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Ballarpur to invest Rs1100 cr on capacity expansion

Ballarpur to invest Rs1100 cr on capacity expansion
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First Published: Tue, May 08 2007. 02 29 PM IST
Updated: Tue, May 08 2007. 02 29 PM IST
By Reuters
Mumbai: Paper maker Ballarpur Industries Ltd plans to invest Rs1100 crore in the next two years to expand paper making capacity by about 3,00,000 tonne, a senior official said.
The company aims to become a $1 billion (Rs4,076 crore) company with a capacity of 1 million tonne by 2010, managing director R. R. Vederah said. It now has a capacity of 465,000 tonne per annum and a pulp making capacity of 95,000 tonne.
“We are on the anvil of a major paper consumption growth in the country in the short to medium term,” he said at an investors’ meet late on 7 May. Vederah said he expects per capita paper consumption in India to go up to 15-20 kg in the short term, from around 7 kg now.
The firm, which makes writing and printing paper, plans to export 25% of the incremental capacity. Currently, 5% of its turnover is from exports. It also expects earnings before interest, depreciation, tax and amortisation (EBITDA) to more than double to Rs1,200 crore in three years from about Rs550 crore now, he said.
Ballarpur plans to increase its share of branded retail products and has expanded its market reach by adding more distributors for its stationery products. “We don’t want to be considered a commodity product. It helps to build the brand BILT,” he said.
It also plans to expand its hygiene product offerings, such as facial tissues and kitchen towels. “This is another segment which in the next 10 years is going to see major growth,” he said.
In June, Ballarpur along with JP Morgan Securities (Asia Pacific), bought the forestry and paper business of Malaysia’s Lion Forest Industry Bhd. The acquisition would help raise capacity and save costs, said Vederah, adding that pulp-making is 40% cheaper in Malaysia than in India.
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First Published: Tue, May 08 2007. 02 29 PM IST
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