SLMG Beverages, a leading franchise bottler for Coca-Cola in India, plans to set up a PET bottle recycling plant in joint venture with Maharashtra-based Dalmia Packaging with an investment of ₹90-100 crore.

The recycling plant will have an annual capacity to recycle food grade plastic of 36,000 tonnes and produce 24,000 tonnes of plastic to produce PET bottles which will account for 20 per cent of its sales.

SN Ladhani, Chairman & Managing Director, SLMG Beverages, said in the next couple of years the government will mandate all the plastic product producers to mandatorily use recycled plastics in their production lines.

In the western countries, the use of recycled plastic is as high as 50 per cent but in India the company expects it to be about 30 per cent, he said.

Plastic sourcing

Earlier, recycled plastic was not used for food grade products, but now there are good technologies available in Germany, Japan and US to ensure that the recycled plastic are as good as virgin plastic, he said.

The biggest challenge in plastic recycling is in collection of discarded plastics bottles. SLMG is banking on its JV partner Dalmia Packaging to handle the plastic sourcing for recycling as it is already in that business.

The company has already identified the land between Lucknow and Kanpur for setting up the unit and is in the process of ordering the machinery.

“We have written to the central government for getting the same concessions extended to recyclers in other industries. We expect to start production in two years,” he said.

In a bid to professionalise the operations and tap the capital market in next 2-3 years, SLMG has appointed Coca-Cola veteran Costin Mandrea as CEO.

With seven plants and 41 crore bottling capacity per day in Uttar Pradesh, SLMG supplies 90 per cent of Coca-Cola bottles in the State. It handles entire demand for Coke in Uttarakhand and has presence in Bihar and Madhya Pradesh.

It caters to more than 300 million people through its 1.5 million outlets and a network of over 1,500 distributors across all the four States in the north.

Mandrea has drawn plans to make each bottling plant to specialise in bottling one particular drink of Coca-Cola and drive cost efficiency using artificial intelligence in transportation of finished goods.