SIG to invest Rs 360 crore on 2nd phase of plant expansion in India

With the new tranche of fund infusion, the total investment of SIG at the Ahmedabad-based plant will increase to Rs 1,168 crore

Global packaging solutions provider SIG will invest 40 million euros (around Rs 360 crore) in the second phase to increase capacity of its plant in India, a "key growth market" for the Swiss multinational, a top company official said.

With the new tranche of fund infusion, the total investment of SIG at the Ahmedabad-based plant will increase to 130 million euros (around Rs 1,168 crore), including the 90 million euros of investments during the first phase.

"Phase II has been activated now, the board has already approved 40 million euros. This confirms that we are in line with our mid-long term plan," SIG President & General Manager, India, Middle East and Africa, Abdelghany Eladib told PTI.

Work on the second phase would be completed in the next three years by 2027, he added.

Phase I of SIG, a global player in aseptic packaging and filling solutions, has been completed in just 20 months. Its current production capacity at Ahmedabad is 4 billion packs per annum, and with subsequent investments it has plans to ramp up the annual output to 10 billion packs.

This will not only serve the domestic demand but also cater to export opportunities in the neighbouring markets after the second phase is operational, said Eladib.

SIG, which has over 50 packaging machines deployed at leading companies, including Amul, ITC, Coca-Cola, Parle and Varun Beverages, is looking at dairy and juices as its growth drivers.

"In five years, we have more than 50 fillers (machines) in the field across all the major players of both NCSD (non-carbonated soft drinks) and dairy, which is a success story," he said, adding, "We brag about India, for us, it is a key growth market."  According to Eladib, in 2022 the dairy market in India was estimated in the range of USD 150 billion, which is expected to be doubled four years later.

"You don't see that happening anywhere else in the world," he said, adding only 10 per cent of the dairy market is packed and offers a huge runway for growth.

Besides, SIG is also taking attempts in the pharma industries, where it will provide panicking solution of ORS and pro-biotic drinks.

"A very important consumer demand is coming from health sector," he said, adding that SIG is providing affordable packaging solution to the sector as spouted pouch besides carton packaging, which will help retain nutritional values.

Asked whether the recent consumption slowdown in FMCG and consumer goods sector had any impact on SIG's business in India, Eladib said: "We are here for a long term.

"We have to understand that seasons, environment, pressure from currencies, availability of financials will never change our determination to continue to grow," he added.

SIG entered the Indian market in 2018 and its CEO told PTI in September 2023 that he expects the country to be among the top ten markets globally.

"India has a great talent, we are leveraging it, not only in our factory but in the whole supply chain. Definitely India, at some point of time, will be an export hub, first to the regions around so the Indian subcontinent, but absolutely to the rest of the continent," Eladib added.

Vandana Tandan, Head of Market India and Bangladesh at SIG, said the company is expanding its presence in the country. It is also working to increase visibility and awareness about the brand SIG.

In India, SIG is growing with a 60 per cent CAGR (Compound Annual Growth Rate), she added.

SIG competes in India with its Swedish rival Tetra Pack.

Founded in 1853, SIG is headquartered in Neuhausen, Switzerland, and is listed on the SIX Swiss Exchange. In 2023, SIG produced 53 billion packs and generated 3.2 billion euros in revenue.