Sunrise Project Report

Project Report Composite Engineering City

SUNRISE INDUSTRIES (INDIA) LTD. ISO: 9001:2008 certified

Correspondence Address : 860/3, G.I.D.C.Estate, Makarpura Road, Post Box No.843, Baroda‐390 010, Gujarat India. Tel: +91 (265) 2644958, 2645421 Fax: +91 (265) 2638742

Regd.Office & Works : Block No.30, Village :Garadhia, Jarod ‐Samlaya Road, Tal: Savli, Dist: Baroda ‐ 391 520, Gujarat, India. Tel: +91 (2667) 251342, 251276, 251653, 251350, 251626‐28 Fax: +91 (2667) 251360

E‐mail: [email protected] Website: www.sunrisepolymers.com

Project report for expansion of Plastic Engineering City

Sunrise Industries India Limited P a g e | 2

TABLE OF CONTENTS

1. Introduction……………………………………………………………………………………….…….2 2. About the project ....................................................................................................................... 3 3 About Sunrise…………………………………………………………………………..………………5

4 About the promoters ................................................................................................................. 7 5. Global Scenario of Polymers & Composites Industry ............................................................ 10 6. Indian Scenario ....................................................................................................................... 13 7. Why Composite Engineering City ………………………………………………………………….14

8. Targeted segments & products……………………………………………………………………...15

9. Why Gujarat? ……………………………………………………………………………………...…16

10. Benefit accruing out of the Projects … ……………………………………………………….....17

11. Mile stones and strength of Sunrise Industries (India) Ltd. ……………...…………………...…18

12. Cost of Project & Means of Finance ……………………………………………………………....19

13. Financials ………………………………………………………………………………………...…..20



1. Introduction Sunrise Industries (India) Ltd. was incorporated in the year 1983, 27 years of long journey is period to reckon with for its achievement and satisfaction to its customers. Today the sunrise has arisen to the need and occasion of globalization. Sunrise is trying to position its self to the development of plastics and Composites industry in the world.

Sunrise Industries (India) Ltd. has many achievements of being “First” in the country and poised to achieve the other landmark in India and world. Sunrise is planning to establish a world class Composite Engineering City with all Morden state in art of technology and with all Morden facilities and amenities of Research and Development, in the State of Gujarat near vadodara.

The vibrancy of the company can be measured by its past track record and achievements in quality of products, people and technology. It is said that when the sun rises it gives energy and light to illuminate the world. Sunrise Industries (India) Ltd. In its small attempt is trying to reach out to the millions of aspirants to show the magic of polymers and its composites. It is an attempt to synergise the strength of our company and then to distributes the wealth to the people of India and Gujarat in particular. On the completion of project it will provide employment to nearly 7,000 persons and about Rs.990 crores by way of tax revenue to the Central and State Government.

In order to make the dream a reality Sunrise Industries (India) Ltd. Is setting up a composite engineering city:

- With Morden and latest State in art of the technology

- Most unique world class R&D facilities to maintain it’s position in the world

- Have entered in to a foreign collaboration with the leading plastic engineering company in the world

- Invitation to many overseas companies to join hands, Invest in India and export products to earn precious foreign exchange for the country

Sunrise Industries (India) Ltd. In a true sense will rise in the times to come.



2. About the project

2.1 Proposed Project Sunrise Industries (India) Limited, is the flagship company belonging to Sunrise group, which is engaged in manufacturing of composite products since last 25 years. The company now proposes to expand its operations and establish a one of its kind - a comprehensive ‘Composite Engineering City’ to manufacture complete range of thermoset and thermoplastic products. As part of this expansion program the company proposes to add production capacity of 411000 MT per annum in Phase I. The proposed project will be located within the vicinity of Vadodara city. The project will cost Rs.982.57 Crores and will have the potential to generate revenues of Rs.6160 Crores per year at 100 % capacity utilisation. To undertake the expansion programme, the promoters and their associates shall bring the required equity. Necessary funding for term loan and cash credit limit shall be obtained from banks / financial institutions. Following is the snapshot of key financial indicators:

