Trying to understand the broader trends of a niche business segment can be an exhilarating experience sometimes. You may come across facts that are not readily available in the public domain, even as they underline defining innovations, which may have already begun playing out or are at an evolving stage. Consider this. Gurgaon-headquartered Gallant Sports & Infra (GSI), one of the leading players in the niche sports infrastructure arena today, is on the verge of striking a deal with a global footwear giant, to produce synthetic tracks at a larger scale. Under the deal, the shoe-maker will be providing sole granules (of used and expired sports footwear) to Gallant, which the latter will use to produce athletic track blocks.
Nasir Ali, CEO & founder, GSI, has many such interesting stories to tell you. In the nascent segment of sports infrastructure, new basic rules and dynamics are being set today, as the demand generation exercise skips to a new tangent, with push coming from both the private and public sector. Ali’s Gallant is one of the leading firms, which seems to have arrived on the scene at the right time (its story began in 2016). “There are more than half a dozen specialists in the organised business today, who are present in the market in project execution and have a revenue base in the vicinity of Rs100 crore individually,” affirms Ali. “We are one of them and this group of early movers has grown fast in recent years, with our own CAGR having been close to 30 per cent. And then there are innumerable players, who do smaller projects at the regional level; they are also growing”. The alumnus of Indian Institute of Foreign Trade (IIFT) had begun his career as an exporter and then switched to the sports infrastructure track (after a brief stint with another firm around Commonwealth Games in 2010) and is now preparing for an IPO (SME category).
Going beyond nascent stage
In a country where several post-independent generations were fed the conventional wisdom that sports is not the ticket for a stable and quality life, the lack of focus in developing sports infrastructure has been quite obvious. In a cricket-crazy nation, where other sports fared poorly in terms of getting public attention, the need to develop infrastructure for other sports (not just multi-sport stadiums but also at educational institutes’ level) was clearly not a priority. You go through any global ranking list of countries with best sports infrastructure (considered to be a multi-billion dollar business) and you will not find India’s name in the top 10 or even top 15 category. However, in business terms, the potential could be gigantic. When you say sports infrastructure business, it does not merely comprise hard physical infra-assets like stadium, but also multi-sports facilities, fitness centres, designers, equipment manufacturers, contractors and dealers, apparels and accessories and a strong technology quotient has also stepped now, which is increasingly becoming strong.
But even as India has been traditionally lagging, some experts feel that things have started changing now. “I don’t think we can just qualify our sports infrastructure as nascent,” says Ramkumar Subramanian, director, Collage of Design & one of the top architects in sports project designing in the country. “Today, it is more than that. I would say that, in the last four-five years, it has been on a fast-evolving curve, with hard push coming both from the government and the private sector. The defining programmes like ‘Khelo India’ is bringing that kind of change and you would have noticed more buzz around our national sports scene in recent times. It’s not only the Central government but some of the states also have become agile on this. Similarly, pressure is coming from the private sector too”. The push from the private sector, meanwhile, seems to have been triggered by the inclusion of developing sports-linked assets in the corporate social responsibility (CSR) programme.
The push from the government is quite visible today. For instance, the Centre (ministry for youth affairs & sports) has sanctioned over 340 sports infrastructure projects across the country. States like Maharashtra are leading from the front, by clearing projects like the National Centre of Sports Excellence in Mumbai, which it is setting up in collaboration with Sports Authority of India (SAI). The list of pro-active states includes Odisha (Rs1,315 crore), Kerala (Rs6,000 crore) and Andhra Pradesh (Visakhapatnam Sports City), which have allocated sizeable funds to develop sports infrastructure. Gujarat too is now developing Sardar Vallabhbhai Patel Sports Enclave. And, several projects have been set afoot for the upgradation of brownfield sports projects in metro cities like Delhi, Mumbai and Bengaluru and also important state capitals and non-metro locations like Lucknow, Bhubaneswar, Indore Rajkot, Guwahati and Coimbatore. And, then, there are efforts the private sector is making, mostly by way of creating sports foundations and academies.
