Chennai, March 20 (IANS) Targeting 50 per cent of its turnover from overseas, plastic moulded toys major Funskool (India) Ltd on Wednesday commissioned its new unit at Ranipet, said a top company official.
The trade war between the US and China has come as a good opportunity for Indian toy makers with many US companies looking at India as a sourcing base.
“Our exports are on the rise. So we’ve decided to set up a new unit solely for exports at Ranipet with an outlay of Rs 25 crore,” said Funskool (India) CEO John Baby.
“Export orders are catered from our Goa plant. But transporting consignments from Goa to the Mumbai port is difficult. From Ranipet, it is easier to send export shipments to the Chennai port,” said Baby.
Funskool ships out its goods to the US, Africa, Europe and the Gulf countries.
According to Baby, the company may set up another unit to earn 50 per cent of its revenue from exports and Ranipet has sufficient space for that.
The company will be closing this year with a turnover of about Rs 225 crore and export revenue of Rs 60 crore.
“Last year, our turnover was Rs 235 crore and export revenue was Rs 40 crore. The dip in current year’s turnover is due to discontinuation of the distribution agreement with Lego,” Baby said.
He said Funskool manufactures its own toys as well as that of foreign companies under a licencing arrangement.
The CEO said Funskool’s own toys contribute to about 30 per cent of the turnover and the balance is from licenced products and the plan is to increase the former to 50 per cent.
Baby said the domestic toy market is estimated to be about Rs 3,000 crore and 80 per cent of the toys sold here are imported.
He noted that price is an inhibiting factor for a toy buyer as it is a discretionary purchase. “Most toys are bought for gifting and hence there is always a budget constraint,” he said.