Meet CA Mikdad Merchant — Whole-Time Director, CFO, and the visionary behind Safe Enterprises Retail Fixtures Ltd. As the company gears up for its IPO, Mikdad shares how a legacy business founded in 1976 evolved into a tech-powered modular shop fittings enterprise, with smart, electrified fixtures shaping the future of retail.
Mubina Kapasi: Hi everyone and welcome to Small Cap Spotlight. Today I have with me an individual whose journey has been nothing short of inspiring. Yes, he is the whole-time director and the CFO of Safe Enterprises Retail Fixtures Limited, a company on the anvil of an IPO, but he’s overcome several personal challenges and become a serial entrepreneur.
Here’s Migdad Merchant to talk to us about the company and his own journey. Hi Migdad and thank you so much for joining us. To begin with, I want you to first introduce the company to our viewers. Where did it all begin?
Mikdad Saleem Merchant: Hey Mubina, firstly thank you for having me here. So, Safe Enterprises as an entity was formed in 1976, but in 1991 under leadership of my father, Salim Merchant, we pioneered into the modular shop fitting space and from that point there was really no looking back. What started from a small workshop is now a multifaceted business group spanning five factories, multiple locations, multiple showrooms, etc.
In July of 2024, we converted from a partnership firm into a limited company in the name of Safe Enterprises Retail Fixtures Limited for our upcoming IPO.
Mubina Kapasi: Okay, lovely. So, tell me more about what do you mean by shop fittings and retail fixtures exactly and modular.
So, it’s I mean we have some sense of what exactly it means but you would of course be in a better position to simplify your product. So, tell me all about your product profile.
Mikdad Saleem Merchant: Okay, so Mubina, if you go to a retail store to purchase clothes, the thing that would take the 80% more than 80% of the visual space of the retail store, that is the furniture for on which the merchandise will be kept and that is called retail fixtures.
Now, traditionally our business includes complete bespoke retail fixtures where you know a retailer would come to us, give us their designs, we would check it from an engineering perspective, redesign it and you know get the entire visual look together, then manufacture it for them and then install it on their site, a complete rollout. Now, this is perfect for large format stores with multiple rollouts you know planned.
Mubina Kapasi: And maybe bigger budgets too probably?
Mikdad Saleem Merchant: And bigger budget budgets too but again the budgets are flexible.
So, when it comes to now, retail is also evolving. We have like technology is permeated in every aspect of life and retail is no exception. Now, retail technology is again mainstream.
So, to be in sync with today’s you know shoppers and today’s retail experiences, we started in-sync shop fittings in 2010 to help shops transform into smart shops. So, what does this entail? Say for example, you are in a store and you like a top, you pick that up. Now, traditionally you would have to wait for a salesperson to come and help you with your size and you know what are the different options available etc.
But today, shops are smart shops. You don’t need to do this anymore. You simply take the merchandise, you take the tag, the QR code or the barcode and scan it on an in-sync powered scanner and bam, all the details of that item comes on screen.
And then you can have a self-checkout kind of you know use case created for any retailer as required. Okay. And why is all this possible? Because our entire fixture set is electrified.
So, all this technology including the RFID scanners, the screens, the LED lights, everything is powered directly from our tracks, directly from our uprights. You will not see a single wire anywhere.
Mubina Kapasi: Okay, very interesting and this is something that’s developed in the last 15 odd years, 15 to 20 odd years.
Mikdad Saleem Merchant: Yeah, so this entire range is a culmination of around 5,000 hours of research and 15,000 hours of development over the last 15 years from 2010s when we started this. And R&D is like a major part of our strategy, you know. We have 13 plus proprietary design patents and counting.
More in the pipeline, more are being developed every day and this is what is core part of our business because retail is evolving, right. Today’s shoppers are smart shoppers and when it comes to retail fixtures, you as a shopper are interacting a lot with the fixtures. So, that is why it’s a very major part of the retail experience.
