This Bengaluru-based home textiles company makes Rs 75 Cr turnover, eyes Rs 500 Cr

Growing up in Kolkata, Gaurav Sureka was exposed to entrepreneurship from an early age. The young boy saw his Marwari family run a general supplies business that catered to the Indian Army.

But Gaurav soon realised he wasn’t interested in this domestic enterprise. He was more intrigued by the concept of exports in a business, which involved a lot of travel, meeting people, and having new experiences.

“One day, I got an opportunity from my friend’s father to get involved in a textile company with an export model. I accepted and moved to Bengaluru in 1999 to join the company,” he says.

Gaurav worked there for 13 years and gained experience in the sector. Eventually, he felt he wanted to start his own business in the same domain.

Giving in to his entrepreneurial desire, Gaurav and his business partner Ramachandra Shastry started Revolucion, a mid-market woven fabric and home textiles company, in Bengaluru in 2012. The duo put a self-funded amount of Rs 1 crore in total into the business.

Finding synergy

Gaurav and Ramachandra became friends with Syed Mukarram and Syed Farook, who ran Ethnic Silks, a high-end fabric export business. Even though they were competitors, Gaurav saw synergy among the four of them.

Until this point, Revolucion and Ethnic Silks produced and sold fabric to client companies that used it to make their own home decor and furnishing products, such as curtains, sofas, bed sheets, pillow sheets, etc. The finished products were sold under the brand names of the clients, and not under Revolucion and Ethnic Silks.

Seeking to build some of their own brand presence, the four entrepreneurs felt they could come together to start a brand that stocked and sold furnishing fabrics made by Revolucion and Ethnic Silks. This led to the birth of Rumors Fine Furnishings in 2014. 

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By no means did this new brand signal the end of Revolucion’s and Ethnic Silks’ model of selling fabric to other furnishing companies. Rumors was considered another business that Revolucion and Ethnic Silks ‘sold’ to.

Being an end customer-facing brand, Rumors placed its product catalogues in furnishing and decor showrooms.

Over the next few years, the partners brought in Rs 5 crore in total in the form of unsecured loans, as and when their businesses required it.

The idea for a conglomerate

The four entrepreneurs owned Rumors together. However, they realised that by having three separate companies, their approach was fragmented.

“We then decided to bring the three companies under one entity - a furnishing fabrics conglomerate that allowed us to strengthen our product line and target our clients in a more varied manner,” Gaurav says.

By bringing the three entities together, the entrepreneurs wanted to capture a bigger playing field, cut their expenses, and increase their profits. In 2019-20, rather than opting for a traditional merger, they transferred the three businesses to Ascent Décor, which became their conglomerate.

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This way, Revolucion, Ethnic Silks, and Rumors didn’t have to completely restructure their operations in order to become one entity. They could go about their day-to-day operations in a manner they were used to.

From here, there was no looking back. Gaurav and his business partners decided to focus on design and competing in the mid-to-high end furnishing fabrics market.

Market scenario and manufacturing model

“It was not easy being a new brand. We had to convince customers and help them understand why they should buy from us. We focussed on building great furnishing fabrics products and providing good service,” he says.

Despite the presence of larger and more established brands in the space, Ascent was able to slowly get a foothold in the market.

It did so partly by deciding it wouldn’t engage in price wars or cut-throat competition in the mass market segment, where product margins are notoriously low. Ascent chose to play in the mid-to-high end market because it recognised its expertise was niche and more oriented towards product design.

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“Our competitors included large and established brands like D’decor, and we needed a lot of might to compete. Presently, we are still quite far away from matching their top line, but we have scaled quickly. Last year, we recorded Rs 75 crore revenue,” Gaurav says.

Ascent sources raw material, such as yarn from Mumbai, Surat and a few other locations. The silk comes from China, Vietnam, Brazil, or Belgium, depending on the requirements of Revolucion and Ethnic Silks.

Ascent then uses the raw material to manufacture furnishing fabrics at its vertically-integrated plant in Bengaluru. The 350-employee company’s products cost between $4 per metre of fabric and $100 per metre, depending on their range, that is, whether they are mid-market products or extremely high-end ones.

“Our furnishing fabrics have been used for decorating windows at the official residence of the Prime Minister of India, as well as the White House in the US. They have also been used in the homes of several Bollywood and Hollywood stars,” he adds.

However, Ascent Decor doesn’t get branding from this. The furnishing and decor used in these high-profile residences are made by companies to whom Ascent supplies its fabrics.

“I can only say that we have designed and produced the fabric, but we can’t call the finished curtains or sofas our own products. But we certainly take pride that our work has made it to that level,” he says.

Future plans

When Gaurav and his business partners started working together, they had a dream to make something out of their business - but they didn’t have a clear trajectory. They set themselves the target of reaching Rs 100 crore revenue first, and they came close in 2019-2020. Gaurav says the coronavirus pandemic made it difficult for them to hit Rs 100 crore last year.

Now, they have come up with a two-phase plan to take Ascent even higher and take it to between Rs 500 crore turnover, or more.

Gaurav explains that phase-1 involves taking Ascent to Rs 125 crore or Rs 150 crore revenue in a couple of years. He wants to do this while the company is still self-funded.

Ascent will look to acquire businesses in the same line of trade and grow its volumes and customer base in domestic and international markets. “We are already in discussions with multiple businesses for this, and the road maps have been laid,” he says.

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Then, Gaurav wants to take the help of consulting firms to make Ascent investor-friendly and transition to phase-2.

“Phase-2 is about reaching Rs 500 crore or more so we will look to work with an investor. This stage will begin soon after the previous phase is completed, i.e., around two years from now,” he says.

Ascent’s plans for expansion fall in line with expectations that rising income levels and growth in building and construction segments will drive demand for non-clothing textiles. Further, India enjoys a comparative advantage in skilled manpower and in the cost of production.

But the coronavirus pandemic has halted growth and cut demand. Gaurav believes the situation is temporary and will pass, and he remains confident Ascent will sail through and get back on track to meet its expansion goals.