Lanka Floortiles invests for expansion

Lanka Floortiles PLC is continually pursing new markets and segments where its high quality tiles are in demand. According to Lanka

Floortiles PLC annual report 2011/2012 the company has invested Rs 874 million in the year under review to upgrade the manufacturing capabilities which included a new expansion project costing Rs 600 million to increase capacity by 40%.

The company has the capability to add 2 million SqMt of tiles per annum with this new capacity expansion and this will help to increase the market share of the company by countering the imported product. The company is committed to further invest in the manufacturing plant to improve productivity and deliver consistent production. However the company's entire operations has been affected due to many challenges both on the global and domestic fronts. With low economic growth coupled with the decline in low consumption in leading markets such as China and India also had an impact on exports declining.

The report revealed that the market for floor tiles in Sri Lanka is estimated at Rs15 million SqMts, growing at 10% annually.

Imports service approximately 50 % of the market with LFPLC's share of the market is estimated at 23 %. Floortiles importers also constitute part of the market bringing in tiles from low-cost destinations such as China, Indonesia and India. The industry saw a general increase in volume because of macro-economic conditions of GDP growth and low inflation, which led to improved investor confidence and increased construction activity in the country.

(IH)