Fancy the new idols of T20 series? The exercise book makers of India, quick to spot a business opportunity, are rushing to put them on the covers so that kids can continue to admire them even when they are not glued to the television.
“Notebook designs change with the times. Since T20 is the flavour of the season, we’ll put the T20 heroes on our cover along with some information on the new game format,” says Amrut Shah, Chairman and Managing Director of Sundaram Multipap Limited, makers of the popular Sundaram brand of exercise books in Maharashtra, Gujarat and Goa.
A few years ago, as the fag end of the summer vacations, it was routine to cover the textbooks and notebooks with brown paper and write names on them. Quality notebooks, that are colourful, have made this a more or less redundant exercise.
Some schools like Arya Vidya Mandir in Mumbai, select a painting by their student to put on the school exercise books. This year, for instance, there is a design by Soumya Mahuvakar of Standard VII, AVM, Juhu with a message “Spread flowers on the way, not thorns”.
According to a study by AC Nielsen, the stationery market is estimated at Rs 10 billion per annum in India and is growing at 20% every year. Of this, the notebook market accounts for around Rs 5108 crores. Nearly 80% of this huge market is in the unorganised sector with local players catering to the local demand. Given India’s relative prosperity and heightened quality awareness, organised players are increasing their presence as they see a bright future ahead.
Says Amrut Shah, also the general secretary, Maharashtra Book Manufacturers’ Association, “With an estimated 22 crore students in India, the school paper stationery is nearly Rs 9,000 crore business. It is growing at 15 per cent per annum.” The 11th Planning Commission has provided for Rs 55, 000 crore to be spent on education till 2012 which will encourage sale of school stationery, he says.
One look at the notebooks on offer in the stationery shops and you know why exercise book manufacturers are falling over each other to come up with new designs. They have it all — from pictures of fancy cars and motorcycles to wildlife and nature themes.
Shah who had Hrithik Roshan on one of the covers of Sundaram notebooks, admits that star power helps in the initial years of brand building. “In the last five years or so, buyers have become quality conscious. Whether you put Mickey Mouse or Bill Gates on the cover, it matters little to them,” he says. Quality is also the reason why, explains Shah, there is no invasion of Chinese notebooks in India. Chinese made pencils and sharpeners and other products may rule in Indian gray market but not the notebooks.
Indian market, though huge, is not the only lucrative market for exercise book manufacturers. These notebooks, very competitive for their price and quality, are much in demand in the United States, Europe, Africa and the Middle East.
America was a major export destination for Indian notebook manufacturers till two years ago when it introduced the anti-dumping duty against India, China and Indonesia. For companies like Navneet, for whom US market accounted for 50 per cent of their total exports, it was a blow. “We made good by concentrating on the European market with value-added children’s book series like model-construction and fabrication books,” says Shailendra Gala, vice president stationery division, Navneet Publications (India) Limited , a family-owned business with an annual turnover of Rs 400 crore. Paper stationery division of notebooks account for one third of their annual turnover. Says Nitin Sontakke, CEO of Blue Bird Limited, a Pune-based company with emphasis on school stationery, “Educational sector is the biggest growing sector worldwide. India manufactures good quality paper and exports paper-based stationery to many countries in European Union and African countries like Tanzania and Kenya.”
But all is not well with the paper industry, admits Shah. Price of paper, the main component for the notebooks has increased from Rs 1,000 to Rs 3,000 in the last one year and since the prices of notebooks have increased only by 7 to 8 per cent, small paper mills are turning to either making newsprint which fetched good price or to manufacturing higher quality paper for the photocopiers.
These problems not withstanding, Shah is upbeat about the future of the notebook industry. “The UK consumes 200 kg per annum, China uses 40 kg, South East Asia uses 70 to 80 kg. In comparison, India consumes only 8 kg and Africa below one. There is lot of scope of development still,” he says.