Manjushree Extrusions embarks on backward integration

Bangalore-based Manjushree Extrusions Ltd, a maker of speciality plastic packaging products, is embarking on a backward integration project to expand its business.

The company, which is supplying PET bottles to a large number of FMCG, pharma and food processing companies, is expanding production capacities at its Bangalore plant at an estimated cost of close to Rs 54 crore.

Manjushree is setting up a unit to manufacture preforms which is used to make bottles and jars of different sizes and shapes. The company will buy plastic granules from Reliance and produce preforms at its Bangalore facility and supply them to large volume consumers.

Till now, the company was manufacturing only PET bottles and supplying to their customers. Preforms are used by mineral water companies, soft drink and fruit juice makers, Vimal Kedia, Managing Director, Manjushree Extrusions said.

He said the company has imported a special purpose machine from Canada for the purpose and the plant will start production in April 2008.

The company's products include injection/blow moulded PET/PP and multiplayer plastic containers. Its major clients include Hindustan Unilever, Nestle, Cadbury, Britannia, Glaxo SmithKline, P&G, Coca Cola, Tata Tea, Godrej, Hershey's, UB Group, Pepsi among others.

Manjushree is increasing the existing manufacturing capacity by 10,100 metric tonnes per annum, comprising of 2,260 metric tonnes of containers and 7,840 metric tonnes of preforms thereby raising the overall manufacturing capacity of specialty plastic containers and preforms to 14,240 metric tonnes per annum.

Of the proposed investment of Rs 53.70 crore, the company is raising Rs 35.70 crore from the rights-cum-public issue and the remaining is borrowed from State Bank of India, Kedia said.