JK Paper today said it expects its total production capacity to increase by nearly 50 per cent to 4 lakhs tonne per annum with its new plant in Orissa becoming operational by the end of next year.

The company, which produces nearly 2.67 lakh tonne of paper now, expects to touch 4 lakh tonne mark by the end of 2012 when its Rs 1,650-crore expansion at the Rayagada in Orissa gets over.

“With the new facility in Orissa getting operational, we expect our capacities to touch 4 lakh tonne per annum from the present 2.67 lakh tonne,” JK Paper Managing Director Mr Harsh Pati Singhania told PTI.

JK Paper is in the process of setting up a pulp mill and a paper machine in Orissa.

One of the leading producers of office paper, coated paper and high-end packaging board paper in the country, JK Paper has 28 per cent market share in office paper, 26 per cent in packaging board paper and 16 per cent in coated paper in the domestic market.

As per industry estimates, the Indian paper market is valued at around Rs 40,000 crore per annum.

“The new facility will give us more capacity, better quality, better environmental standards and at the same time reduce operating costs,” Mr Singhania added.

Commenting on the recent buyout of Andhra Pradesh Paper Mills by the US-based International Paper Company, he said that it will lead to better valuation of Indian paper firms.

“Indian paper industry has been grossly undervalued. The deal reflects a better valuation of the industry. It will (International Paper-APPM deal) help domestic paper companies to raise better funds,” Mr Singhania said.