Sparsh Industries pumps in Rs 400 crore as it looks at rapid expansion

New CPP line and aluminum foil plant in North India

Prashant Agarwal, director of Sparsh Group. Photo: The Packman

Kanpur-based Sparsh Industries, a flexible packaging solution providing company, is on a huge expansion mode. The company which currently manufactures polyester films (BOPET), metallized films, holographic films and polyester chips, started its business in 1996 with operations including printing, lamination and LDPE to address in-house requirements. Over time, Sparsh kept on adding capacities almost every alternate year. Backward integration has always been at the heart of the company. In order to deepen backward integration into its production process, and to provide synergy to existing operations, and lessen dependency on day-to-day ordering affairs, Sparsh added various related facilities for manufacturing ink, adhesive, coatings and holography for in-house consumption. Today, these units fulfill not only the in-house requirements but also cater to various companies in the market.

One of the two 8.7-meter BOPET lines at Sparsh. Photo: The Packman

As a part of its backward integration strategy, Sparsh Industries also runs its own cylinder manufacturing and engraving unit. At present, Sparsh’s cylinder manufacturing and engraving plant produces 1,000 cylinders every month, thus, in addition to fulfilling its in-house needs, also supplies its cylinders in the market. The cylinder unit has two electronic engravers from Hell. Sparsh uses these gravure cylinders on its five rotogravure presses in addition to supplying in the market. The fifth rotogravure press, a 9-color expertPACK 440, was installed in December 2018. Another 9-color rotogravure press is on the cards and is expected to be installed by December 2019.

One of the two Bobst metallizers at Sparsh. Photo: The Packman

Sparsh’s flagship product is Biaxially Oriented Poly-Ethylene Terephthalate (BOPET) films, commonly known as polyester films. The company exports 25% of its films in its targeted markets such as Sri Lanka, Bangladesh, North America and Europe, in addition to catering to the Indian market. At present, Sparsh has two 8.7-meter BOPET lines, installed in 2012 and 2016 respectively, from Dornier, Germany, which can produce 60,000 metric tonnes polyester films per annum. In addition, Sparsh has two Bobst metallizers producing 12,000 metric tonnes metallized films per annum. Sparsh also has a polymer plant, set up in 2015, which has a capacity of 66,000 metric tonnes per annum. These facilities are spread over an area of about 54,000 square-meter land in Kanpur.

Zero wastage… Sparsh recyles its film waste to produce reusable plastic granules. Photo: The Packman

Prashant Agarwal, director of Sparsh Group, said “Our strategy has always been to expand or diversify within our related product range in a phased manner. Our company is once again in a phase-wise expansion mode to ensure further growth. We have an immediate investment plan of about US$ 60 million in projects that will come up in two phases.”

The two 8.7-meter BOPET lines from Dornier, Germany, can produce 60,000 metric tonnes polyester films per annum. Photo: The Packman

Phase 1 – New CPP line
In phase 1, a US$ 15 million (INR 100 crore plus) project is already underway and the company has invested in a brand new 3,200 mm wide CPP production line from Colines, Italy; a 3,300 mm wide metallizer from Bobst; and a 3,300 mm wide slitter from Kampf, Germany. The new CPP line is expected to be in production by July 2019. The line has a production capacity of 750 metric tonnes per month. The metallizer which has a similar production capacity will be in production by October 2019.

According to Agarwal, the new CPP line will be the first of its kind CPP film line in India, capable of producing mono-oriented polypropylene (MOPP). “Normally, CPP films are not stretched on the production line. However, in MOPP, the film is stretched in the machine direction enabling the film to have better mechanical properties. MOPP is highly recommended and suitable for those applications which require better mechanical properties in the machine direction along with easy and straight tear propagation property,” explained Agarwal.

Phase 2 – Aluminum foil project
Under phase 2, which is already initiated, Sparsh has announced a US$ 45 million (INR 300 crore plus) greenfield project for manufacturing aluminum foils of different varieties for various packaging applications. Sparsh has already acquired 100,000 square meter land at a new location in Kanpur for the aluminum foil project.

“The demand for aluminum foils in the Indian market for packaging applications is growing at a brisk rate. However, India is yet to produce enough to meet this growing demand and is hugely dependent on imports from countries like China and South Korea. With a huge market available in India for aluminum foils, Sparsh has decided to capitalize on this opportunity and foray into the foil business,” said Agarwal.

Almost all machinery for the aluminum foil plant has been ordered and Sparsh plans to start production by end 2020. According to Agarwal, the aluminum foil plant will mainly focus on the production of light-gauge aluminum foils. “We will down-gauge 250-micron aluminum coil to 6-micron foils,” he said. The production capacity of the plant will be about 1,000 metric tonnes per month. About 30% of the production will be used for in-house consumption while the rest will be supplied in the market. “We will target FMCG and pharma sectors in addition to the house-hold aluminum foil market.”

According to a report, over 70% of aluminum foil used in India is for packaging applications. Pharmaceuticals followed by beverages, personal care and a wide range of food and non-food products, semi rigid containers and house foil are the principal applications of aluminum foil in India in the packaging sector.

Holographic division
Sparsh is also planning to revamp its holographic division by investing heavily on new state-of-the-art machines for specialized holographic films. “We develop our own holographic films with various security features but that is in a very small scale. Right now, we are producing about 200 to 250 metric tonnes holographic films per month. However, after installing the new machines, we plan to increase it to 2,000 metric tonnes per month,” Agarwal concluded.

— Mahan Hazarika