Banks\' consolidation impacts the growth of Godrej Security Solutions

Banks' consolidation impacts the growth of Godrej Security Solutions

"Our revenue in FY18 was Rs 540 crore which grew to Rs 600 crore in FY19. We expect to generate about Rs 740 crore in FY20," said Pithawalla.Ankit Sharma  |  ETRealty  |  Updated: September 04, 2019, 18:51 IST
Banks' consolidation impacts the growth of Godrej Security Solutions NEW DELHI: Godrej Security Solutions expects a growth of about 23 per cent in the financial year 2020, said Mehernosh B Pithawalla, vice president & global head (marketing sales and innovation) of the company. It witnessed a growth of 11 per cent in FY19.

"Our revenue in FY18 was Rs 540 crore which grew to Rs 600 crore in FY19. We expect to generate about Rs 740 crore in FY20," said Pithawalla.

According to him, the major reason behind the slow growth is the consolidation that has happened in the public sector banks. The company used to generate a revenue of Rs 400-420 crore from the bank-products. "Because of the consolidation demand from banks for our products has dipped. We are not expecting a demand revival from the banks for some time," added Pithawalla.

Now, the company is now majorly focusing on the retail segment. "Few years back the penetration of home lockers was mere 1 per cent which is now 7 per cent. Hence we feel that the retail segment has lot of scope and will grow significantly in coming years," said Pithawalla.

Currently, the home lockers segment generates a revenue of Rs 140 crore while the home security solutions segment adds another Rs 40-60 crore. "We are expecting a 25% increase in the revenue from home lockers segment in FY20," said Pithawalla.

Currently about 60 per cent of the demand for home lockers come from urban areas while 40 per cent comes from rural regions. Mumbai and Delhi are two major city where it gets majority of its demand from.

Godrej Security Solutions claims to hold about 80 per cent market share in the home lockers segment and 70 per cent market share in the commercial security solutions segment. Commercial segment generates a revenue of Rs 280 crore for the company as of now.

It also plans to increase its outlets in Delhi for home lockers from 350 to 450 by the end of FY20. Across India, it plans to increase its outlets from 8,000 to 10,000 during the same period.

As of now, the company's production capacity for safes is three lakh per year which it plans to grow by 20-25% by the next year.

Going forward, the company plans to focus on electronic software solutions and artificial intelligence. "We have developed our own software for face recognition among other features which will enhance our security solution products, said Pithawalla.

The company will invest Rs 50 crore in research and development and Rs 50 crore in marketing in the next two years.