JOIN USIn a first in the space, Nagpur-based Spacewood, a manufacturer of home and office furniture, has received foreign direct investment (FDI). Japan’s Sumitomo Forestry has invested between $13 million -$14 million (around Rs 91 crore) in Spacewood for a stake of 26 per cent.
“To my knowledge, this is the first FDI in the furniture manufacturing space in India,” said Kirit Joshi, CEO and co-founder, Spacewood. Sumitomo Forestry is bringing to India its technology of pre-hung doors. “The construction model in India is changing. Developers are promising delivery of properties in short periods of 24 months, which calls for a move beyond conventional construction in furniture also,” he said. “Here is where Sumitomo’s technology will be key.”
Eyes Rs 500 cr revenues
Pre-hung doors come with the frame of the door attached, making it simpler to fit doors in fully constructed walls.The door is made of hollow particle wood and laminated with either plywood, MDF (medium density fibreboard) or laminates, as per the consumer’s requirement. “For a bulk order, each door would come up to a price of Rs 20,000,” said Joshi.
Sumitomo Forestry will be setting up a greenfield facility in Nagpur for manufacture of pre-hung doors, at an investment of Rs 30 crore.
Spacewood, which currently operates in Nagpur, Pune, Mumbai, Delhi, Kolkata, Hyderabad, Chennai, and Bengaluru, supplies home and office furniture to eCommerce sites like Pepperfry, Snapdeal, FabFurnish and Flipkart.
Owing to Sumitomo Forestry’s keen interest in home furniture, Spacewood has created two separate verticals of home furniture and office furniture in its business. “Our revenues are currently at Rs 250 crore for the home furniture business, and Rs 70 crore for the office furniture segment. We plan to hit the Rs 500-crore mark in the next three years,” he said.