Their very name – Pragati – means progress. Making rapid strides in the realm of printing, Pragati put Hyderabad on the global map in its own way, for the world-class printing quality offered by Pragati perched the company many notches above its peers. All big names in the industry are its clients.
Pragati Printers, winner of three SAPPI international awards – what Oscar awards are to film industry are SAPPI awards for printing — is contending for the award for a fourth time this year. P Narendra, CEO of the company, says, “It is the journey towards excellence that drives the company to achieve these awards rather than mere revenues. If the sole aim of the company is to make money, it may not sustain for a long time, but if it strives for quality, it can live forever,”
The company is growing at 12-14 per cent in the domestic business. It has around 400 major clients and gets 66 per cent business from other states. Talking about the company strengths, Narendra said, “Anybody can invest in business and get the best printers from the world like us. The strength of the Pragati is its employees, which sets it apart from others. The motivation levels of human resources of the company are intangible and cannot be simply copied by others.”
Pragati has no plans to diversify into other businesses, but resolved to remain and expand in printing. It is foreseeing 2012 as a tough year for expansion due to euro-zone crisis and recession in the USA. Narendra said, “It is the perception what keeps businesses going, if the world market crushes the repercussions can easily be fe lt here. The businesses here would wait and watch rather than operating aggressively. This may decrease the printing orders for us.”
The per capita paper consumption in India is 8kg against the world average of 54kg. The growing super market and retail culture will drive enormous demands for packaging. The 20 per cent growth rate in the packaging industry would continue and may reach 30 per cent in years to come. However, the future of commercial printing is not up to mark.
There are some industries which are moving out of printing due to electronic processing especially like air tickets, greeting cards and manuals for different products. The commercial printing would grow at five per cent in years to come and becomes stagnant for a certain time before falling down, he said.
Pragati Printers is enjoying 10-12 per cent margins in offset printing and 8-10 per cent in packaging. The company has no plans to go to public issue but ready to partner with global printing companies.
Pragati Printers has won multiple awards globally, but could not continue its success in the offshore businesses for various reasons. Talking about the business in USA, Narendra said the business was quite good till 2008 but is facing a tough time later.
There are no proper logistics to export to USA and the courier charges are prohibitive. The printing machine costs, paper costs, inks and other raw material are expensive in India compared to USA. The interest rates are at 16 per cent in India and whereas they are just two per cent in USA. Even at all these higher input costs, Pragati is trying to compete with global companies.
However, the freight charges have become a tremendous burden on the costs. The majors in USA are not giving jobs to Pragati as it becomes difficult for art directors to supervise the procedure of printing, he said.