Mr. Suresh Garg, Managing Director, Garg Inox Ltd.

Commenting on the factor behind the tremendous growth from Rs. 1 crore in 1996 to Rs. 400 crores presently, Mr. Suresh Garg, Managing Director, Garg Inox Ltd said “Madness is required and aggression is needed and that’s what we did”. He joined his family trading business in 1992, but still his thinking was to get in to manufacturing and do business with the whole world. In 1996 put up a small facility in Bahadur-garh to produce wires. Under his vibrant leadership the company has grown phenomenally with a vast experience in this sector, committed to excellence, challenging new boundaries. With the current ratio of 60% exports and 40% domestic supply the company is eyeing on the Rs. 1000 crores turnover in next 2-3 years. They are a government certified export house, having sales offices in USA, UK and Turkey. Taking the interaction further he highlighted about his manufacturing facilities, philosophies, strategic moves, mission & vision, future plans, challenges faced etc. Excerpts:

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Manufacturing Facilities & Technological Setup

Garg Inox is an ISO 9001 certified company with production capacity of 4000 MTPM (metric tonnes per month) with three units in Bahadurgarh (Haryana) and one in Pune (Maharashtra). In the coming time the existing capacity will be increased to 5000 MTPM as few machines are in line and will arrive by the end of this current quarter. The expanded capacity will be composed of Bright Bars – 1500 MTPM, SS Wire – 1000 MTPM, High Carbonate & Low Carbonate Galvanized Wire – 2000 MTPM and 500 MTPM of different products like Aluminum, Copper, Zinc etc.

On the technology front the machineries are primarily composed of indigenous, Chinese and European technologies and some are developed in house by qualified people. We have adopted 5s Kaizen system for the smooth and integrated work flow. For quality control a testing lab has been set up to check physical and mechanical properties.

Philosophy at Garg Inox

We believe in good quality, timely delivery and fulfillment of commitment. We don’t work on short term basis; we work for long term relationship. Continuous development of products and market, hiring good people are the pillars of our success. If sometime we lose money we don’t care but we believe in long term relations.

R&D Activities

Basically, it starts from a customer, whether it is R&D or product development. We have been travelling a lot; visiting new customers to understand their process and product applications, which help us to develop new products. We also visit existing customers to understand their problem which drives our R&D efforts. Years of experience enable our engineers, designers, tool makers, technicians, machining and production staff to offer the innovative advice to shape the best possible solutions.

Major Landmarks during the journey

In 1996 we started our manufacturing facility under the name Garg Sales Company Pvt. ltd. which was used to be the trading firm run by my family. Due to this name it was very tough to convince our customers that we are a manufacturing firm and not a trading firm. Finally in 2004-05 we decided to rechristen our company to Garg Inox to co-relate to our business activity and in fact Inox in French means stainless steel.

Around 2006 we started facing problem in customer deliveries and the cost was going high. So we decided to start an additional plant in Pune, dedicated only for exports as it is very close to the port. To tackle the delivery & raw material concerns and to reduce our input cost it was a calculated move.

Our future expansions would primarily come where the market lies like expansion in bright bars is being done at Pune likewise for wires Haryana is the best location, as there are many automobile companies and other consumers. We strongly feel that manufacturing has to be done only in India as the infrastructure and the running cost is less and can be controlled.

Value addition is an important aspect and to ensure this we go as per customer requirements, like if you make wire as per their desire, do packing as per their specification and give good commitment then you can add at least 5% to the normal profit and this is the only way to make the customer satisfied.

We started production in 1996 and were catering to domestic market only. In 2000, we did our first export to Russia, which was a good experience and after that we never looked back. Then we went to USA and found that it is not possible to export directly, so we started an office in USA in 2002. In 2004 our UK office was established which is taking care of European market. Over a period of time we appointed agents in France, Germany, Turkey etc.

Challenges Faced

The biggest challenge in my career was in 1996 when we started the production – at the time selling the product was tough. It was the worst time for the industry as well, 7-8 plants came within 6 months and all of them were desperate to sell at whatever prices and payment terms. From 1996 to 2000 was a bad phase because that time we were learning the market dynamics and working hard to develop our reputation.

Besides, tapping international market was tough and it took us almost 2 years to get the initial customers. I was travelling a lot, working hard with no outcome. We were not a known company; people were not interested to work with us.

Future Plans

We are looking forward to achieve Rs. 1000 crores turnover in coming 2-3 years. Till date capital investment and the infrastructure has been created to the achieve turnover of Rs. 700 crores. We intend to introduce new products with value addition. The market is to be explored and the product has to be qualified, so it will take another 1-1½ year.

We are also concentrating on getting the end products for the wire, so rather than selling wire, we are planning to sell end product in order to expand the market. Planning has been done for forward integration as we have already started making welding electrode. It will help us to cut down on the middle men and add around 10% to our bottom line. Besides this, we are working towards developing untapped overseas market for which we are hiring people there, talking to agencies etc.

Views on the Indian wire industry

Globally the scope is good and future seems to be bright. But in the Indian context we don’t find it very interesting because the new players are coming and that too in unorganized sector. They save on taxation and use unfair practice that’s why they can sell their products at lower price. At the end of the day nobody is benefitted and an unnecessary competition is being created.

Plans for coming Wire Shows

In Elecrama, we would like to develop the market for our 2 wires i.e. copper clad aluminium wire and aluminium alloy wire that are being used in electrical cables. Further going ahead we are participating in Wire Dusseldorf and Interwire to meet our existing customers and to look out for new one.