Emami Paper MillsBSE 19.91 % Ltd is foraying into the packaging board business with a new Rs 1,000 crore multi-layered coated paperboard production facility at BalasoreBSE 1.75 % in Orissa.

Part of the Kolkata-based Emami Group, the company plans to start commercial production of packaging board next month, which has been on a dry run since April with production capacity of 1.3 lakh tonnes per annum. Emami Paper Mills is primarily in the business of newsprint production.

Emami Paper Mills CEO PS Patwari said demand for paperboard in the country is largely driven by e-commerce.

"The present requirement of superior packaging board in India is close to 17 lakh tonnes annually , out of which India's capacity is only 7 lakh tonnes," he said. He said there is an immense growth opportunity in the segment, with high end paperboard market growing at 15% annually.

In full capacity, this new paperboard manufacturing business will produce 1.5 lakh tonnes of paperboard Rs 700 with a turnover target of close to crore.

This plant will produce coated folding box boards, solid bleached boards, cup stock board and recycled grey and black back board, which cater mostly to FMCG, pharma and hosiery sectors. The company is also in talks to export them to Thailand, Bangladesh and Sri Lanka.

Emami Paper Mills is looking at further expansion in its Balasore facility. "We are looking at doubling our capacity in three years," Patwari said, for which the company will pump in an additional Rs 1,000 crore.

In the long run, Emami Paper Mills is targeting 20% share in the high end paperboard market.

Source :economictimes.indiatimes.com