Updates from Rubber Expo 2013

Indian Rubber & Tyre show is being conducted in Bombay Exhibition Center (BEC) from 22-24th Jan, 2013.

Since, it is being conducted in BEC ( Owned by NESCO) and GRP has a stall in it, i thought it would be a good idea to do a visit here.

Updates from the visit are given below:

GRP & Industry::

1. Overall demand situation is not great,  but company is somewhat insulated as 70% of their sales are with Tyre Companies
2. Focus is now on Asia & Indian markets, and company is trying to make players aware of the products launched by them
3. Company was surprised to see 7-8 new competitors, although all seem to be of small scale. Also, according to marketing manager, it is difficult to break existing clients as testing process of reclaimed rubber is around 1-1.5 years
4. Brand name of the company is very well established, so participation is more of a showcase event
5. There was very low participation from European companies which are usually present in large numbers, but a lot of Chinese players were present. Also, a very active stall was from Srilanka.
6. Not much info on thermoplastics, apart from the fact that they are starting to get good response. Saw leaflets of these products.
7. Most of the products were either rubber compounds or products related to synthetic rubber. 
8. On tyre section, very small showcase, mostly from known players like CEAT, BKT etc
9. Overall felt that the reaction to show was quite Tepid, with low footfalls and not much hustle. Maybe it could be because i went at around 11 am :)

NESCO:

1. Company seems to be chugging along. IT Building- 4 is ready and is around 15-20 storeys I think. External work and lobby work is still in progress
2. Also, saw starting of levelling and digging in few land patches, so maybe company has already set plans for another building
3. Companies like SERCO, Citibank etc currently occupy halls, which are double storey. In case NESCO is able to get more FSI on these halls, they can also be converted into mutli-storey towers.
4. It is fair to assume, that NESCO is not a valuation mismatch story, as from ground it seems company has no plans to sell its land. It thus, can be a growth story with lumpy revenue jumps basis sale/rental of additional office space and hence critical to have a view of 3-5 years here

cheers,

Saurabh

PS- Invested in both GRP and NESCO

PPS- If any one else has visited the exhibition do share your comments.