Mubina Kapasi: Okay, interesting. Now, you know you said you customize fittings as well. That’s the other part of the business. But to do that and there are so many kinds of retailers you cater to, right, and every retailer may have a different requirement so on and so forth. That’s been your historical business model. Are there any challenges?
Mikdad Saleem Merchant: So, if we just, you know, if we get the design from the customer and if we were to just make it without putting any of our expertise into it, we are not sure whether the unit would even stand.
The reason is that, see, it’s visually appealing, right, when it comes to us. But then the challenge is to transform it from just being visually appealing to actually being functional and safe. Because again, shoppers are going to interact with this, right.
Safety is a very important aspect of retail fixtures. So, for that reason, there’s a lot of engineering design, technical spec check that we have to do. So, this is an ongoing challenge that we always have to overcome.
Also, sites are varied, sizes change, etc. So, for this, what we do, we have over 3000 standardized shop fitting components, right. We go by the motto, standardized engineering, customizable skins.
So, all our engineered components are standardized and, you know, from our fixed range. But then we can incorporate any kind of skin element that you require. So, any kind of finish, any kind of veneer, any kind of wooden texture, whatever you need.
Mubina Kapasi: Okay. So, basically, we have to look at safe enterprises, there’s NSYNC and your more modern section of the business that you have recently started in the last 15-20 years. And then, of course, your traditional business, which is basically what we just spoke about.
So, right now, as we speak, you know, as on 2025, what’s the contribution from both these kinds of businesses? And I also want to know if you can share which is more profitable.
Mikdad Saleem Merchant: So, in terms of contribution, I will tell you that one thing you have to understand that there’s no hard bifurcation between the two, because even in the customized part of the business, where we might use, we might customize it entirely to the design of the retailer. But in that also, we might use our standardized components, which may be from the NSYNC range.
So, both the parts of the businesses are very integrated. But if I have to give you a motamoti bifurcation, then say around 25% of the contribution of the consolidated revenue comes from the modern range.
Mubina Kapasi: Okay, excellent. All right. And I presume you see that may be growing more, you see the, you know, that modern range sort of seeing more demand?
Mikdad Saleem Merchant: Absolutely. Because see, what we’re doing is we are recreating the future of retail and electrified tech enabled shop fittings is the future of retail.
So definitely, we see this, you know, growing, going forward.
Mubina Kapasi: Okay. You know, we’ve spoken a lot about the company.
But before I move on to the larger industry trends, etc, that you see, I want to talk about you, Mithat. Because your journey has not been one without challenges, you overcome those personal journeys. And yes, there is safe enterprises, but you’re also a FinTech entrepreneur.
I want to talk about your own personal journey. And how did, you know, it lead to your joining Safe, and you’re also incubating your FinTech.
Mikdad Saleem Merchant: So Mubina, I’m a chartered accountant by profession.
So in 2011, when I cleared my chartered accountancy, I joined the business group, I joined Safe Enterprises. And because well, accounting was the most close to home function that I could join. And that’s how I started with accounting.
But then soon my tech kida, so to speak, got the better of me. And I started automating a lot of solutions at Safe Enterprises started off with like Excel macros, then got into mainstream coding. And in like seven years till like 2017, I have bought proficient with almost like five programming languages created for applications, created a bill of material system with a built in optimizer to visualize the cutting layouts, all of that and to calculate how much material will go in each order.
And that’s still being used by the way, in Safe Enterprises. So then in 2017, I took all these experience and I decided to create a consulting business by name of Insight Advisory Services LLP, which is a subsidiary of Safe Enterprises. Okay.
So that is our consulting and professional services arm. Now the various engagements that I did in insight advisory, be it from mergers and acquisitions to fundraising to, you know, investment advisory, etc, that all that has all contributed to you know, the ability insight and knowledge that is allowing me to lead this IPO journey right now. Okay.
