Anticipating strong demand as trade modernises, Indian packaging firm, Uflex Ltd has said its new $80-million greenfield facility in Kentucky will go on stream by this month.
“Packaging is set to leapfrog with modern trade coming into India in a big way. Currently, only 10-15 per cent of all food items and staples are sold in packaged form. There is immense scope for growth and foreign direct investment in retail will give it a thrust in the right direction,” R K Jain, Group President, (Corporate), Uflex said. Uflex, formerly Flex Industries, which was promoted by Ashok Chaturvedi in 1983, closed the last fiscal with 30 per cent growth in net revenues at Rs 4,543 crore, up from Rs 3,540 crore. The firm manufactures a variety of value-added packaging materials and sophisticated products with existing total capacity of 3,44,000 tonnes a year from its 12 units.
The company is expecting further 30 per cent growth in revenue at Rs 5,800-6,000 crore this fiscal.
“Our Poland plant has been operational since July and the Kentucky plant in the US will commence operation by this month. Our aim is to be close to our customers,” Jain said.
Asked if the slowdown in the US and European markets had taken the sheen off its business, Jain said that the overall economic environment was weak. “Overall, the economic environment is not sparkling. However, a large chunk of our customers belong to the food industry, which is largely recession- and slowdown-proof. This explains our massive expansion.”
He said the expansions have been funded by internal accruals and debts. Uflex is also present in Dubai, Mexico and Egypt among other countries.
On whether it is looking at inorganic growth, Jain said, “We are not averse to acquisition (if) there is a financial and strategic fit.” The company had last year unsuccessfully bid for global heavyweight DuPont's polyester films business.
The company has so far invested $135 million in its Egyptian plant, which has emerged as its largest operation outside India.
Uflex's market share in India is around 35 per cent of the organised segment.