and is an ornamental stone used in fine carvings for centuries, even eons.

Manufacturing Gypsum

Gypsum is made from:Natural gypsum: sedimentary rock extracted from mines

or underground quarries,Synthetic gypsum: produced from by-products of energy

generation or industrial waste.  Making gypsum from natural gypsum involves crushing

and grinding the gypsum mineral, then firing it at 150°C. Additives can be mixed with the gypsum in very small quantities.

Starch improves the adhesion between the gypsum and the cardboard in plasterboard production, retarding agents slow the setting time of gypsum.

The Gypsum MarketThe gypsum market is very local and highly

dependent on the prevailing construction methods in each country.

The demand for plasterboards is closely linked to the construction methods in each country.

Demand is high in the United States, Japan and Australia. United-States represent almost 50% of the world demand.

According to the study, demand for gypsum in India is expected to take until 2017 to recover to the peak level . On the other hand, Chinese markets have continued to grow and can be expected to grow more rapidly than the 5% growth in 2009, modest by Chinese standards. It is estimated that total gypsum consumption in India will grow by about 6% in 2015.

Markets for plasterboard are considerably down from their peaks since 2009 because of the financial crisis and particularly its effect on the housing market in the India and elsewhere

The gypsum market is growing at a CAGR of 9.9% with the consumption at 1.2 billion tonnes and it is forecasted to reach approximately $2.4 billion by 2018, and $3.8 billion by 2023, according to a major new report by Smithers Apex.

Worldwide gypsum consumption by region from 2008 and forecasted till 2023 (million tonnes)

Source: Smithers Apex

A pie chart showing the distribution of the world wide gypsum production (total market size of 1.2 billion tonnes as of 2013) country wise.

Source: Smithers Apex

Gypsum in IndiaThe in site reserves of gypsum are estimated at 285

million tonnes.The table below shows that there have been wide

temporal variations in the production of gypsum in India. The production increased rapidly from 207 thousand tonnes in 1951 to 2,210 thousand tonnes in 1996- 97, thereby recording about 11 times increase in 46 years. The production reached an all time high of 3,247 thousand tonnes in 1999-2010.

Rajasthan is by far the largest producer of gypsum in India. This state produced 2,815 thousand tonnes out of the total production of 2,842 thousand tonnes in 2002-03.

Year 1951 1971 1990-95

1996-00

2000-05

2006-2009

2009-2013

Production (in ‘000 tones)

207 1089 1581 2195 3247 2667 2842

Value ( in millions)

Rs.1.26 Rs.12.16

Rs.144.61

Rs.313.09

Rs.512.04

Rs.440.71

Rs.394

A table showing the production of Gypsum in India over the years along with the corresponding values.

The table alongside shows the distribution of non metallic reserves in India.

Out of this entire composition the squares represent the places where Gypsum is found in India.

Major Players in India Out of the 390 million dollar ( 600 crore) gypsum market Saint

Gobain Gyproc accounts for almost 48% of the total market share, thus being the pioneer and the clear market leader. Lafarge Boral has a 30 % market share and ranks second. Sai Gypsum, the major Gypsum brand in the west has about 15% share in the market while the remaining percentage is comprised by small players like Armstrong, RCF etc.

Saint gobain gyproc48%Lafarge Boral

30%

Sai gypsum

15%

others7%

market share

Major PlayersLAFARGE BORAL GYPSUM INDIA LTD.

A joint venture between the French cement company Lafarge and the Australian company Boral, is now balancing two its most matured markets — the US and France with two emerging economies India and China.

Annual Turnover : USD 10 to 50 Million

Key features: 130 strong distributors across India30% market sharewarehouses in Chennai, Hyderabad & Mumbai.

A diagram showing the revenue earnings of Lafarge Boral over the years ( in USD Million) over the last decade.

Gypsum Board Demand / GDP per capita

The above graph shows the relation between the GDP per capita of the south Asian countries ( mainly) and the gypsum demand of Lafarge Boral accordingly .

