hile working as a building consultant, G N Naidu, chairman and managing director of Regency Ceramics Limited, got the idea of starting his own company by providing a different type of flooring material.
"While I was a consultant, I got acquainted with the materials that were required for construction and also used to read a lot of foreign magazines in the office. In one of the editions, I noticed the flooring material they used was totally different from what we have in India. That is how I got the idea of starting a company," he recalls.
After discussing with other companies that produced ceramic wall tiles, he found there was no company in the country which manufactured ceramic floor tiles though the required raw materials were available in India.
~ The first step: Get the infrastructure
Naidu set about getting information on various foreign suppliers and manufacturers and visited their facilities in 1983. A week after he returned, he finalised the company from where he could get the equipment and the technology. "I decided to go in for Welko, an Italian company," he says.
Initially, he chose to set up the factory at Sangareddy in Medak district [Andhra Pradesh]. But the lieutenant governor of Pondicherry, whom he once met, offered some incentives and convinced him to start the unit in Yanam [Pondicherry].
"Apart from the incentives, Yanam also provides few raw materials like sea sand. So, in 1984, with an investment of Rs 12 crore (Rs 120 million = Rs 80 million debt and Rs 40 million equity), the company started with a production capacity of 4,000 square metres per day," recalls Naidu.
The company started operations towards the end of 1985.
In May 1986, it was declared a 100 percent export-oriented unit.
At the time, Regency exported predominantly to the Middle East and Southeast Asian countries.
According to Naidu, the cost was around $ 8 (Rs 349) per square metre when commercial production started, because European companies also started exporting to these countries.
"This was a difficult time for the company as the stock was piling up. When we approached the Union government to debond the unit in 1987, they agreed. But they said 35 percent of the production must be exported," he said.
~ Look for new opportunities
After this, the company looked at new export opportunities.
In 1992, it started exporting to Russia. This was when the company expanded its facility by another 3,000 square metres per day.
The company now has a production facility of 70,000 square metres per day.
Regency has set itself an export target of Rs 500 million this fiscal year, compared to Rs 370 million earned last fiscal.
The company also expects a 20 percent growth in turnover to Rs 2.5 billion this fiscal.
But for the 64-year-old entrepreneur who hails from Kamapalli in Kadapa district [Andhra Pradesh], more than his achievements as an industrialist, it is the activities to help the society that interest him more.
"When I had set up the unit in Yanam, it did not have even a basic school. So we decided to provide the necessary infrastructure such as primary education initially," he said.
~ Diversify, giving back to society
In 1987, the company started a school. Two years later, it started a junior college.
Today, it has an engineering college too.
"We plan to start a software technology park, which would help engineering college students get hands-on experience, and a medical college. We have just got a no-objection certificate for the same," Naidu says.
Another concept the company started three years ago was to terminate the employment of any employee who took dowry.
"In 2002, my general manager came to me saying somebody wanted an advance to pay as dowry for her marriage. After sitting on the file for two days, I decided any employee of my company taking or seeking dowry would be taken off the company rolls," he says.
According to Naidu, the company also plans to set up a small power plant which would cater to the needs of the people of Yanam.
In his free time, Naidu likes to read about the industry and play with his four grandchildren.
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