Emami Paper earmarks over Rs2,000-cr for expansion

Emami Paper earmarks over Rs2,000-cr for expansion

Mumbai: Emami Paper Mills, a part of the Kolkata-based Emami Group, has earmarked an over 2,000 crore investment for capacity expansion and a foray into the pulp and writing paper segment, a top company official said.

While the capacity expansion from 450 tonnes per day (tpd) to 750 tpd will be done this fiscal itself at an investment of 550 crore, the foray into the pulp and writing paper segment will involve an investment of around 1,500 crore over three years, the official said.

Emami, which currently manufactures newsprint, has two units in Kolkata and Balasore (Orissa) with a total capacity of around 450 tonnes per day (tpd).

“We are currently manufacturing only newsprint but we are plan to enter into pulp and writing paper-making by 2013. We have already acquired 350 acres of land at Balasore, where we have our newsprint unit. We will start construction once we get the requisite approvals," Emami Paper’s executive director, P S Patwari, told PTI.

The company is presently awaiting a clearance from the ministry of environment and forest (MoEF) and expects to get it by March end, he said.

Asked how the company proposed to fund the 1,500 crore foray, Patwari said a decision on the matter would be taken soon.

"We will take a decision on that soon. We might go for a public issue,“ he said.

The writing paper unit will have a production capacity of 1,50,000 tonnes per annum and the company plans to get raw materials such as wood and pulp from its own plantations.

“We have started contract plantation over 25 hectares of forest land for eucalyptus and bamboo. These plants will take another three-years to mature after which we can start production. We are also planning to increase our acreage," Patwari said.

The company’s decision to enter the paper market assumes significance as the industry expects about 10,000 crore investments in it over the next four to five years while paper production is likely to double to 22 million tonnes in the next three years.

Upbeat on the growing industry, Patwari said the company was eyeing a 800 crore revenue by FY 13 (from the present 450 crore), fuelled by the capacity expansion at its existing units.

The domestic newsprint market held healthy prospects over the next few years with growth mainly emanating from the print media, he said.

This fiscal, the BSE-listed company is eyeing a 450 crore sales, he said.