Products offered :

In 2007, it introduced its Single Gypsum Board brand LaGyp which has been readily accepted by the Indian market and is today recognized as a mark of quality for the gypsum board systems and services under LAGyp brand. 

-Fire and moisture resistant gypsum boards.-New patterns for ceiling tiles. -Jointing compound, -Metal systems ,and -other building accessories.

Gypsum BoardsLAGyp standard boardLAGyp moistblocLAGyp fire blocLAGyp EchoblocLAGyp heatblocLAGyp impacboard

Ceiling tilesVinyl Touch Ceiling TilesTexture Touch Ceiling TilesColour Touch Ceiling TilesAcoustic Touch Ceiling TilesPaper Touch Ceiling Tiles

SAI INDIA GYPSUM LTD.•

Established in the year 2010, “Sai India Gypsum Private Limited”, are a leading manufacturer, supplier and exporter of a comprehensive range of Plaster of Paris and gypsum products.

Their primary USP is the competitive prices they offer and the stringent testing methods their products go through before being launched in the market.

Products offered :SAI India Gypsum Ltd. are a prominent manufacturer,

supplier and exporter of wide range of Plaster of Paris.

Other products consists of : - Gypsum Universal Plaster, - Gypsum Stucco Plaster, - One Coat Gypsum Plaster, - Plaster of Paris .

Major clientele :

- Nahar Group. - Gujarat Land Developers

Overview of Saint Gobain Gyproc Ltd.Company history :

Saint-Gobain Gyproc India Ltd. is part of the Saint-Gobain Group and a market leader in the construction space in India for well over three decades.

The company was incorporated on 5th February 1985 at New Delhi. It was promoted jointly by Hyderabad Industries Limited and BPB Industries ,U.K.

Saint-Gobain Gyproc has four facilities in India with a total capacity of 40 million sq metres of gypsum annually.

ProfileThe world of Saint Gobain Gyproc is about providing innovative building solutions. Innovative building solutions mean delivering• Complete range of products required for ceilings and drywall partitions ranging from gypsum plasterboards  to acoustic ceiling tiles to metal framing systems to jointing and finishing products and accessories.

Acoustics 

Fire protection

Thermal insulation

Aesthetics

Saint Gobain Gyproc is a part of the 43.8 billion Euros Saint-Gobain group and is a pioneer and a market leader in the Indian market.

It has 4 manufacturing plants in Jind, Wada, Bangalore and Chennai which is backed by sales and distribution set up across the country.

About Saint Gobain Group Saint Gobain group has basically eight companies in operation

today across two sectors – Construction Products (Gyproc, Weber, Seva Engineering )

Innovative Materials (Grindwell Norton, Refectories , Crystal and Detectors India , Sekurit and Glass) - with an overall turnover of over Rs.2000 Crores.

PRODUCTS and SYSTEMSProduct Mix and Features:

Gypboard ® Extensively used in False Ceilings & Walls & Partitions systems.

Gypboard Plain.MR BoardFire Line BoardMPL Board

Gypsteel® Metal Components of all systems

Gypframe : Budget Metal SeriesUniversal Plaster ™

A revolutionary plastering material with International standards

FEATURES Gypboard

- Fire protection- Sound insulation & absorption- Thermal insulation

Universal PlastersFire protection,Thermal insulation & fast track

construction etc. Gypsteel

Structural performance of systems.

Systems GypCeling Sysytems- The GypCeiling ceiling system is a

monolithic suspended ceiling system that gives a beautiful, homogeneous appearance and smooth finish without visible joints. The system comprises a concealed Gypsteel ULTRA TMmetal frame work suspended from the structural soffit. Gypboard or Gyproc plasterboards are screw fixed to the framework to form the ceiling lining

Grid Ceiling Systems - The GRID ceiling system is a lightweight lay-in grid ceiling system available in concealed or exposed grid options. The ceiling comprises a Gyproc metal framework formed from Main T section with Cross T section slotted in-between to form the grid.

Drywall Partititon Systems - GypWall drywall partition system is a light-weight system consisting of Gypsteel ULTRA  Gl framework with Gypboard /Gyproc gypsum plasterboard, screw fixed on either side with drywall screws. 

