As a child, Akuri Srinivas Reddy always cherished the dream of becoming an entrepreneur. Youngest of five siblings and hailing from a middle class farming family of Srinagar village in Dachapally mandal of Guntur district, he came to Hyderabad in 1997 with Rs 500 in hand, in search of a job. After doing menial job at a casting unit for a year and running an STD for a few months, he got a chance to work as a supervisor for a painting contractor. That’s where he found his true calling. “While working there, I sensed a big business opportunity in this space. After working for six months, I established Techno Paints and began taking up painting contracts on my own. We clocked a turnover of Rs 10 lakh in the first year. Our Fortune Group, which has 250 employees now, has an order book of nearly Rs 1,200 crore. I am always passionate about business and that’s what has brought me to where I am today,” Reddy, founder of Fortune Group that undertakes works and markets products under Techno Paints brand, tells Bizz Buzz in an exclusive interaction. Now, his dream is to transform his 25-year-old group into a top building materials company.
How did your entrepreneurial journey begin?
I was not interested in education since childhood. Our brother had small businesses. I was involved in his businesses when I was just 10 years old. Maybe I developed a passion for business because of that involvement. Immediately after completing ITI (Mechanical) at Miryalagudem in Nalgonda district, I came to Hyderabad in 1997 in search of a job. In those days, there were not many job opportunities in the city. I visited many factories in the city, seeking a job. Finally, I got an opportunity to work in a casting unit, Crown Castings, for a monthly salary of Rs 1,250. My duty was to carry sandbags from outside into the factory as sand was used for making moulds.
But I was not satisfied with that job as I wanted to set up my own business. I could hardly work there for a year. Thereafter, I took an STD booth on lease. But that business did not last long thanks to the arrival of mobile phones. Thereafter, I got a chance to work as a supervisor for a painting contractor who was doing painting work for Aurobindo Pharma. While working there, I sensed a business opportunity in this space. I used to closely observe how much amount was being paid to workers and how much painting was being done by each painter each day. After gaining experience for six months, I established Techno Paints in 1998 and started taking up painting contracts. We did a business of Rs 10 lakh in the first year itself. With order flow increasing, we established a paint shop a year later. The idea was to procure paints directly from companies instead of dealers so that we could generate more margins. In 2001, we went on to set up a small paint manufacturing unit in Hyderabad. That was the time when real estate projects started in a big way in the city.
What was the response to the paints manufactured by you at that time?
We expanded our dealer network and appointed 1,500 dealers across undivided Andhra Pradesh to market our products. We had a sales and marketing team of 100 people. Though we established our name in executing painting works, we did not have much experience in sales and marketing of paints. Consequently, we committed some mistakes that cost us dearly. Besides, we stopped taking up painting works and focused only on paint products. The result was that our company incurred losses between 2004 and 2012. I had to sell my assets to clear debts. It was a bad phase. But I again started from the scratch in 2012. As my strength was in executing painting contracts, I re-started taking up painting works, mostly corporate painting contracts. This time, we fine-tuned our strategies by addressing weaknesses. And we never looked back since then.
How many projects did you complete so far?
After the restart, we mostly focused on large corporate painting projects. It is a bit easy to execute large projects as we can deploy employees at a single location for a longer period, thus enhancing productivity. As I had good relations with many builders in Hyderabad, we could secure a large number of orders. Within four years, our company was back on a sound financial track. Subsequently, we expanded operations to other major cities like Mumbai, Bengaluru, Chennai, Pune, Lucknow and Kanpur. So, our order flow has further increased. We always completed projects on time without compromising on quality. That’s our strength. Till date, we executed over 650 painting projects across India.
Recently, you set up a paints manufacturing unit again. How is it doing now?
Yes, we established a paints manufacturing plant at Cheriyal near Hyderabad in 2019. The current capacity of our plant is 1 lakh metric tonnes (MT) per annum. We are planning to double the capacity to 2 lakh MT. We have plans for further expansion as well. We also developed a good Research & Development (R&D) team. With this, we are able to develop, manufacture and supply customised paints now. If someone wants paints with marble finish, we can do it with finesse. We offer over 60 varieties of textures and finishes. We use only our paints while executing the painting contracts we undertake. We developed several designer paints for exterior applications. But, these days, designer finishes are also being used for interior paints. For this, we collaborated with Realto, a 100-year-old Italian company, which is present in 70 countries. They make lime-based products without using any chemicals. These paints, which cost from Rs 150-250 per sqft, are mostly used for heritage buildings and for high-end finishes. As purchasing power increased in India now, people are using them for villas and other residential units here. We will import these paints and market them. Under this partnership, we are also planning showrooms in all metro cities. The first one will soon come up at Hitech City in Hyderabad. We will eventually have 10 such showrooms, each costing around Rs 50 lakh.
How big is your order book now?
At present, we have an order book of Rs 1,200 crore, including ‘Mana Ooru– Mana Badi/Mana Basthi-Mana Badi contract of the Telangana government. We have 150 running projects now. Residential projects account for 80 per cent of our order book. We have over 250 full-time employees, and 2,500 painters as business partners. We execute 15 lakh square feet of painting work across India every day now. We closely monitor progress of each project through WhatsApp groups and other means. We completed vendor registration with top real estate companies in all metro cities. Henceforth, we are hopeful of getting orders from 20-25 new companies every year. If that happens, we will be able to enhance our order book size by another Rs 1,500-1,800 crore. Paints products account for 60 per cent of our revenues while applications business contributes 40 per cent. We have plans to go for an initial public offer (IPO) in the next three years.
How is the painting industry doing in India now?
On population count, India and China are at the same level. But China’s painting industry is valued at Rs 7 lakh crore while that of India is at low Rs 70,000 crore. That shows how big the growth opportunity is for companies like us. We are confident of spreading our operations to every nook and corner of India if we effectively execute our business partners’ model under which we secure orders through our marketing team while local business partners execute the projects. To beat the established players in the market, we are adopting this unique model.
Do you have any plans to go overseas?
We are planning to enter the UAE market soon. We will open an office in Dubai by end of the year. As a large number of infrastructure projects are being taken up in the Gulf country, we see a big growth opportunity there as well. My dream is to build Fortune Group into a top construction materials company with presence in multiple countries. We are working hard to realise this dream. We are also working on a strategy to have all building materials under one roof. Apart from paints, we have unplasticized polyvinyl chloride (uPVC) windows in our product lineup now. We will add construction chemicals soon. In the next five years, Fortune Group will have a large construction material vertical.
What is the secret of your success now?
Business is my passion. And I have a good team of employees now. I always treat my employees as business partners. Therein lies the secret to our Fortune Group’s success. Many of our employees have bought villas, properties and settled very well now. I always try to transform my employees into entrepreneurs. Not many companies do that. I strongly believe that our group will continue to grow if it follows this strategy.