Item Particulars Details

Project Cost Cost of Project Rs.982.57 Crores

Mean of Finance Equity Capital Rs.200.00 Crores

Term Loan (repayable in 8 years) Rs.405.00 Crores

Unsecured Loan (Cash-Credit Limit) Rs.377.57 Crores

Financial Parameters IRR 14.57%

Average DSCR 2.50

2.2 Proposed products The proposed project is for capacity augmentation for production of ‘products and applications’ made of and thermoset and thermoplastic materials. These products include:

� GRP / GRE pipes fittings and tanks; � RO membrane housing and pressure vessels; � Pultruded structures; � SMC / DMC products;



� Rotor blades for wind mills; � Process equipment and piping; � Thermoset resins; � Glass fabrics; � UPVC / CPVC / PE / MDPE / HDPE Pipes and fittings; � Composites panels / sheets; � Pallets, trolleys, crates, material handling equipments; � furniture & racking system; and � Electrical components.

Apart from these products, the company shall also establish a Central Engineering Division and a Research and Development Centre, to build up in-house capabilities to manufacture tools, dies and machineries required for its production activities.



3. About Company- Sunrise Industries (India) Ltd. Sunrise Industries (India) Limited (Sunrise) was established in year 1983 (erstwhile Sunrise Industrial Equipments Pvt. Ltd.) as closely held private limited company. Since beginning of its operations around 27 years ago, the company has grown into a leading organization in South Asia for providing solutions (Design, Detailed Engineering, Manufacturing, Supply, Installation and Commissioning) for complete range of Thermoset (FRP, GRP, GRE, PHENOLIC, FURANE) and Thermoplastic (PVC, CPVC, PP, PVDF, ECTFE, FEP, PFA) lined process equipments, pollution control systems, pipes, fittings, cable trays, etc. The company is proud to be the first company in India and the only one in Asia to bag the ISO 9001 – 2000 (certification by TUV) for the complete range of Thermoset and Thermoplastic lined process equipments, pollution control systems, pipes, fittings, cable trays, etc. The company manufactures products complying to the relevant AS, ASME, ASTM, BS, DIN, IS, ISO and JIS standards. The company is following the corporate statements, which are the guiding principles behind the company’s success:

Sunrise Corporate Statements Vision Elevate Baroda – India as the world’s centre for Plastic Engineering – A centre for excellence in Thermoset & Thermoplastic products

Mission Manufacture and supply Thermoset & Thermoplastic products to the highest standard of quality along with technical support to satisfy customers’ specific requirements, thus making SUNRISE – the Team with solutions to be globally acknowledged as a leader in GRP/FRP technology.

Values Integrity, honesty and hard work are milestones that will make our vision and dream come true



Sunrise’s growth can be attributed to its professionally qualified Directors who have led the company in achieving its current leadership stature in the industry. The company currently employs a young and dynamic team of 450 competent personnel, who are committed to making Sunrise the preferred choice of customers in the market. The company has a large manufacturing facility at Village: Garadhia on the outskirts of Baroda in Gujarat, at following address: Sunrise Industries (India) Ltd. Block 30, Village Garadhia, Jarod- Samlaya Road, Taluka Savli, Dist. Vadodara – 391520, Gujarat, India

Sunrise’s factory is spread over 120,000 sq. ft. area and has open space of 800,000 sq. ft. The factory premises has ample facilities for undertaking works related to design & detailed engineering; manufacturing; steel fabrication; mould manufacturing; and installation & commissioning. For purpose of testing and quality control, the company is equipped with a state-of-art laboratory having ultra modern testing facilities.

The R&D facilities of the company is equipped with all international quality testing equipments / instruments to meet all kinds of testing requirements from raw materials to final finished products. For the proposed expansion of the “Composite Engineering City”, the company is in process of acquiring new land, in near vicinity of Vadodara city. The company has its presence in multiple countries through its group concerns, which are:

• Sunrise Composites Technologies Ltd. having offices in Sharjah-UAE and Singapore

• Sunrise Energy (India) Ltd., Chennai, India • Sunrise Infrastructure Projects (India) Ltd., Chennai, India • Novosol Composite Technologies Inc., USA • Novosol Corporation, USA



4. About the promoters Sunrise is a professionally managed company and the Directors of the Company are well-qualified and possess rich experience in the field of composites. The table below lists the current Directors on the Board of Directors of the Company.

