HNG Float Glass, maker of toughened and insulated glasses for automobile and construction industry, had found competition too hot to handle soon after it started operations in 2010 due to a crowded marketplace and competition from market leader Saint Gobain.

Its predicament has been revealed during a detail investigation by Competition Commission of India (CCI).

While CCI hasn’t found truth in HNG Float’s allegations of “anti-competitive and abusive market strategies by the dominant player Saint Gobain Glass India”, the inquiry has brought into light the functioning of the float glass market.

HNG Float hasn’t been making losses but alleged that its revenues and profits were lower than they would have been in the absence of Saint Gobain’s “unreasonable pricing”.

HNG Float was set up with a plant at Halol in Gujarat in 2010 by listed entity, Hindusthan National Glass & Industries.

Shortly after starting production, HNG Float complained that Saint Gobain was allegedly charging unreasonably low prices in the clear float glass segment, bringing down the market prices by 13% from October 2010 to April 2011. “While prices started increasing after April 2011, in June 2011 they were still below the levels that prevailed in October 2010,” HNG said.

"While the variable cost has been increasing, the prices of clear float glass have been decreasing which is in contradiction to what one would expect,” it said.

HNG also complained of other steps to kill competition by Saint Gobain like resorting to bundled sales and arm-twisting of dealers, moves which allegedly helped the market leader gobble up competitor Sezal’s float glass assets in March 2011 after which its market share jumped from 25% to about 40% overnight.

CCI then in October 2011 asked its Director General to investigate the allegations, following which a report was filed this February.

When the DG’s report didn’t find substance in HNG Float’s allegations, the company claimed that the investigation wasn’t done in a comprehensive way and asked CCI to re-examine.

CCI has now come out with its final order, which, while agreeing with most of the findings, fundamentally differed from DG’s view that Saint Gobain was in a dominant position. “The trend of change in market shares indicate a competitive industry…the industry saw entry of three new firms, namely Gold Plus, HNG and Sezal in a very short span of time, which points to the ease of entry in the market,” CCI has said.