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Manjushree diversifies into flexible packaging

Indian packaging group Manjushree Technopack clocked a turnover of 635 crore INR (97m USD) in 2016-17 financial year as against 546 crore INR (83.4m USD) the previous fiscal. The company witnessed a growth of 15 percent year on year, with six percent of the total revenue being contributed by exports.

The company’s growth has been fueled by the acquisition in 2016 of Delhi-based Varahi Polymers with factories in Noida, Baddi and Pantnagar. According to a national daily, this deal was estimated at 350 crore INR (53.5m USD) and gave Manjushree access to Varahi Polymers’ factories, assets and intellectual property rights. ‘The acquisition has given us significant presence with customers in North India and has added to our growth. We have acquired new customers such as Dabur, SC Johnson, Perfetti Van Melle and Patanjali,’ says Vimal Kedia, managing director at Manjushree Technopack. Varahi is expected to contribute 250 crore INR (38.2m USD) to Manjushree’s turnover in the current fiscal. 

Flexible packaging 
To cater to the growing needs of its customers base, Manjushree, one of the largest suppliers of rigid plastic packaging products in India, has diversified to manufacture shrink films that help the company cater to wider requirements of its customers. Manjushree has a total production capacity of 132,277 tons per annum of PET which is estimated to be 12.5 percent of the total PET market in India. However, Kedia says, ‘Any industry has to continuously invest and plough back earnings to expand their operations. The investment in new technologies is very important to keep abreast with new trends in the market as well as to improve efficiencies.’ 

Kedia explains the diversification is a natural progression: venturing into shrink film packaging allows the company to be a 360 degree packaging provider to its clients: ‘Many beverage manufacturers have moved from traditional glass bottles to PET due to its economical and sustainability benefits. The rise in the demand for PET bottles contributed to the need for transporting them in bulk. The bulk transportation of PET bottles was earlier carried out in corrugated boxes is currently witnessing a great demand for shrink film packaging to replace the boxes. Shrink film packaging guarantees protection against moisture, dirt, dust and theft. It offers perfect stackability and maximizes loading capacity. Shrink film serves the same purpose of holding several product packs or bottles together and costs one-third of corrugated boxes while also improving the aesthetic appeal of packaging.’ 

The shrink film plant is equipped with new generation multi layer blown film line from German manufacturer Reifenhauser. It is capable of producing high quality shrink film consistently with a production capacity of 450 tons a month. Currently, the machine ¬produces about 16 tons of 60-micron film every day. However, the production varies depending on the micron of the film produced, as the company produces films ranging from 25 to 180 micron. 

The machine is capable of extruding and laminating three different layers of raw material, thereby forming a multilayer structure as opposed to a conventional monolayer technology. The multilayer structure in shrink film gives a better tensile strength at lower thickness. Therefore, the overall cost to the customer is reduced. 

Manjushree further plans to increase production capacity by adding a second machine by 2018 due to fast growth of this market in India. ‘This market is growing at 25 percent CAGR. This growth is led by several beverage majors, 50 percent of whom have made a shift from traditional corrugated boxes to multilayer shrink film packaging,’ says Kedia. As an example, he explains, ‘Cola manufacturers have phased out corrugated boxes and packing PET bottles in shrink film. This helped them curb their cost of tertiary packing by 80 percent. Similarly, a lot of companies are looking to replace honeycomb partitions or separators which are used in corrugated boxes with shrink film as it serves the same purpose at half the cost.’ 

Further, Manjushree sees growing demand of in-mold labels and has been working with machine suppliers to customize label applicators for efficient application of in-mold labels. The company worked with Dabur, for instance, for shifting Sanifresh bottles from pressure-sensitive labels to in-mold labels. That was the first time in India that IML technology was used on bottles’ angular neck. The company is not printing in-mold labels in-house, as Kedia explains: ‘Label printing requires a different DNA and Manjushree’s expertise lies in rigid packaging.’ 

With wider product portfolio, the company is now focusing on exports in the Middle East, Africa and other markets in Europe. It is already exporting its products to these markets and will open marketing offices in Middle East and Africa by January 2018. Manjushree eventually foresees the opening of a factory in one of these regions in the future. 

ERP and automation 
To better manage its large operations, Manjushree has implemented ERP for production, supply chain management and finance. The company uses Microsoft Navison ERP system executed by Flexibiz ERP. 

Kedia explains that the ERP has helped Manjushree to extract value and data on time. ‘It has helped the company in harnessing data analytics to analyze sales. ERP has also helped us in predicting requirement and align actions according to prediction. It provides information on time and has improved the company’s forecasting ability as well as monitoring capabilities.’ 

The company is standardizing its equipment and suppliers to achieve more efficiency. Automation has helped the company reduce manpower requirements and avoid customer complaints. ‘There is five to seven percent increased productivity with automation. 

However, the ROI is extended due to heavy investments,’ says Kedia. Manjushree is evaluating a system for automatically placing and packing bottles inside a carton without human intervention, adapting to the trends of Industry 4.0. 

ABOUT THE AUTHOR

Aakriti Agarwal is India and Southeast Asia editor for Labels & Labeling.

Aakriti has been India editor for a number of years, and editor of the online newsletter, Label News India.

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