Name Position

Mr. Joy Kunjukutty Chairman cum Managing Director

Ms. Molly Joy Director

Dr. Anil Shreedhar Kane Director

Mr. Sandesh Kumar Anand Director

Brief profiles of these Directors are provided herein below: A. Mr. Joy Kunjukutty Sunrise is promoted by Mr. Joy Kunjukutty who is Chemical Engineer and has 23 years of enriched experience and deep understanding of Thermoset and Thermoplastic materials and applications. Mr. Joy’s unrelenting focus on quality and customer support over the years, has made Sunrise a renowned name in the field of composite plastic market. He is known in the industry for his quality & unique developments in Composites. Solely to his credit, are many firsts-time-ever-in-the-world innovative composite products and applications. To name a few, the list of his firsts includes high-temperature pipes and fittings, evaporators, 100% leak-proof damper valves. Since inception of Sunrise, he has steered the company on a high growth path with an impressive list of clientele in India and abroad. His contribution has ensured the company enjoys trust and confidence of its existing clientele in providing them the products and solutions for their needs of Thermoset / Thermoplastic products. Under Mr. Joy’s able guidance, Sunrise has pioneered many outstanding achievements to its name, some of which include:

• Developing for the first time in the world : � GRP / Fluropolymer lined evaporator for spin bath application for high temperature,

pressure / vacuum conditions � Equipments, vessels, pipes, fittings for high temperature / pressure, highly corrosive

application for chloro-alkali, pulp-paper and rayon plants • Manufacturing the largest in India:

� FRP HCL storage tank � FRP chlorine dioxide storage tank � FRP spin bath storage tank � FRP scrubber for the paper-pulp plant



• Supplying the complete: � FRP equipments, tanks, pipes, fittings, ducting for the biggest pickling plant in India � FRP, PP-FRP equipment, tanks, absorbers, scrubbers, stacks, ducting, pipes for the

biggest acid regeneration plant in India Mr. Joy continues to innovate and evolve newer applications for composites products, which has helped Sunrise occupy a unique perception in market. B. Ms. Molly Joy

Ms. Molly Joy is a commerce graduate with 23 years of experience in FRP industry. She is whole-time Director at Sunrise and is actively involved in business and development of the Company. She has very good people and management skills and has proven to be a source of inspiration to the employees of Sunrise. She also looks after the corporate social responsibilities of the Company. C. Dr. Anil Shreedhar Kane

Dr. Anil Shreedhar Kane holds a Ph.D. in Mechanical Engineering with an L.L.B. in International Law and a Diploma is Industrial Administration & Management. Dr. Kane has more than 45 years of experience and serves on many Forums / Organizations as Director / Member. Some of his key involvements include:

• Member of the CORE Group, Govt. of Gujarat for Implementation of Kalpsar (Development of Gulf of Khambat) Project

• President of World Wind Energy Association for last two terms; Founder Chairman of Indian Wind Energy Association

• Research Advisory Committee Member, GSFC Science Foundation • Member, Gujarat Coastal Area Development Board

Dr. Kane holds four Indian patents and has been conferred three national awards for his scientific research. He has to his credit 51 research papers published in journals of repute in India and abroad and has spoken at more than 100 international conferences. D. Mr. Sandesh Kumar Anand

Mr. Sandesh Kumar Anand is Bachelor’s in Chemical Engineering and has attended Management programme at IIM, Ahmedabad. He has undergone a specialized course in Petrochemicals. He brings with him 40 years of outstanding work experience in Chemicals and Petrochemicals. Having worked at a senior position with large and renowned organization; namely Indian Petrochemicals Corporation Limited (IPCL), he has got extensive man-management as well as shop-floor exposure across all levels of a large and integrated business concerns. Some of his key involvements include:

• Member of various committees and institutions like ICMA, Indian Institute of Chemical Engineers, etc.



