Packaging Industry in India

Total Packaging, Processing and supply chain phase

Packaging Industry• Overview & Market Potential• Market Dynamics• Thriving Industries• Packaging Investments & Future• Packaging Framework• Packaging Events & News• Packaging Key players – Global & India• Technologies - Services

Packaging - Main Product Groups• Production of packages and package means•

Packaging materials, packaging means, packaging aids•

Packaging machines and devices•

Machines and equipment for finishing packaging materials•

Machines and equipment for printing of packaging materials•

Automation technology / Complementary techniques i.e. RFID ,Barcoding etc•

Environmental technology / Packaging recycling•

Storage, logistics and transport equipment•

Services

Overview• Indian Packaging Industry , growing at annual rate of more than 15%, is valued at $24.6 Billion

– Sixth largest in world• Size of world packaging Industry is $ 600 Billion. Next Five years, projection is triple around $

60 Billion.• Indian Packaging Imports are $125 Million. Import duty is 25.58%

Indian packaging machinery exports are rapidly growing• India’s per capita annual packaging expenditure was USD 20 in 2011, which is significantly

lower than the top 20 market average of USD 347.6. The low per capita expenditure offers a huge business opportunity for packaging companies.

• India’s per capita consumption of packaging is only 4.3 kgs whereas neighbouring Asian countries like China and Taiwan show about 6 kgs and 19 kgs, respectively

• Highly fragmented industry – Large packaging companies -50% business• Two types of packaging – Rigid (conventional -paper/cartons, metals) and Flexible(advanced – plastics, textiles, wood) Infact, Plastic are most used @49%• More technology driven now – For security & labelling - RFID, AIDC,barcoding• Competitive Landscape : Both International and Indian Companies are key players. • Germany and Italy are the latest suppliers of packaging machinery to India but focus is now

shifting to Taiwan, China and Korea

Packaging Industry – ImportsThere are about 600-700 packaging machinery manufacturers, 95% of which are in the small and

medium sector located all over India.

Germany45%

Switzerland3%

Italy14%

USA8%

Sweden16%

Southeast - Taiwan/ China14%

Imports - Machines

Key Drivers• Retail Growth and Increased Consumerism• High Demand from Food and Beverage Industry• Rise in FMCG Sector• Increase in cargo traffic handled at major ports• Rising Exports• Growth in pharmaceutical market • Increasing demand from rural sectors• Logistics advantage• Growth in per capita income, changing lifestyle patterns ; health conciousness• Rural markets

Packaging : Enormous Growth• Food & Beverage : A thriving industry with a large untapped potential : The Indian food processing

market is one of the largest in the world in terms of production, consumption and growth prospects.

• Pharma : Opportunities for Growth post WTO Regime• Organised Retail : Proliferation of malls and Supermarkets. the Indian retail market is the 5th largest retail

destination, globally and has been ranked the second most attractive emerging market for investment. The market is currently valued at USD 350 million and is expected to rise to USD 1.3 trillion by 2015.

• Automation: Triggering growthTechnologies to improve business efficiencies and competitiveness…AIDC, RFID, Barcoding, Smart Cards

Packaging Industry in India is driven by Pharma and food processing industry..

• Metal Cans and glass bottles have lost large markets to rigid & flexible plastics and printed monocartons• Flexible Packaging has replaced all forms of rigid packaging ; many

innovations – single use unit pack is now globally acknowledged as marketing first -Bags and Pouches ,Squeezable Bottles ,Stand-up Pouches ,Medicine Bottles ,CD Cases ,Foam Packaging ,

Laminated TubesLaminate tube has almost entirely replaced the aluminium collapsible tube for toothpaste packaging; now inroads to pharma sectors• PET Bottles and jars have made spectacular entry in indian market –

annual growth rates of 20% plastic closures replacing metal closures• PET bottles are used for mineral water, edible oil, carbonated soft drinks

etc

Changing Consumption PatternsProduct Conventional Packing Current Packing Trend

Milk Glass Flexible Pouches, Tetrapak

Beverages Glass Tinplate Aluminium PET Bottles, Cans

Toothpaste Aluminium Tubes Laminated Tube

Soap/Cosmetics Paper cartons Laminated Cartons, PET

Shampoo Glass Sachets, Plastic container

Shopping Carry Bags Paper, Jute High density plastic

Edible Oil Tinplate containers Flexible Pouch, Tetra packs

Fertilisers Jute Woven sacks

FMCG and Food Industry

Food and FMCG industries are the largest consumers of flexible packaging products; Segment is growing @ 104% and expected to be USD 500 Bn by 2020

Food accounts for 38% (6th largest in world) India ranks globally in production of milk and pulses & second in production of Tea, Fruits & Vegetables

Consumption of ready-to-eat food & busy lifestyles, other demographic factorsExports Growth - Processed Food 20% ; Spices 30%Fruits/ Veg 15% Meat Preparations 25%

Development of cold chains , Food Mega Parks & Government Vision 2015 Plan set targets for value addition . India's per capita packaging consumption is less than $ 15 against world wide average of nearly $ 100. New Investments announced

Pharma Sector – Benefited by Packaging

The sector is growing at a rate of over 13 per cent annually and is estimated to be worth $ 6 billion.

Indian pharmaceutical industry ranks 4th in terms of volume (with an 8 per cent share in global sales) globally and produces 20-24 per cent of the world's generic drugs (in terms of value).

The industry ranks 17th with respect to exports value of bulk actives and dosage & is the third largest FDI-attracting sectors in India.

India has the largest number of FDA-approved manufacturing plants outside the US. The country has close to 100 such units.

