On 24 November 2016, Bangalore-based rigid packaging firm, Manjushree Technopack, announced acquiring its Delhi-based competitor Varahi Limited to get access to a base in Northeast and making it the largest supplier of rigid plastic packaging products in the country. The strategic move, a first for India’s largest PET and preform manufacturer, widened its lead as the largest supplier of rigid packaging in India.
Manjushree now has six manufacturing units across India with a total production capacity of 1 billion units per annum. Manjushree’s client portfolio boasts of top FMCG brands in India including the likes of GSK, Coca-Cola, Nestle, Mondelez (Cadbury) and others. The acquisition will get it access to 100 new customers including Dabur, Patanjali and SC Johnson and expand its revenue to over Rs 800 crore, the firm said in a statement. Manjushree did not disclose the cost of the acquisition.
Varahi was founded in 1971 by late HR Sanghavi. It offers rigid packaging solutions for FMCG, beverages and pharmaceuticals companies. Its manufacturing units are located in Noida, Baddi and Pantnagar with a combined production capacity of 20,000 metric tonnes.
Announcing the acquisition, Vimal Kedia, managing director, Manjushree Technopack said, “This is a significant milestone for Manjushree as it marks our first strategic investment. Varahi has a 40 year old legacy and we were impressed by their manufacturing capabilities. With this acquisition, Manjushree gets a solid foothold in north India and cross-selling products of between Manjushree and Varahi’s customers will give us optimum growth. Our aim is to become a 360 degree rigid packaging solutions provider for brands across India and this gives us impetus to serve our existing and new clients with world-class packaging solutions. We are excited to have team Varahi on board.”
Manjushree will boost its sales by gaining access to registered designs and patents filed by Varahi. The Bangalore-based company now owns over 300 registered designs and patents, which will allow it to produce 5 to 20 litres PET units in 1,000 different designs.
Indian plastic packaging industry’s output is expected to touch 17.6 million metric tonnes in 2016-17. PET (Polyethylene terephthalate) is most common polymer resin used for packing food, beverages and medicine. It accounts for almost 10% of the total output at about 1.8 million metric tonnes. The demand for polymers, particularly PET, has been growing at 10 to 12% CAGR in the last decade and is expected to hold the trajectory. India’s per capita PET consumption is 0.6 kg while the global average is of 2.9 kg. Manjushree has a production capacity of 1,00,000 metric tonnes, roughly 12.5% of total PET demand in India.