Monday, December 10, 2012

Tatas eye big foray into edutainment

India's oldest industrial house, the Tata Group, is sketching big plans for children's edutainment market, a move signalling the tea-to-telecom conglomerate's interest to tap business opportunities around the country's 330 million population aged below 15 years.

Bangalore-based Titan Industries, a Tata Group company, is expected to finalize business plan for edutainment vertical, positioned as 'after school education through gadgets and technology', within a month, people familiar with the development said. This will be among the biggest growth drivers for watch and jewellery maker, which is the fifth largest Tata firm by market valuation.

The company's new business division wants to develop a network of about 160 edutainment stores, expected to rake in more than $1 billion revenue by the end of the current decade. Titan scanned several business models targeted at the children's market, including toy retailing, before narrowing its focus to edutainment stores.

Titan's edutainment business strategy will combine content with 3D and simulation technology with themes like 'journey across time', which sits well with the company's watch business too. The company has prepared an extensive case study, with inputs from design architects, to be presented to the board of directors later this month. The edutainment business will be deemed to be formal only after the board approves it. A questionnaire to Titan IndustriesBSE -0.96 % spokesperson remained unanswered at the time of going to press.

Titan reported Rs. 8,840 crore ($1.63 billion) revenue last fiscal powered by the watches and jewellery divisions. The company has explored plans to boost its top line revenue to $10 billion by 2020. The company, in which the Tatas hold more than 25% stake, closed the Friday trading on BSE almost flat at Rs. 307.

Tata Group companies with surplus cash on their books have been asked to draw up plans of how they would utilize their cash surpluses in adding value to shareholders. Titan had surplus cash of nearly Rs. 800 crore (Rs. 8 billion) at the end of last fiscal. The flagship edutainment stores will be more than 80,000 sq ft, located in the suburbs of the big metros, attracting investments of Rs. 100 crore (Rs. 1 billion) each. The stores in smaller cities will vary between 8,000 to 10,000 sq ft. Titan will start work on rolling out the initial stores in two southern metros, once the board approves the business plan.

The $100-billion Tata Group's interest in edutainment tracks the growing investments in this space. Last month, Bollywood star Shah Rukh Khan acquired 26% stake in the India franchise of Mexican edutainment brand KidZania, scheduled to open first store in a Mumbai suburb March next year.

Source: The Economic Times (Online Edition), December 10, 2012

No comments:

Post a Comment

Blog Archive