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Funskool bets on toy exports, plans foldable table for kid

Thursday - July 9, 2020 3:44 pm , Category : BUSINESS
Chennai, July 9 (IANS) Indian toy major Funskool (India) Ltd hoping to increase its toy exports during the current year will soon be launching a foldable wooden table which would be a child's own workstation, said a top company official.
"The new product will be available on online markets like Amazon and others and will be priced at Rs 3,499. It will be an all wood foldable table," R. Jeswant, CEO told IANS
Started as a joint venture between Indian tyre major MRF Ltd and Hasbro Inc, USA in 1987, the Indian promoter and associates bought out the American company's stakes.
Closing last fiscal with a turnover of about Rs 200 crore the company hopes to maintain similar level sales this fiscal owing to the Covid-19 lockdown impact.
Last year the company's export revenue was about 50 per cent of the total and this year it may be higher as the company is getting more enquiries.

"Normally April and May are the months when most of the sales happen. But this year it did not happen as factories and retail outlets were closed due to Covid-19 lockdown. In May the stores were open and there were lot of buying of board games. India is not a puzzle game country," Jeswant said.
Though the Covid-19 had impacted export shipments as well, Jeswant is of the view that it would go up as there are increased number of sourcing enquiries from MNC toy makers.
With two plants in Ranipet in Tamil Nadu and one in Goa, the company makes and sells toys under its own brand and also that of multinational companies (MNC) from different countries under licence.
The company ships out toys to regions in the Middles East, Africa, UK, USA and others. Funskool does OEM production for companies like Spinmaster, Hasbro, Early Learning Centre and many other European companies.
According to Jeswant, India is a suitable manufacturing destination for big toy multinationals as they are looking out to diversify their production base.
Toys made by organised players are of different kinds - plastic moulded, board games, puzzles, wood toys and others.
Jeswant said the global toy industry is estimated to be around $90 billion and the Indian market -- toys sold in retail outlets excluding those sold on pavements, temple and other fairs -- is about Rs 3,500 crore or $450 million.
"With a huge population of children between 0-12, India offers good potential for the toy industry's growth. Further, the current young parents were the ones who had first experienced toys made by organised players like Funskool," Jeswant said.
On the impact of digital games on toy sales Jeswant remarked that the global toy market is more or less flat but the market for board games have not gone down with the advent of digital games. There will be demand for traditional toys.
Queried about the 'Boycott China' sentiment in the country and its positive impact for the Indian toy makers Jeswant said after the Covid-19 pandemic, the enquiries for sourcing toys from foreign companies have gone up.
"They want to spread out their sourcing. There are indications of companies planning to locate their manufacturing plant in India," he added.
While India can make toys for the world there are several challenges that the industry players have to cross first.
"Firstly, the Indian market is small whereas the investment to be made in tooling, moulds and other items are huge and it would take a longer time to recover the investment," he said.
"The government policy should also be tuned towards promoting the domestic toy industry. It is true the government increased the import duty to 60 per cent from the earlier 23 per cent. But there is this Asian Pacific Trade Agreement. The toys imported from the countries that have signed the agreement are subjected to a duty of about 30 per cent," Jeswant added.
Apart from lower end toys from China, there are global players who also get their toys made in China and sell them in India. However, the largest segment will be cheap toys that are sold in small outlets and pavements.
"Nearly 75 per cent of the organised toy market may be catered by imports. There are no authentic numbers as to the volume of imports. Out of the total imports, Chinese may account for nearly 65 per cent. China supplies generic toys to the global markets. Toys with lot of electronic contents are also imported from China," he added.
He declined to comment when queried about Chinese investments in the Indian toy sector.

--IANS vj/rs/