Kolkata-headquartered Dhunseri Petrochem and Tea Ltd has plans to export 55 per cent of its total PET resin output across its two plants in Haldia - located 250 km southwest from Kolkata.
PET resin is a raw material used to manufacture pet bottles.
The second unit was inaugurated on Tuesday.
“With the introduction of the second plant, we will be able scale up our PET resin production capacity up to 4.1 lakh tonnes a year. Nearly, 55-60 per cent of our total output will be exported,” C.K. Dhanuka, Executive Chairman, said at the inauguration of the plant.
The company is aiming to earn a foreign exchange of nearly Rs 2,000 crore through 55 per cent export of PET resin. The second plant is being set up in technical collaboration with Germany-based Oerlikon Barmag as “EPC contractor” and “process licensor”.
Pressure on Margins
According to Dhanuka, a reduction in export incentive on PET resin coupled with implementation of West Bengal Tax on Entry of Goods into Local Areas Act, 2012, has impacted the company’s margin.
“Export incentive on PET resin reduced from 5.5 per cent to 3.9 per cent, thereby lowering the subsidy. We will have to pay an additional one per cent entry tax. Both will eat into our profits,” he said.
The company is expecting to commission its proposed PET resin manufacturing unit in Egypt by fourth quarter of FY14.