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Talk about his company's fortunes is likely to elicit a beaming smile from Mahesh Gupta. Kent RO systems' managing director says that his company's profits grew 40 times between 2002-2003 and 2007-2008: from Rs 2.5 crore to Rs 100 crore. Other water purifier manufacturers also say that business is good. Are they making tall claims? Or are they making hay while the sun shines?
Actually a bit of both. There is little doubt that the water purifier market is growing. But accurate market size figures are hard to come by. A 2005 study by us- based consultancy firm Frost and Sullivan notes that one in every 40 Indian households uses water purifiers. R S Rajan, vice president consumer marketing of the Mumbai-based Ion Exchange, says that water purifier penetration in the country ranges from 25 per cent households in Delhi to 0.42 per cent in cities in Bihar (see graph: For clean water. There is also no unanimity on the value of the market.Ion Exchange puts it at Rs 800 crore, Frost and Sullivan says it is worth Rs 1,400 crore and Eureka Forbes pegs the figure at a little more modest Rs 1,000 crore.
Market share figures are similarly obfuscating: there is no government data, and claims of different companies simply don't add up. For example, Kent's claim of a 40 per cent urban market share would not hold much ground if Eureka Forbes' contention of a 70 per cent market share is found to be accurate.
Rajan puts the issue in perspective. "Market research is tailormade,' he says.
Frost and Sullivan does say that "Eureka Forbes, Kent RO, Usha Brita and Ion Exchange are the biggest operators in the Indian water purifier market.' But the us- based consultancy also points to another significant player: the unorganized sector with a 45 cent share in the market.
Spoilt for choice?
S Mushtaq Khan of Frost and Sullivan says, "Ultraviolet (uv)- based systems dominated the market in 1990s. Reverse Osmosis (ro) systems are gaining acceptance though they are costlier,' he says. Pritee Shah, editor of the consumer magazine, Insight concurs. "Marketing stunts have created the impression that water can only be purified by the reverse osmosis (ro) system,' she says (also see box: A film star speaks).
| For clean water |
| Penetration of household water purifiers |
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| Source: R S Rajan, vice president, consumer marketing, Ion Exchange India Limited, Mumbai, personal communications, February 20, 2008 |
Most water purifiers today combine two or more treatment processes. These include ro, uv, filteration and disinfection technologies. Industry insiders point out that Eureka Forbes, conventionally known for uv- based systems, has integrated ro and carbon filtration into its products. Frost and Sullivan says that 51 per cent of the purifiers in India are uv- based while 42 per cent are ro systems and the rest candle and resin filters. This is going against the global grain where ro- based systems hold just 11 per cent of market share.
But are ro systems suited for Indian conditions? C K Sandeep, associate vice president Ion Exchange says, " ro is not needed at places where total dissolved solids are less than 500 mg/l. In such conditions ro systems are very likely to rob the water of essential minerals .' Other critics talk of the huge water wastage: 60-75 per cent water goes waste with ro systems.
Such inefficiences have not been addressed by recent innovations. Most of them have been cosmetic. Innovations on operation and maintenance come at a cost. ro systems require cleaning every three-six months. Membranes have to be replaced every one-and-a-half to two years. Normally, first year servicing is free while subsequent services have to be paid for: charges range from Rs 1,200 to Rs 3,600 based on the product.