Uflex's Rs 250 cr rights issue likely by Sept

Flexible packaging firm Uflex plans to raise around Rs 250 crore through a rights issue by September to support its expansion plans and repay loans, a top official of the company said.

"We plan to raise around Rs 250 crore through a rights issue by September, 2010. A part of the fund will be used to repay loans while the remaining will be used for business expansion," Uflex's Group President Finance & Accounts R K Jain told PTI here.

The Board of the company has already given its nod for the rights issue, he said.

Backed by a good growth in the domestic packaging industry, Uflex is eyeing to achieve a market share of 35-40 per cent over the next two years, Jain said.

The company has lined-up a capex of Rs 1,150 crore over the next two years to strengthen its global presence and consolidate its position in the domestic packaging market, Jain said.
   
"We plan to invest around Rs 1,150 crore over the next two years to set up a new unit overseas and also to enhance capacity of our existing facilities in India," he said.
   
Also, Uflex plans to increase its packaging capacity to 79,000 Tonne Per Annum (TPA) by 2012 from the current capacity of 54,560 TPA, Jain said.
       
The Rs 15,000 crore domestic packaging industry is growing by 15-18 per cent on rising demand for flexible packaging products in FMCG and pharma segments, Jain said.
       
As compared to this, on a year-on-year basis, Uflex is growing by 25 per cent.
       
The BSE-listed company offers packaging solutions to more than 800 companies, including Unilever, Pepsi, Procter & Gamble, Colgate, Nestle, ITC, Hindustan Petroleum, Indian Oil, Britannia and Dabur.
       
Moving ahead, it plans to set up a new manufacturing facility in Egypt, which is expected to get operational by this month-end, Jain said.
       
At present, Uflex has three manufacturing units -- Jammu, Noida and Gwalior -- in India, and one each in Mexico and Dubai.