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How man made Sh2 billion fortune from water tanks

  Sep 25, 2014
 

When the Flame Tree Group brings to an end the two-year listing drought with its entry to the Nairobi bourse later this year, it will be a culmination of a 43-year-old man’s journey into the world of enterprise that began 25 years ago with the founding of a plastic tanks making enterprise.

The man behind the company is Heril Bangera who took a leap of faith as an 18-year-old in 1989 to exercise his entrepreneurial skills using the Sh500,000 startup capital he got from his father.

The business he founded is Roto Moulders Limited, a company that has since grown to become one of Kenya’s biggest plastic tank manufacturers.

Roto has since evolved into the Flame Tree Group (FTG), a diversified consumer goods maker that produces popular household brands such as Roto Tanks, Zoe beauty products and Happy Golden snacks.

Mr Bangera wants to take the company public by the end of the year, bringing to maturity a business that has its roots in the backyard of a family friend’s factory on Nairobi’s Enterprise Road.

The mechanical engineering graduate from Bangalore University founded the business while studying in India, depending on his father Fredrick Bangera to keep it going until he graduated in 1991.

Mr Bangera, 43, says he got inspired to go into the plastic tanks business using the experience he gained while helping out at his father’s steel fabrication firm — David Engineering.

“I saw opportunity in the plastics industry given that at that time there was only one manufacturer of plastic tanks,” said Mr Bangera in an interview at the group’s now expansive premises in Nairobi’s industrial area.

Unlike the case with many family businesses, Mr Bangera chose to break away from his father’s business to start his own and remains the sole proprietor of the company to date.

From an initial production of just four tanks a day in 1989, the group now produces about 500 tanks per day across the different brands and sizes.

Mr Bangera says he has gradually expanded the business using retained earnings – staying away from bank loans which he considers a high-cost financing option.

“We hardly made any money for the first eight years of the business until we put in place a regional expansion plan that helped us break even,” says Mr Bangera.

The Flame Tree Group is now operating on an annual turnover of more than Sh2 billion from its operations in Eastern Africa and a workforce of 1000 employees.

Roto Moulders Limited rebranded to the Flame Tree Group in 2003 as it diversified into the fast moving consumer goods (FMCG) market with the launch of the Zoe brand.

Source- Business Daily



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