Cosmo Films to invest Rs 120 crore for expansion

Cosmo Films, a plastic packaging products manufacturer, has chalked out a greenfield-cum-brownfield expansion plan at its manufacturing facilities at Baroda with an investment of Rs 120 crore.

Under this plan, the current capacity of BOPP films of 56,000 tonnes is proposed to be increased to 136,000 tonnes. The production capacity of 24,000 tonnes of value added film is set to be hiked to 33500 tonnes. These plans with additional capacities are likely to become operational by 2010; thus making it one of the largest players in this segment.

In the packaging sector plastic packaging has grown the fastest in the last two decades. Today, plastic packaging accounts for 34 per cent of the total packaging industry with flexible packaging forming a major part of the segment and will play a prominent role in this growth journey.

Growth in FMCG and food processing sector, opening of food processing parks & focus on value added specialty products like multi-layer barrier laminates have added to the market demand for BOPP film. Globally the converted flexible packaging market is expected to attain targeted growth of  $35.5 bn approx by the next 2 years.

Globally the "migration effect" from mature western regions is visible with North America/Europe and Japan which constitutes 33 per cent of global BOPP industry compared to 70 per cent in 1990. This figure was 52 per cent in 2000 which indicates a downward trend in BOPP manufacturing in Western countries. High growth areas such as Eastern Europe, Africa/Middle East have a relatively low production base and hence countries like India have immense scope.

Cosmo Films made an investment of Rs 15 crore towards procurement of 2400 mm wide metallizer for further capacity addition in its metallizing business. The metallizer will be operational by March 2009. This metallizer has advanced features with a speed of 840 metres per minute. The plasma treater an additional component to the metallizer will help in improving the bonding between film and metal.
For the financial year ended March 31, 2008, the company reported 33.71 per cent rise in revenue to Rs 186.93 crore from Rs 139.80 crore. Similarly, net profit grew 59.73 per cent to Rs 14.52 crore from Rs 9.09 crore.