Gypliner -  System consists of fixing plasterboard to highly galvanized   GypLynerTM section, secured to walls by fixing brackets. Highly galvanized metal sections make it resistant to moisture, so it is not affected by damp and humid areas.

Gyproc Plaster board

MR board

Ten Year Financial Highlights2003

2004 2005 2006 2007 2008 2009 2010-11

2011-12

2012-13

Sales (in Rs. Lacs)

25449

30135 36049 42129 49701 55553 74504 83763 95132 99068

Earnings per share (rs)

3.69 5.27 6.40 8.31 10.21 9.94 15.81 15.47 18.72 17.64

Divide-nds per share (rs)

1.63 2.50 2.75 3.50 8.00 4.00 6.00 6.00 6.50 6.50

Key RatiosCurrent ratio

1.40 1.24 1.32 1.22 1.34 1.49 1.79 2.07 1.64 1.73

Debt equity ratio

0.03 0.01 - 0.01 0.01 - - - - -

Operating margin %

12.61

14.53 14.89

16.30 16.61 14.35 17.49 15.04 15.70 13.69

Source : 63rd Annual Report , Saint Gobain group , FY : 2012-13

Financial Performance

The tables showing the net worth of Saint Gobain Gyproc over the years and the sale of products respectively

Operating Margin (%) vs. ROI (%)

Source : 63rd Annual Report , Saint Gobain group , FY : 2012-13

Strengths

Weaknesses

Opportunities

Threats

SWOT Analysis

Strengths Booming and prospective

market A large number of product

lines to suit the different needs of the consumers.

Manufactured by highly trained workers under strict supervision.

Illustrative brand image.

Weakness Price competition from other

companies , especially Lafarge Low Penetration in Rural

Market. Cost of maintenance in the

power plants are high. Long training procedures. Workers have to be highly

skilled. Difficulty in making the

masses understand about the features of different product lines because of the high technicalities involved with it.

Opportunities Huge market. Saint-Gobain is, therefore,

committed to investing in India and to establishing a leadership position in all its businesses here.

Profitable growth along with sustainable development.

Threats Existing competitive market. Entry of many new players in

immediate future. Emergencies like war,

terrorism, natural calamity etc.

Change in consumer preference.

Adverse macroeconomic conditions like recession and economic slowdown.

Annexure

Saint –Gobain Gyproc India Ltd. 1.Name: Mr./Ms_________________________________________________ 2. Occupation: _________________________________________________ 3. Monthly Turnover: ( please tick the preferred box)

Less than Rs. 40000 Rs. 40000 – Rs.70000Rs. 70000 –Rs. 100000 Above Rs. 100000

4. For how many years have you been associated with Saint-Gobain Gyproc ? (please tick the preferred box)

Less than 2 years 2 – 5 years 5-7 years More than 7 years

 5. Which product lines have you mainly dealt with?______________________________________________________________________ 

6. Did you find the products up to the standard? If ‘not’ then mention in detail what are the things you want us to improve in our products?

_____________________________________________________________________________________________________________________.

7. If you are satisfied, then how much you will rate the product you have used out of 10?___________________.

8. Which is the best medium through which Saint Gobain should advertise its products and systems?

Television Newspaper MagazinesFriends and family Posters and banners Others

9. Do you think the advertisements are quite convincing for those who are new to the products? If ‘No’, please mention why?

______________________________________10. Are you satisfied with the company’s distribution channels? Yes No

_______________________________________________________________________________ _____________________________________________________

DATA RESPRESENTATION The representation of data is based on the responses of the dealers associated with the company. The sample size is 15.

Figure: a pie chart showing the number of years the dealers are associated with Saint Gobain Gyproc Ltd.

Figure: a pie chart showing the products and systems that the dealers mainly deal with, thus depicting a very clear picture of the current market demand

Products mainly dealt with?

