PUNE, February 5: With Thermax Culligan Water Technologies Ltd's (TCWTL) February 11 launch of its 20-litre branded bottled water `Good Water' in Mumbai, the joint venture is set to enter the lucrative and growing consumer water segment.TCWTL chief executive officer (CEO) RA Venkatachalam said the company had identified three segments created into three strategic business units (SBUs) to cater to the potable water needs of each specific market. The SBUs are standard (or industrial use), which were earlier with Thermax Ltd and have now moved to the joint venture; household and commercial and bottled water.
Good Water also will be introduced a fortnight later in Pune and then in Surat. The 9,000-litre per hour bottling plant at Taloja will be inaugurated on February 10 by Thermax chairperson Anu Aga.
TCWTL will set up a maximum of two dedicated bottling plants to serve the markets in metros and large cities during 1998-99. Among the areas it is eying are Gujarat and southern India, although locationshave not yet been finalised. During 1999-2000, TCTWL will set up two more plants.
The company may adopt options which include setting up its own plants through acquisition of existing ones, entering into franchise arrangements or through forming a partnership.
Venkatachalam expressed reservations about a franchise operation, pointing to the sensitive nature of the product, indicating that the other options could be adopted for future growth.
While the product roll-out for the bottled water would be complete by March, that of the household and commercial segments would be done by the middle of the year. Venkatachalam was confident that all the SBUs would be operational in the next six months to give a turnover in 1998-99 of about Rs 40 crore, which is expected go up to about Rs 85 crore by the third year of operations.
In an innovative move, TCWTL will also introduce water-vending machines which will be located at public places like railway and bus stations, cinema theatres and marriage halls.Venkatachalam said that these vending machines would be manually operated with a person supervising to avoid tampering.
All the products would be marketed directly. Sales teams have been appointed in Mumbai and Pune for the household and bottled water businesses. The teams for Surat for bottled water would be appointed shortly. However, the distribution networks for all three businesses will be different.
Currently, TCWTL is in talks with select kitchen equipment suppliers and food and beverage majors for a tie-up for its household and commercial range. Venkatachalam said that they would take a final decision in another three months. It has already tied up with Coca Cola, Pepsi and Macdonald's for their water requirements. The 50:50 joint venture has an equity capital base of Rs 14 crore and began operations in 1997.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
