JSW Group has closed down its furniture retail business housed under Forma brand within one year of its launch due to “faulty business model.”
Forma was launched as a brand of JSW Living Pvt. Ltd. in April last year to help the steel -to-energy- conglomerate foray into India’s fast-growing $19-billion furniture market with the aim to figure among the top five furniture brands in India.
However, dealers point out the faulty business model and immature market for steel furnitures for the failure of Forma. “The Indian market is not yet evolved for steel furnitures,” said a dealer.
A JSW Group official confirmed that the retail furniture business had to be shut down, without elaborating further. However, a spokesperson for the group declined to offer any comment.
The venture was headed by Tarini Jindal Handa—daughter of steel magnate Sajjan Jindal.
“We are learning and there is an immense distance to travel,” Ms. Handa had told The Hindu at the time of the launch. She had announced plans of investing around ₹250 crore over the next five years to the aim to achieve a revenue of ₹1,000 crore.
Meanwhile, JSW Paints led by her brother Parth Jindal is also facing problems in making inroads into the paints business as its facing tough competition from market leader Asian Paints.
On, complaints of JSW Paints, competition watchdog the Competition Commission of India (CCI) has ordered for probe against Asian Paints for allegedly threatening dealers and misusing its dominant position in the market to restrict the entry of JSW Paints in the three southern states of Karnataka, Telangana and Tamil Nadu.
“The company is currently examining the order and will take appropriate legal recourse and will extend full co-operation to CCI in the matter,” said Asian Paints in filing to the exchanges.
While the $13 billion JSW group is looking to diversify beyond steel and energy, to cement, ports, paints and furniture segments. JSW has, however, given up on its plans to foray into the electric vehicles space citing higher than anticipated uncertainties associated with the EV business.
