Godrej Interio, the furniture arm of Godrej Group, will be investing around Rs 400 crore in the next three years to enhance its production capacity, a company official said.
"We are looking at an overall investment of close to Rs 400 crore in the next three years, with new facilities coming up. We are coming up with a facility at Khalapur to expand our production capacity. The facility will be more for steel furniture and we are already in the process of expanding for mattresses and sofa in Haridwar," Godrej Interio Chief Operating Officer Anil Mathur told PTI.
The commissioning of the plants will start in the middle of the second quarter of the next financial year.
"We are looking at a CAGR of at least 15 per cent for the next five years and the capacities are being added based on the bottlenecks which are there," Mathur added.
This year the company is eyeing a revenue of Rs 2,500 crore at a growth of 18 per cent.
"Our revenue projection for this year is close to Rs 2,500 crore and we are growing at 18 per cent. The revenue last year was Rs 1,920 crore. The growth is coming from metros as well as tier II cities. We are seeing a substantial growth coming from tier II cities," he said.
Branded furniture accounts for a large portion of the company's revenues and Mathur said the company is coming with two different types of furniture, which can be distributed through multi-brand outlets and through various retail outlets.
"The focus is on designing and developing products which are multi-functional and also suiting the changing lifestyles of people," he said.
Godrej Interio, which has 52 company-owned stores, will add another 8-10 stores and Mathur said the company is now working more on a franchisee model.
The company also plans to launch its e-commerce platform by the end of this year.
Furniture is placed under the 28 per cent tax slab in the Goods and Services Tax (GST) regime and the company is trying to hold on to the prices.
"We are holding on to the price and we are absorbing because for us the impact is 2-3 per cent. We are looking at products which are at 2 per cent, how we can absorb those and where the benefit we are accruing is much higher than the impact of GST, we have already started passing the benefit to the customer," he said.
The city-based firm also exports office furniture to the Middle East and is now looking at healthcare and laboratory furniture.
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