Steel maker beats stiff odds, claims spot in elite Club 101

Brollo Kenya has grown from a struggling steel manufacturer on the verge of collapse to be named among the eight members of this year’s Club 101 in the Top 100 survey, an elite group of mid-sized companies with annual revenues of over Sh1 billion.

The Mombasa-based company produces more than 2,000 tonnes of steel every month, having grown from producing 400 tonnes four years ago.

Besides the manufacturing plant in Mombasa, Brollo Kenya has offices in Nairobi, Kisumu and Embu and exports its products to Tanzania, Uganda and the Democratic Republic of Congo.

Lalit Doshi, the current chairman, and his nephew Ketan Doshi (the managing director) acquired the firm, that was on the verge of collapse, from an Italian investor in 1996. The firm was set up in 1972.

“Our investment over the past few years has helped enhance our product range as we seek to become the biggest tube and steel manufacturing company in the East Africa region,” said Pritesh Doshi, the firm’s operations director.

“We have been participating in the Top 100 for the past four years now, which means our company has been demonstrating growth, profitability and financial stability in the short term,” said Mr Doshi.

Over the last three years, the firm has invested close to Sh408 million to refurbish its existing machine line to enhance capacity.

These enhancements, Mr Pritesh says, have helped position the firm as a fast-growing steel producer in a country where demand is high, driven by construction in real estate, roads and the standard gauge railway.

A vibrant steel industry is one of the foundations of an industrialised nation. Iron ore deposits have been confirmed in Meru, Kitui, Taita Taveta, Homa Bay and Kakamega while coal, required to heat the ore to remove impurities, has been discovered in Kitui.

Brollo Kenya’s journey to the coveted Club 101 has not been without trials. In 1996, the firm was facing severe financial difficulties which saw the Doshi family inject approximately $1 million (Sh102 million) to acquire the business, thereafter turning it into a fully family-owned enterprise.

The company, however, continued to struggle with low sales. At one point, the firm which today employs 220 people, had trouble paying its staff members.

So bad was the situation that Mr Pritesh, who left a banking job in Australia to join the family business in 2010, was receiving a salary about six times lower than his previous job.

“Leaving my job was one of the hardest decisions I ever made in my life but I realised that the responsibility of ensuring the family business grows and thrives was on my shoulders,” he told the Business Daily.

Mr Pritesh says the company’s participation in the Top 100 survey has over the past four years helped the firm jumpstart its business by opening themselves up for scrutiny and aice.

“The survey has also been a good way of marketing ourselves and getting to know prospective clients,” he said.
Brollo Kenya is among eight companies that made it to the Club 101 category. The others include Vehicle and Equipment Leasing Ltd, Trufoods Ltd (maker of Zesta jams) and Eldohosp Pharmaceuticals.

Others are Mega Pack Ltd Sigma Supplies (poultry supplier) Kenya Builders and Concrete Ltd and Canon Chemicals Ltd, maker of Price dish washing paste, air fresheners and Valon jelly and lotions.

gmarete@ke.nationmedia.com
SOURCE: BUSINESS DAILY