And also during this period, I realized that the well lot of problems when it comes to, you know, expense management, especially expenses done by employees outside the business. It’s a big area of problems. A lot of leakages happen during the course of you know, reviews, we realize that a lot of fraud also happens in the space.
And seriously, the solutions at the time are not able to address this challenge properly. Plus UPI right now is the mainstream, you know, payment method. So when it comes to expenses like conveyance, etc, where there is no bill or proof available, a standard expense management system would you just rely on the invoice.
But what about the digital trail, and especially for smaller expenses like you know, where bill and proof is not available. So this is what led me to create Bispay. And we launched Bispay in 2023.
And now we’ve already raised funding from angel investors, etc. And that entire business is also on its trajectory to grow.
Mubina Kapasi: All right, super.
But you know, what’s interesting in all of this Mithat is that you’re differently abled. And abled in how? Because you managed, you know, through your visual disability, you’ve managed clearing your chartered accountancy. You have learned God alone knows how many languages, you know, computer languages.
And you have started multiple businesses, you’ve solved so many on ground problems that your business was facing. I want to know about that. I want you to share your journey on that front.
Mikdad Saleem Merchant: So Mubina starting with my how I cleared my CA. So you know, at the time when I had given my first exam, and I was giving CBT, we had these large books. Okay, now before this till now, how I’d studied is when it came when it came to school.
So my brother also has a similar visual impairment. So my mom had recorded all the subjects, like literally recorded the books in cassettes. And luckily, the portion for my brother and me was the same.
So I used to use those cassettes. So that’s how I studied my 10th and etc. cleared all that got a decent score for the time 86.8. Then, like when it came to college, friends used to read out to me, right? But now what happened when I decided to do my CA, CA has a lot of practical subjects in terms of accounting, etc.
Also, the theory subjects had like these fact modules, right? So now it’s not practicable for anybody to read it out to me and all. So I had to choose, I had to find and search for a better way. So I bought a scanner.
And I checked with a few friends who are good in it. And they told me that there’s something called OCR optical character recognition, which allows me to scan a book. And then the computer will scan it for like readable text, it will first scan as an image, but then it will convert into readable text.
So my screen reader software from my computer will read out to me. And that’s how I studied my CPT. And when it came to accounting subjects, so there was this.
So I have low vision, right? It’s not that I cannot see, I just have low vision. So I need more light to see. So in such a situation, when it came to accounting subjects, I had this window of like two to three hours that I would get light directly on my parapet where I would sit and study.
So I would use that to do all my practical subjects. And I was used all the other time to do my theory subjects. And that’s how I cleared my CPT.
Then when it came to PCC, the Institute was really nice enough to you know, give these CDs on which all the PDFs already there so I didn’t have to scan. For the practical subjects, I would still do the same thing, use the window to study practical subjects and then use the rest of the time for theory subjects.
Mubina Kapasi: How did you get the exam?
Mikdad Saleem Merchant: So while giving the exam, I had a reader, like they would read the paper to me so that I would not waste time in you know, being very slow to read it and then I would write the papers.
That’s how I cleared on my papers.
Mubina Kapasi: And you would write it yourself?
Mikdad Saleem Merchant: I would write myself.
Mubina Kapasi: That’s amazing.
I mean, really, if you can do it, I think none of us should really have any excuses for not.
Mikdad Saleem Merchant: No, no, seriously, I’ll tell you that that if anybody is like really thinking, you know, of getting into professional studies, and they are really worried that how we can do it. Seriously, I would say the same thing.
But if I can do it, anybody can do it.
Mubina Kapasi: Well, I hope that this serves as an inspiration to everybody watching. Okay, wonderful.
Let’s get back to the business then and you know more about SAFE and the industry that it operates in. Now, we’re in a digital and omni channel environment, right? And retailer needs are constantly evolving. Then you had this whole e commerce thing as well.