On a small base, GSI has been in the forefront of tapping the new opportunities in the sports facilities segment (both greenfield and brownfield) and seems to have fared well if their revenue trajectory is to be examined. “From being a Rs1 crore business in 2017 to Rs70 crore in the last fiscal, we have grown at a brisk pace,” claims Ali. “We wanted to cater to the education sector, corporates and dealer markets – essentially building a diversified business. We started towards the end of 2016, and now we’ve become India’s largest sports infrastructure company by volume. Some competitors may have higher turnover, but they typically handle only a few large government projects”. He emphasises that his company has executed over 700 projects till date. This includes large-scale government projects and some of the defining projects in the educational sector, which primarily meant creating multi-sports facilities. Gallant focusses on turnkey projects, the exercise involving executing base work, turf, water permeability and compliance, with international standards for sports like hockey, football, basketball and athletics.
In its nine years journey, the education sector has been a stronghold for the company, wherein it has built infrastructure for over 200+ schools in India. This included building basketball courts, tennis courts, pickleball tracks and multi-sport surfaces. Of late, the company has also been getting into the corporate-driven CSR activities, which focus on creating quality sports infrastructure. Under this category, GSI has created a football ground for Royal Enfield in Leh – at 14,000 ft, which is probably the highest field in the world. The company has also executed a hockey training academy project in a village in Jharkhand with Timken. And now it is aggressively responding to government projects, which are larger in size. “Today, 50 per cent of our business is government-related,” Ali points out. “Though we do fewer government projects, each one is large – mostly falling in the over Rs10 crore category. We’ve completed 12–13 full sized FIFA-certified football fields, making us India’s largest company in that category. We’ve also done four hockey fields, while three more are underway – including the one for Varanasi Smart City and two for the Tamil Nadu government”.
In a small way, the company has added a new strength to its portfolio. It has begun domestic manufacturing of athletic tracks. “PU tracks, commonly seen as the red-coloured running surfaces in stadiums, are composed of a mix of polyurethane and rubber. These are laid in a liquid form and then cured to form a durable, shock-absorbent surface. We’ve already completed a Rs10 crore project in Arunachal Pradesh, using our make-in-India PU tracks,” adds Ali. India does not have strength in manufacturing the basic components used in creation of sports infrastructure; so, they are mostly imported from China or the European countries.
For the future
Manufacturing basic products like running track is going to be a major emphasis for the company in the years to come, Ali explains. “We believe this segment has significant potential – every district, town and city in India needs proper running tracks, not just for athletes, but also for recreational use like jogging and fitness activities,” he observes. The company has already received approval from the World Athletics Federation to pursue this. To encourage this line of activity, GSI is also collaborating with a Polish firm, which will help with raw materials and technical support.
GSI is now looking at a bigger picture, where the growth propensity will be higher. While encouragement from the government and the private sector seems to be getting more robust, a demand uptick is also visible from high-end residential quarters. Talk to any expert in the residential segment and he will agree that, with more action witnessed in the luxury or upper mid segments, the customers are asking for dedicated fitness centres; sports zones and realtors are also making these offerings more as an integral part than a vital add-on as was the case till recently.
“Things remaining normal, the sports infrastructure segment will grow big time over the next decade,” Ramkumar of Collage Digital observes. Nothing surprising, as players like GSI seem to be in an upbeat mood, maintaining that the organised segment of the business has reached an inflection point. “Our target is to reach Rs1,000 crore by 2030 and I think this is quite possible,” says Ali, while asserting that the company has begun making moves in the direction of scale building. And, a preliminary sign would be visible soon, with a possible IPO in the SME category (by the end of 2025-26 or early next fiscal). The ticket size is expected to be in the Rs40-50 crore bracket.
Market observers like Ramkumar add one more interesting element to the massive uptick argument. “India is bidding for 2036 Olympics,” he stresses. “If that happens, the sports infrastructure segment will hit a new level, where sky will be the limit. Many international players will be jumping into the fray”. And that would be good news for domestic specialists, who may be sought for large-scale collaboration. So, if players like Gallant Sports & Infra are hoping to add more spring to their steps, it may not be off the track in its expectations.