Essel Propack Ltd, a provider of plastic tubes catering to the fast moving consumer goods and pharma sector, has set its sights on the global $22 billion tubes non-oral market.

In a bid to propel growth, the company, which is part of the $2.4-billion Essel Group, is looking to increase the contribution of non-oral care in its total revenue from 39.1 per cent in FY-14 to 50 per cent by FY-16.

Non-oral care categories are dominated by toiletries, skin care and shampoo manufacturers, who use laminated tubes as packing material.

The contribution of non-oral care in overall revenue increased to 41.9 per cent in the first half of FY-15.

The spike in non-oral revenues year-on-year helped take the company's share to an all-time high of 30 per cent, pointed out analysts.

They said that though oral care is anticipated to remain the cash-cow and log stable revenues and a compound annual growth rate of seven per cent over the next three years, the company has decided to sell more tubes to the non-oral care sector, and has put in place capacities and capabilities required to handle the growth of the non-oral care business.

European contribution

“The slowdown in FMCG sector has affected the company's India oral care performance. Volumes grew just four per cent year-on-year. However, Europe has returned to a quarter of strong growth," said an analyst tracking the company.

The European region contributed over 12 per cent to the consolidated topline, largely due to the stabilisation of the Poland unit and addition of new clients in various geographies.

The Polish unit is a hub for extruded plastic tubes. It is also expanding into laminated tubes.

Currently, in volume terms globally, Essel Propack holds oral care market share of 34 per cent. Essel Propack sells more than six billion tubes and has units operating across countries such as the US, Mexico, Colombia, Poland, Germany, Egypt, Russia, China, the Philippines and India.

Related Topics