Alstone International is one the lead brands in Indian Aluminium Composite Panel industry, which has been credited to bring number of innovations in this sector. The company has 2 manufacturing lines, 15 warehousecum-offices, and about 150 dealerdistributors network pan India. Besides, Alstonehas expanded its market in SAARC countries as well. Under the guidance of Mr. Pawan Garg, Alstone ACP has been maintaining its growth year on year. In Covid Era, where everyone is struggling to sustain, what does Mr. Garg foresee the future, he speaks with The Ply Reporter, which is worth read.
According to International Monetary Fund (IMF), there will be an estimated cumulative loss of US$ 9 trillion in the global economy for the year 2020 and 2021, a key indicator that signposts huge impact on the growth of the major end-use industries including building & construction and recreational vehicles.
Q: - How was the business scenario of the ACP industry during the last 100 days (till30th June) ?
Initially when Government called for complete lockdown, there was no business for initial 30 days. The movement of materials and people, by and large came to an abrupt standstill. From the mid of second phase of lockdown, supply chain material disruptions occurred, as several states in India were under lockdown with intermittent relaxations in place.
The industry was already experiencing slow movements in pre-corona times due to stagnating economy and dull market demand. It was also supported by disruption of international supply chains due to the wuhan and lockdown in China. Migrant workers, particularly semi and unskilled workers, returned in large numbers to their hometowns. With the slowdown in world economic growth, the Aluminium Composite Panel industry has suffered a certain impact, but still maintained a relatively good flow and optimism for growth.
Q: How much losses are estimated to have been incurred by this sector tentatively and How do you expect the recovery by 31st March, 21?
A::There has been a substantial amount of loss by the top 10 Companies in the sector. It is difficult to state when the impact of the pandemic starts to fade away. However, it is predicted that the demand would stabilize in 2021. Further, it is anticipated that the market will gradually recover from 2022 onwards following a similar trendline registered during the great recession; however, the recovery may take a longer time than during that time.
According to International Monetary Fund (IMF), there will be an estimated cumulative loss of US$ 9 trillion in the global economy for the year 2020 and 2021, a key indicator that signposts huge impact on the growth of the major end-use industries including building & construction and recreational vehicles.In my opinion it is expected to be recovered in coming 6 months.
Q: What opportunities did you see during this period for your business?
A: Opportunity lies in MAKE IN INDIA and AtmaNirbhar Bharat, which can give us boost in coming days. There are opportunities in various field with growing preference for local product due to Indo-China border tensions. As an individual I have been exploring many areas and there are plenty of opportunities for a hardworking and focused person.
Q: It is said that Government projects would be the saviourfor the ACP sector demand as commercial and hospitality is badly hit, what do you view?
A: In my opinion, Retail is the core for whole industry. As we could see in last 2 months, all projects, whether Government or Private, are moving at snail’s pace. I expect to get thebusiness from them only after 6 to 12 months. I think, the present problem is a global phenomenon and if somewhere we see the light and hope, Indian market will be first to glow and enlighted.
Q: It also seems that economical products may get takers, what would be the scenario in the ACP sector?
A: Earlier, quality product used to dominate the market up to 70% of the market size. But during last 2 years the trend has changed towards Economical and cheaper grades. In current scenario, the market is almost 70% for the economical grade ACP and until there is a return of normalcy, we have to deal with more preference to economy grade aluminum composite materials.
Q: ACP made Cladding also known as HPL planks havewitnessed a decent growth in last four years, how do you see this product demand post Covid?
A: We don’t see a very big surge in sales for any of the products in façade. So it would be similar to ACP and witness a slowdown till covid fear disappears.
Q: Payments, funds and cash flow are the biggest worry now, what is your view?
A: The most immediate concerns currently on the minds of manufacturers are cash flow and working capital. Some believe that a financial stimulus will be enough, but others are recognizing that COVID-19 is a wakeup call to change and improve different aspects of operations as well as the ecosystem and the value chains in which they participate.
When restrictions are lifted, the market is expected to be very tight and extremely cash-constrained. This is largely due to extreme uncertainties with regard to demand (and/or ability to deliver products to the market) and consequent low or non-existing business income.
The Distributors/Dealers with long term vision and honest from heart were honoring their commitments even during lockdown but some of them who were in excuse mode earlier have further increased their excuse zone. In my opinion, market will be normal by end of September.
The Distributors/ Dealers with long term vision and honest from heart were honoring their commitments even during lockdown but some of them who were in excuse mode earlier have further increased their excuse zone.
Q: How does the anti-China wave impact on ACP manufacturing because India imports major raw materials from China?
A: In coming days you will see a few companies who will be planning to put Coil Coating Line in India to reduce the dependence of import from China.Alsothere will some shortage and delay in raw material deliveries and supply chain but it will open new ways for domestic players for sure.
Q: With so many constraints such as high input cost, high dollar, less productivity etc, do you see price rise in ACP products, if yes how much and how ACP sector would be able toimplement?
A:Against the production, unless the demand is less than 50%, we don’t see our industry thinking about increase in prices.
Q:There is a rise in demand of Anti-bacterial, Anti-virus products in present time, does your product qualify these properties, or do you see new application of ACP in such scenario?
A: We are planning and preparing this product. We will be ready with the product in coming 2 months.