Low cost of production (Low R&D costs)

Innovative scientific manpower

Strength of National Laboratories

Increased outsourcing of manufacturing processes to India with supported clinical trials

Packaging Industry : Dynamics ahead…Project Announcements :

Company Product Investment USD Million

Description Location

Jindal Polyfilms Flexible Packaging

355 Expansion; to be completed in 2015-16

Nasik

Uflex Flexible Packaging

150 Approval for setting up new facilities

Kentucky, USA

Essel Propack Laminated Tubes

Relocated to new facilities

Mexico

Manjushree Technopak

PET Bottles & Preforms

31 TPA to 65,000 TPA Harohalli

Tetra Pak Asceptic packaging

156 Green Packaging Chakan, Pune

Major Packaging Events in India - 2015• PackPlus 2015 – DEL, July 2015 (over 500 SMEs)www.packplus.in/exhibitors.htm • World Packaging Congress 2015 - BOM, Oct,2015• India Packaging Show 2015 – BLR, April 2015• PackEx India - DEL Sept 2015• IndiaPack 2015 – BOM, Oct 2015• International PackTech India 2016 – BOM,

Dec,2015

Packaging –Infrastructure• Indian Institute of Packaging, BOM - Autonomous body under Ministry of

Commerce, GOI www.iip-in.com and looks after Training & Development and Research in industry. It organises INDIAPACK – annual packaging event in India

• Packaging Industry Association of India (PIAI) www.piai.org integrates the large, small and medium manufacturers, exporters, suppliers, buyers; importers to understand the supply chain in packaging industry.

• FSSAI Food Safety & Security Association of India – packaging & labelling Regulations www.fssai.gov.in

• World Packaging Organisation www.worldpackaging.org has rich source of packaging trends worldwide and key global players in the industry

Key Vendors - India• Balmer Lawrie & Co. Ltd. • Jindal Poly Films Ltd. • Max India • Uflex Ltd.• Polyplex Corp• Time Techno• Xpro India• Rollatainers• Ess Dee• Huhtamaki PPL• Parksons Packaging• Essel Propack

Top International Companies• International Paper Company, Germany• Tetra Laval – Switzerland. Tetra Pak is hoping to support “strong growth”

in demand for aseptic processing and packaging solutions in the Indian sub-continent and South Asia through the opening of a new €120m ($156m) facility in Chakan, India.

• Reynold Group Holdings• Amcor , Australia (acquires PIPL from Essel)• Rock-Tenn, US• Polyplex Corporation Limited(among world 5 largest polyester companies)• Crown Holdings• Ball Corporation, US• Bosch Packaging, Germany (JV with Klenzaids, India)

Pharma Packaging Industry• Cogent Glass – 3 Year old company. The market for glass vials in India is growing at a double-digit

rate. Cogent is just starting production but hopes to capture a significant share of this market. Attracting global Investors – Oaktree Capital

'Pharma packaging segment will provide significant growth opportunities in the future‘� �

• Sanner Group, FRA Germany - opened office in PNQ in 2011 www.sanner-india.com• Bosch Packaging India ,STR Germany – Bangalore in 2007; sales offices in all metros; plant in Goa

www.boschindia.com• Datwyler Belgium NV – operating as Helvoet Pharma, office in Maharashtra www.daetwyler.ch• Dupont USA – multi-presence offices Indiawide• Rexam Pharma Packaging , PLC – Bangalore, Karnataka http://www.rexam.com/pharma• West Pharma , US – Hyderabad sales offices and Chennai plant http://www.westpharma.com• Delta Packaging, UK – operating as Stora Enso Inpac, Chennai in 2010 http://www.deltapack.com• MeadWestvaco Corp (MWV) merge wth Rock-Tenn ,US – cleared by CCI “WestRock” for

paperboard packaging http://www.mwv.com/en-us/about/india. • SCHOTT Pharmaceutical Systems, Germany – JV with Kaisha Manufacturers opened plant in

Gujarat• http://www.schott-kaisha.com/

Trends in Packaging Industry

Asceptic Packing

Bio-degradable Plastics

Gas Flush Packaging

Intelligent Packing

Packaging Recycling

Labelling – barcoding,RFID

Innovative Packaging

Technologies to improve business efficiencies and competitiveness…

• The globalisation of the Indian economy• Need to re-engineering the business processes to compete • Deployment of IT has been extensive focus • Automatic Identification and Data Capture technologies, which in several

companies is integrated with the ERP/ EDI applications. • The entry of MNCs and the retailing shifts - higher use of barcoding and auto

id Tech• e-governance with not only the central and state governments - driving

licenses etc., but also local administrations like municipal corporations and village panchayats to stream line administration.

• The AIDC industry incl Barcodes, smart cards, RFID, biometrics and EAS -Though the base is still small in our country, the over 40 percent growth that is taking place year on year is increasingly becoming significant.

Key Players..Automated Services

Barcoding : Symbol , PSC, Metrologic & Unitech for

bar code scanners and Zebra, Intermec,

Printronix, Sato, Toshiba & Datamax

Smart Cards : Schlumberger, Gemplus, G&D, Obethur, VCT

and Orga .Shonkh, Rolta, Smartchip, CMS, Siemens

(SISI), CA Satyam and E-Cube integrators.

STMicroelectronics, Philips, Infineon, Reneseas and

Atmel

Biometrics : Most of the biometrics hardware is being imported from USA, Germany, Israel

and in recent times from China

RFID : Worldwide, electric mix of researchers and

businessmen of Indian origin and provides an

unprecedented opportunity for the country to export services and software.