Chairman's Desk
Dear Stakeholders,
As Flair launches its inaugural Annual Report following our recent IPO,
I extend my heartfelt gratitude to each of you. Together, we eagerly anticipate further
collaboration, striving to elevate our performance and reach new horizons.
LEVERAGING LEGACY TO NEW HORIZONS
Our flagship brand, 'Flair,' has etched its mark in the writing
instruments industry, becoming a household name synonymous with quality and reliability.
For nearly 5 decades, Flair has been a trusted companion to students, professionals, and
offices alike, catering to their diverse writing needs across various price points.
We stand at the cusp of a new era, poised to leverage our legacy and
embark on a transformative path towards new horizons. Our commitment to innovation and
strategic diversification has paved the way for us to foray into the manufacturing of
steel bottles and houseware products. This move is a testament to our vision of catering
to a wider customer base and solidifying our position as an industry leader. As we embrace
these new horizons, we remain focussed on our commitment to upholding the values that have
defined our success - quality, innovation, and customer satisfaction. Our legacy serves as
a
solid foundation upon which we shall build, infusing our new ventures
with the same passion, dedication, and excellence that have made Flair a household name.
By capitalising on our brand visibility, extensive distribution network, and robust
manufacturing capabilities, we are confident in our ability to navigate these new waters
successfully.
MACROECONOMIC OVERVIEW
In CY 2023, the global economy grew at 3.2% and is projected to sustain
this pace for CY 2024 and CY 2025. This forecast is lower than the historical annual
average of 3.8% from 2000-19. The situation in the Red Sea remains a challenge. The
precarious situation in the Red Sea led to the rerouting of ships around the Cape of Good
Hope, resulting in a reduction of shipping capacity and rising transport costs. As
economies navigate these challenges, it is crucial to maintain a balanced approach, foster
investment and innovation, and encourage strategic collaborations. These steps will prove
crucial for sustaining momentum and unlocking long-term sustainable growth opportunities.
The Indian economy closed 2023-24 on a strong note, surpassing market
expectations despite external headwinds. The GDP number for the March quarter is expected
to be better
than anticipated at 6.8%, potentially leading to a full-year 2023-24
growth of 8.2%. The domestic industrial and service sectors are performing well, backed by
brisk demand and partially by tentative external demand. Domestic manufacturing is likely
to receive stronger external support in the upcoming months. With increasing sentiments
and improving economic activity in Europe and the US, their focus is on
reindustrialisation and supply chain resilience, which could benefit India's manufacturing
firms as part of the 'China+1' strategy. The Government's flagship programme, 'Make in
India,' aims to encourage local manufacturing and promote exports.
THE GROWING STATIONERY AND WRITING INDUSTRY
From a global perspective, the industry's allure becomes even more
apparent. With a worldwide market dominated by the US with a one-third share, growth
currents in the industry have been flowing towards Asian countries such as China, Japan,
India, and South Korea. India, in particular, emerges as a compelling industry
environment, fuelled by its demographic advantages, increasing ownership of stationery
products per person, a shift in consumer preference towards innovative and creative
products, a penchant for premium stationery gifting items, personalised stationery, and
the burgeoning trend of corporate gifting.
>India's stationery and art materials industry is experiencing a vibrant
renaissance, driven by a confluence of demographic tailwinds, an increasing emphasis on
literacy and education, and a conducive policy environment. Indian manufacturers often
emphasise on attention to detail, craftsmanship, and quality control in their production
processes. This focus allows them to cater to customers that value high-quality stationery
products.
OUR OPERATIONAL EXCELLENCE AND GROWTH
We have witnessed significant growth in our revenue from our own brand
sales. This is further driven by double-digit growth in the domestic market and strong
volume growth. Continuous innovation, category expansion, and product deepening have been
the cornerstone of our strategy, leading to the introduction of over 135 new products in
2023-24, marking the biggest portfolio increase since 2021. To support this growth, we
have expanded our distribution network by adding 11 new super stockists during the year,
bringing the total count to 156. Additionally, we have strengthened our sales and
marketing team by adding 36 new employees and increasing the team strength to 942 people.
We are well-positioned to meet the evolving needs of our customers and enhance our market
presence.
INNOVATIVE BRAND EVOLUTION
Over five decades in the writing instruments industry, Flair has
cultivated a portfolio of iconic brands that resonate deeply with consumers across all
price segments. Our focus on innovation and quality has made brands like Hauser a
household name, while premium offerings like Pierre Cardin allows us to capture the
high-end market and drive our premiumisation strategy. Flair Creative is our gateway into
the vast stationery and art supplies market, leveraging our distribution network to expand
beyond traditional writing instruments. ZOOX represents our commitment to innovation,
appealing to younger, tech- savvy consumers. Our recent collaboration with Disney for our
Creative range is a testament to our brand strength and vision. By associating with
globally recognised characters, we are creating experiences that resonate with the young
generation, fostering brand loyalty from an early age. Our brands are more than just
products, they are the ambassadors of our vision to inspire and empower through writing.
FUTURE PROSPECTS
Looking ahead, we remain optimistic about our future prospects, buoyed
by the faster growth in Flair's creative and steel bottle segments, while the pen segment
maintains steady growth. We are actively pursuing premiumisation efforts, which have
yielded consistent growth in price realisation. Exploring new partnerships, export
horizons, categories, and price segments, as well as consistently evolving our product
portfolio, will help us capture new market share while retaining the Company's existing
share in the writing and creative industry. We are well-positioned to capitalise on the
demand opportunity for steel bottles in the domestic market, having received a BIS license
and are planning to introduce our products through modern trade channels. Looking ahead,
we remain positive about maintaining targets and aim for doubledigit growth, especially in
the creative and writing instruments categories, in the years to come.
EXPRESSION OF GRATITUDE
I am profoundly grateful for the dedication and commitment of our team
members, whose tireless efforts have propelled us to achieve these milestones. I extend my
heartfelt appreciation to our valued shareholders, customers, and partners for their
continued trust and support. It is through our collaborative spirit that we have unlocked
new opportunities. As we embark on this transformative journey, I am confident that
together we will soar to greater heights, creating lasting value for all our stakeholders.
Thank you,
Khubilal Jugraj Rathod
Chairman