Plasterboards : 40% Systems : 27% Metal Frames : 13% Gypsteel : 20%

( APPROX FIGURES TAKEN TO AVOID DECIMAL POINTS)

Plasterboards, 40%

Systems, 27%

metal Frames; 13%

Gypsteel, 20

magazines26.67%

Through dealers 33.33%

television13.33%

posters13.33%

news-papers6.67%

others6.67%

Which is the best medium through which Saint Gobain should communicate about its products and systems?

Through dealers – 33.33%Magazines – 26.67%Television – 13.33%Posters -13.33%Newspapers - 6.67%Others – 6.67 %

Analysis : the dealers think that it is best if the products are advertised through them, because they have an existent customer base and while selling other products they can easily do a push strategy and sell gypsum. Others have also said that magazines are a best form as detailed information will be given. The television medium was also preferred among some because they said that with a TV ad, they can get a competitive edge

YES NO0

40

80

Satisfied with the way the products are ad-

vertised?

Do you think the advertisements are quite convincing for those who are new to the products? If ‘No’, please mention why?

Yes: 80 %No. 20%

ANALYSIS: Around 80% of the dealers think that the advertising done by Saint Gobain Gyproc are convincing as the dealers all get monthly issues and journals of the company which has information about the company’s products, prices, ranges and also future plans.. However some think that that Saint Gobain Gyproc should give more advertisements in other mediums as well, because the new dealers and customers who are new will not get proper information in the print media, and also a television advertisement will have an edge over its competitors.

YES

NO

Figure: a pie chart showing the percentage of dealers who are happy with the company’s distribution channel, over those who are not

Are you happy with the company’s distribution channel?

Yes – 86.67%No- 13.33%

ANALYSIS - Most of the dealers (total of 13) were well contented with the company’s distribution channels including its warehousing and overall logistics. While only a few ( 2 out of 15) of them though that it was a bit too complex, and this might lead to problems in the future.

FINDINGS The dealers who are associated with Saint-Gobain Gyproc do not follow the same

marketing strategies as the company.

The primary demand in the market is that of plasterboard and to some extent, false ceiling systems. Gypsteel and metal frames although purchased are used in very small quantities.

Saint-Gobain Gyproc advertises its products mainly through business magazines and newspapers, they hardly use the television and the radio media. However their major communication medium is via word of mouth.

The promotional strategies of Saint-Gobain in India compared to other nations is quite low (only 2%).

Saint-Gobain gyproc manufactures its products keeping in mind the ever increasing problems of environmental degradation. They manufacture their products in such a way that is environmentally safe. Sustainable development in the society is their primary goal, including a greener and a cleaner environment, and this is carried out by their project ‘Go Green’.

LIMITATIONSThe researcher had to complete the work within the stipulated

time limit and the sample size was restricted to 15 respondents.

Since the project is of qualitative nature there was participant’s biasness in some cases.

The respondents were not open to the questions asked.

Working , and travelling to South Gujarat as a part of my work made me give very little time and attention to this report.

Further studies about the company involved to research it in depth from the net, but the main problem was that since I am posted in Ahmedabad the face to face interaction with the dealers could not be done. I believe a ,lot of more details and more study could have been done if met with the dealers personally and on a regular basis.

SOME ARTICLES….

Future OutlookThe apparent estimated domestic demand of gypsum is

estimated at 5.66 million tonnes by 2014-15 and 8.71 million tonnes by 2019-20 at a 9% growth rate.

India's main focus is the creation of more infrastructure with a view to infuse momentum in its economy and participation in its industrial development. These activities will keep the cement industry to grow and accordingly, the consumption of gypsum will increase.

Production of gypsum wallboard in India is negligible. Its light weight and other special characteristics could facilitate its utility as a light weight and attractive partition material that is increasingly used in high rise buildings.

BIBLIOGRAPHYwww. Saint-Gobain gyproc.comBusiness today.63rd Annual Report , 2012-13The Economic Times.Principles of Marketing – Philip Kotler.Marketing Research – N. K. Malhotra.www.google.comHandout provided by Jaideep Sir.

http://www.unitedworld.edu.in/CampusAhmedabad Campus: Karnavati Knowledge Village, A/907,Uvarsad, S.G.Highway, Gandhinagar

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