Power shortage in Tamil Nadu is concern: TTK Prestige

TTK Prestige, which is considered market leader in southern states, is concerned about power shortage, specifically in Tamil Nadu.

Though the firm has reported over 42 percent year-on-year jump in Q4FY13 net profit, it believes it can do even better if not for its south division’s poor performance.

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In an interview with CNBC-TV18, TT Jagannathan, chairman said, he cannot predict recovery in south market unless power issue is resolved. He also mentioned about power shortage problems coming up in Uttar Pradesh and Andhra Pradesh.

Below is the edited transcript of Jagannathan's interview to CNBC-TV18.

Q: Would you say that the strength in your numbers is largely on account of the non- southern markets with Tamil Nadu being a bit of a drag now?
A: Absolutely. It is completely a non-south phenomenon. Tamil Nadu continues to be a big drag. Q: Given the growth we have seen and that is across all three segments what could you point to in terms of where you think sales could move over the next couple of quarters?
A: I cannot predict that at all. It all depends upon how the power situation in Tamil Nadu and Kerala improves. Also rest of the states like Uttar Pradesh and Andhra Pradesh are also suffering enormous power shortages so we are not able to predict what can happen till government gives us some guidance. Q: Would you say that there is some elbow room because of how robust sales still are in terms of increasing prices for you and hence helping enhance your margins?
A: The non-south sales are very robust. Infact, the first four-and-half months of this year the non-south sales grew very nicely but the south is still very depressed. So, we really cannot predict what is going to happen till we understand the power situation in the south. Q: Which are the markets which are delivering the highest growth for you and where you have been able to garner additional market share from Hawkins?
A: We gained the market share from the market and the best states for growth are UP, Madhya Pradesh, Chhattisgarh, Maharashtra and West Bengal. Q: How long do you see the problems of the south persisting? From your discussions with people in the market there do you think it will continue to linger for another quarter or two?
A: I really cannot tell. That needs to be asked to the government. Q: In the branded market, where is it that TTK has managed to get its market share to and are their targets that you have set for the next year?
A: In the pressure cooker segment , we want to achieve a target of 45 percent and we are nearly there. In cookware, we have a target of 50 percent and we are nearly there. We have very small market share percentages in the other markets are all. I believe that we will be able to maintain our market share. Q: Is growth plateauing off in the induction cook top market or are you continuing to grow at the scorching pace that you were over last couple of quarters?
A: Again, it is all south dependent. If south power situation does not improve, growth will reduce.