PETpla.net Insider 03 / 2017

TRADE SHOW REVIEW PET planet Insider Vol. 18 No. 03/17 www.petpla.net 40 Bangalore conquers the north of the subcontinent - an interview with Manjushree Technopack The next Big Bang in India’s packaging industry by Kay Barton Manjushree catapulted its pres- ence to a total of seven production sites for nearly the whole Indian market in a very short space of time. Its production level has risen to an annual output of 4 billion units, which corresponds to a share in the PET market of 15%. Its acqui- sition of Varahi has brought with it four new production sites, located in Baddi (Himachal Prades), Pant Nagar (Uttarakhand), Noida (Uttar Pradesh), and in the capital Delhi. The four plants contain more than 200 machines. With the takeover, Manjushree’s client base has grown by more than 100 companies; turnover for 2017 is forecast to be approaching USD120 million. PETplanet Insider: Rajat, we have known each other for a while now and I have witnessed quite a few developments in Manjushree Technopack. We met as recently as the spring of 2016 in Banga- lore, with the intention of writing a story on your new preform facility in Bidadi. Now, just a few months later, you take over Varahi. How did this happen and what does it mean? Rajat Kedia: Yes, it’s a big deal! In our objectives for 2020 we had originally aimed for a turnover of USD180 million but it became clear to us that this target would not be reached with our existing locations in and around Bangalore. We have only supplied the south of India until now, so expanding and going to the north was the logical conclusion. Our old and new clients have, for some time, been longing for this in principle. PETplanet Insider: What do you mean longed for? Where did difficul- ties arise in the past? Rajat Kedia: Transport is the main problem. The distances and the related costs as well as the effort are naturally anything but trivial. Supplying the north from our headquarters in the south was not possible. We had already lost a few business opportunities because we were not a pan-India supplier with geographically strategic manufactur- ing locations. So it was a strategic decision; we now have a presence in both the north and south and, along with existing clients who want to process our products in their facili- ties in the north, we are confident of acquiring up to ten clients who will be entirely new to us. The first large client is already on board for the new facilities; this connection alone is expected to generate around USD7.3 million in the next half year. PETplanet Insider: This sounds positive on the one hand but, on the other hand, it also sounds like an insane amount of work for you and a huge change in a short space of time. How did the idea and implementation of a takeover come about? Why not just build from scratch? Rajat Kedia: We naturally dis- cussed and deliberated for a very long time. Either way, we needed to open up to the north to grow. Build- ing new facilities wasn’t an option – at least; not with our revenue target for 2020. When you build a new factory, you have to wait ten years before a plant can generate a turno- ver of USD10-12 million.The deci- sion to go for the takeover devel- oped from this situation. The idea incidentally came up one Sunday morning during a family discussion (laughs). We had the first meetings with the Varahi management team in October 2015. It took a year from then before we and they had final- ised all the terms. PETplanet Insider: So now you have suddenly achieved an immense growth of directly applicable machines and can get started with production directly. Or will you simply carry on with your brands, almost without any great expenditure? For those who had not noticed or had not guessed, the news from Manjushree Technopack at the end of November 2016 caused quite a sensation. Manjushree, a PET proces- sor from Bangalore, the capital of Karnataka in Southern India, announced that it had taken over its North Indian competitor Varahi Limited, a medium-sized company with 45 years of experience in the plastics processing sector. We met Director Rajat Kedia at drink technology India (dti) in December and took the opportunity to enquire further about the acquisition and to discuss the strategic back- ground and objectives of this enormous step. Rajat Kedia, Director Manjushree Technopack