That’s been thrown in. Is InSync your answer to all of that?
Mikdad Saleem Merchant: Oh, absolutely. So omni channel is what we designed InSync to be.
And that is what the use case that I mentioned to you as well, where you pick up a top and then you scan it and you get all the details. This is omni channel. The retailer can use his own e commerce website to basically pull up the data there.
And whatever order goes goes directly to their back end and then ships directly to their house. This is also very much possible. So omni channel is the need of the hour.
And that is what InSync shop fittings is catering to. So always remember, we’re transforming shops into smart shops.
Mubina: Okay, getting the best of e commerce and brick and mortar.
How do you let’s talk about now, the actual operations of it, the manufacturing of it, because you’re a manufacturing business, right? So you have to bring in your raw materials, you have to ensure good quality raw materials, because if not, then that impacts your final product as well, right? So how do you ensure quality control, cost effectiveness, and also consistency of supply chain? Because I mean, the world that we live in for the last three, four years, there have been several supply chain disruptions, if you could talk to us about that.
Mikdad Saleem Merchant: Okay, so in terms of quality, first and foremost, the ISO 9001 2015 certified, okay, and quality is something that is very core part of our strategy, and not at a single level, but at multiple levels. So first from sourcing of the raw materials, we have to ensure that the supplier itself is firstly up to the mark to be able to supply the components to a quality level that we require.
This requires vendor management, this requires even training to the supplier, etc. So my entire vendor management team painstakingly does all of this. And we have a very strict tolerance norms to what we accept in our factory.
So that is that handles our input inward quality. Then when it comes to the manufacturing process, there’s an ongoing line by line checking process to ensure that all the components are, you know, up to the mark. And then before dispatch, all the units are assembled, tested, checked, and then disassembled and then shipped out in a CKD, you know, form.
And then finally, these packets are opened on site and all the installation is done. And only after the customer is satisfied and you know, then he hands over the site to us and gives us a clean chit and that is when our project is completed. Okay.
Mubina Kapasi: And anything on the supply chain disruption? I mean, has your company also faced any challenges these last, you know, four or five years that we have seen with geopolitics and then some of the other disruption happening on the global supply chain front? Have you experienced it?
Mikdad Saleem Merchant: So see, most of our components are sourced from, in fact, not most, almost all our components are sourced from Indian suppliers itself. And we’re completely make in India and everything is made here in India itself. Okay.
Now, the suppliers in term may be importing a certain components. But again, there we have not faced any disruption in the last few years. Only during COVID, where logistics costs had increased, so then probably wooden boards and stuff had gone up in price.
And I think that’s the only challenge that we have faced on that front.
Mubina Kapasi: So right now, of course, you’re in India, but do you have plans to go outside India, explore markets outside of India, maybe through joint ventures, maybe solo?
Mikdad Saleem Merchant: So Mubina, we already have channel partners outside India. We already have channel partners in Kansas City, USA and in the UAE.
So, and we are already exporting to multiple countries. We have in fact, done projects in the prestigious Dubai Mall as well. Then in terms of countries, we have the export to Kingdom of Saudi Arabia, UAE, US, Malaysia, etc.
Mubina Kapasi: Okay, wonderful.
Mikdad Saleem Merchant: So now this, but this export business is just like three years old. So it is at a very nascent stage.
And that is what is poised for an exponential growth in the years to come.
Mubina Kapasi: Now, let’s talk about your IPO. It’s about to be opened.
So why, why an IPO right now? What’s the purpose? And why are you raising funds?
Mikdad Saleem Merchant: In New Bombay, currently, we have like four factory locations. And then in Pune, we have one factory through our subsidiary. So now these four factories in New Bombay, we want to merge to bring it to one location for you know, getting more synergy benefits and streamlining our production process.
Plus, in spite of the four factories, we are running at a capacity of over 90%. If you see our DRHP. So with this new factory, we would have good amount of capacity to go to the next level of growth.
