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Plastic packaging products maker Manjushree Technopack is aiming to set up two greenfield manufacturing facilities in Bangalore at a cost of Rs 150 crore to manufacture PET (polyethylene terephthalate) bottles for the food and beverages sectors by end-2012 .
The food and beverages sectors, including majors such as Pepsi, Coco Cola, Cadbury and Bisleri, consume about 400,000 tonnes of PET bottles annually, which is estimated to grow at 20 per cent in the next few years. The proposal to allow 51 per cent FDI in multi-brand retailing and 100 per cent in single brand retail is expected to further push up consumption of this packaging product.
“We have a current capacity of 40,000 tonnes, which is about 10 per cent of the domestic consumption. The two new factories will immediately add another 60,000 tonnes of capacity,” Mr Vimal Kedia, Managing Director, told Business Line on the sidelines of the IndPack conference here.
Hike in Turnover
It hopes capacity will touch 100,000 tonnes a year by 2015, mostly through expansion of the two new units . Cadbury and Coca Cola are its biggest consumers, accounting for almost 30 per cent of its turnover, which is expected to go up from Rs 215 crore (in FY11) to Rs 300 crore this year.
The new units will have a facility to convert used PET bottles into new bottles that are fit for packaging food and beverages. Currently, used bottles are being recycled but the recycled products are for non-food use, such as in chairs and furniture.
“We will be importing technology from Europe that can recycle the used bottles to produce bottles for packing food and beverages. It involves cutting them into pieces, melting and fortification with chemicals,” Mr Kedia said.
Manjushree's new facilities will have the capacity to produce 10 tonnes a day of re-cycled PET bottles.
Mr Kedia feels that prices of PET bottles will remain at current levels, after seeing a nearly 40 per cent hike in the last one year in tandem with a similar surge in prices of raw material—bottle-grade polyester.
From Rs 70 a kg a year ago, the raw material price has risen to Rs 96 at present, after peaking at Rs 105. “We do not think prices of this raw material will see any sharp increases in the coming months, especially as globally demand is slack in this period,” he said.
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