Lanka Ceramic to invest Rs.200mn to make mosaic tiles for export

Lanka Tiles PLC is to invest Rs.200 million to manufacture porcelain mosaic tiles for export market with foreign collaboration.

The company in a stock exchange filing said it has entered into a tripartite agreement with China’s Foshan Shiwan Yulong Ceramic Co. Ltd and Benjamin Malloy of Dallas, Texas in the US, for this purpose.

Under the agreement, Lanka Tiles with the technical assistance from Yulong, will convert its present idle capacity of 2,000 sq. mt. per day to manufacture porcelain mosaic tiles for 
export markets.

Lanka Tiles Managing Director Mahendra Jayasekara said the agreement was entered in light of the USA imposing anti-dumping duty on ceramic and porcelain products of Chinese origin reaching the USA market.

“This new tariff regime has created opportunities for other manufacturers of similar products to increase exports to the USA.

It is envisaged that approximately Rs.1 billion of sales revenue will accrue to Lanka Tiles PLC within the next two to three years from the sale of porcelain mosaic tiles in both export and local markets,” Jayasekara said.

Currently, the exports amount to just 3 percent of Lanka Tiles’ total sales.

For the first six months of FY20, Lanka Tiles export sales fell 50 percent year-on-year to Rs.64.6 million. For the FY19, the company recorded export sales of Rs.218.1 million, down 
18 percent.