And also through the IPO proceeds, we are adding new modernized machineries both in the parent as well as in the subsidiary. We’re going to use it for working capital, and then balances for other growth related purposes and growing the business in general.
Mubina Kapasi: Okay, so basically, your IPO proceeds are going to be fully for business expansion and increasing your…
Mikdad Saleem Merchant: If you see our DRHP, there is no OFS whatsoever.
Everything is a fresh issue and everything is going to be used for business growth only.
Mubina Kapasi: Lovely. All right.
How do you see say if grow as a business from here? Like, let’s say if we were supposed to have this conversation five years down the line, how different do you think the business will look?
Mikdad Saleem Merchant: So in terms of growth, if you see our last few years, okay, we have been growing at upwards of 30% year on year, right? In the next five years, I want to exceed this growth. We are completely striving towards exceeding this growth rate in terms of both the top line growth as well as profitability and bottom line. And in terms of product portfolio, we are ever evolving, right? So we have got we have this entire modern range, and nothing stops us to get into, you know, more of these technology enabled solutions to get into other parts of retail design, etc.
Because the customer base is really the same. So horizontal expansion is something that can easily be explored.
Mubina Kapasi: What is the, you know, your the competitive landscape like? I mean, you know, of course, I’m sure you have a certain set client, and there must be a stickiness of that client as well. But is it a very competitive market where you are present? Who would your competitors be?
Mikdad Saleem Merchant: So retail fixtures, right, is a niche industry. And specifically, if I talk about the India landscape, there are very few organized players, right? You can count them on like on your fingers. But the thing is that there is a lot of scope for growth in retail fixtures, right? Because retail is ever expanding.
If you see, retail is poised for good growth at a CAGR of upwards of 8%. And retail interior design as a whole, which encompasses fixtures and synergies and everything that will require for retail design, that is poised at a growth of 14% CAGR. So there’s a lot of scope for expansion.
So I think there is nothing to worry about in terms of competition. I feel the few organized players, pie is big and also ever expanding.
Mubina Kapasi: Okay, lovely.
You spoke to us about the vision you have for SAFE and you know, how you expect it to grow, how you hope for it to grow. Could you tell me a bit about the team that is helping you achieve this vision?
Mikdad Saleem Merchant: Right. So Mubina, this entire business was started, as I mentioned, by Salim Merchant.
And he was the visionary behind all of this. And he’s our Chairman and Managing Director. And then we have Zafar Merchant, who is instrumental in the in-sync shop fittings, the modern innovative solutions.
It has been totally his brainchild and initiative, which is culminated into whatever we see today. Then there’s me, which is the full time director and CFO. And then below us, we have an entire hierarchy, where is for Bombay, we have the COO, Saifuddin Ratlamwala, who handles the entire Bombay operations.
For Pune, we have Satish Wable, who handles the Pune operations. Supporting both of these, we also have Shabbat Inwala in Bombay, we have Amruta in Pune, we have all the plant heads, for each of these plants, and under them, we have the entire hierarchy set. And all of them are working together to help you make Safe.
Absolutely. So it’s always a team effort, right? It’s nothing can be done alone. And this is the entire team, who has always supported us at every inflection point of growth.
When multiple changes were required, everybody has adapted to the change. And that is why Safe Enterprises is what it is today. It’s because of them.
And now we stand on another inflection point, where we are going for our IPO. So even at this inflection point, when we go for our IPO, we have gotten complete and absolute support from our team.
Mubina Kapasi: Wonderful. Okay, well, all right, Mikdad, it was an absolute pleasure talking to you. Thank you so much for joining us on Small Cap Spotlight and all the best for your IPO.
Mikdad Saleem Merchant: Thank you so much, Mubina.
Mubina Kapasi: Well, there you have it, a story nothing short of inspirational as promised. That was Safe Enterprises Retail Fixtures Limited. Thank you so much for watching.
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