• Advisor to Government of India on Health, Safety and Environment aspects on the organization for prevention of chemical weapons convention

• Managing Director of Gujarat Chemical Port Terminal Co. Ltd. Whole-time Director – Member on Board of Reliance Industries



5. Polymers & Composites Industry – Global

This section provides an overview of the composites market globally and highlights some variant of composites products used in different applications. Composites There are over 60000 materials available for design and manufacturing of various products and applications. This wide choice of materials, poses a big challenge for the right selection of a material and a manufacturing process for developing an optimum product for a particular application. Based on major characteristics such as stiffness, tensile strength, thermal properties, etc., materials can be classified into four categories:

• Metals • Plastics • Ceramics and • Composites

Due to distinctive physical and chemical properties, composites have captured attention world-wide and have found applications in almost every sector. In fact, composites have become material of choice universally. Efforts are underway for innovative applications of composites to cater to existing as well as non-tapped industries. Therefore, composites industry has been growing impressively and increased awareness is further fuelling this growth.

Globally composites industry is estimated to be around USD 19bn in 2009. India’s fast economic growth and huge investments in infrastructure are driving the growth of the composites market. HDPE HDPE has been growing at 4.5% since 2000 and reached 30 million. tons in the year 2007. The global growth is being largely driven by the Asia-Pacific region, whose share of worldwide HDPE demand rose from 31% in 2000, to more than 35% in 2007. Many of HDPE manufacturers are setting up facilities in fast growing and cost effective countries, such as India, in Asia. HDPE grade accounted for 46% of the global polyethylene capacity in 2008 and will see more than 44% of the polyethylene capacity additions until 2015.

Milk bottles and other hollow goods manufactured through blow moulding are the most important application areas for HDPE, as over 8 million. tons, amounting to over 30% of worldwide production, finds application in this segment. Pallets Currently, wood has more than 90% share of the US pallet market, while plastics account for 2-5%. There are about 2 billion pallets in use every day and approximately 700 million are made and repaired each year. As per estimates, while wood pallets dominate, the plastic pallet market has doubled over the last 10 years. A recent study shows that plastic pallets will have highest



growth rate, advancing 2.4% annually to over 130 million pallets by 2012, though their market share will still be under 10%. It is generally believed that injection moulding and thermoforming are the dominant processing methods for plastic pallet manufacturing. Polyethylene (PE)

Polyethylene (PE), the largest group of commodity polymers generally grows in line with GDP growth. In year 2008 PE consumption was 67 million tons. The combined growth rate of the developing-regions is projected to be 4.6% pa over the five-year time period. Growth in developing regions is well above the average global projected annual growth rate of 3.2% pa. Polyethylene accounts for about 50% of the total polymer demand. According to well research sources:

• Asia has emerged as the largest market for polyethylene and the key driver of global demand

• There will be low demand growth for polyethylene in large markets like North America and Europe

• Packaging applications will account for the bulk of polyethylene demand in all the regions of the world

• Construction sector accounts for second largest chunk of polyethylene demand and Asian countries will drive the demand for this sector

• Middle East and Asian companies will dominate the global polyethylene market in the future

Global polyethylene capacity in 2008 totalled 93.87 million tons and Asia Pacific, North America and Europe are the major regions that accounted for over 76% of global polyethylene plant capacity. This capacity is expected to increase from 93.87 million tons in 2008 to 127.89 million tons in 2015, at a CAGR of 4.5%.

Asia Pacific region accounted for over 43% of the global polyethylene capacity in 2008, and is expected to account for nearly 50% of the planned capacity additions until 2015. Asia Pacific region will have the maximum capacity additions of over 12 million tons during the period 2008-2015. In this region, China and India will account for more than 8 million tons of future capacity additions. Polypropylene Global consumption of polypropylene in 2008 was 45.5 million. tons. Analysts forecast global polypropylene usage to grow at average 3.7% pa for the next five years. During this same 5-year period over 10 million tons of new polypropylene capacity is expected to come on stream. CPVC & UPVC CPVC (Chlorinated Polyvinyl Chloride Vinyl) is one of the three major thermoplastics- Polypropylene (PP), Polyethylene (PE) and PVC being manufactured and used across the globe. Globally, around 60% (~21 million metric tons) of PVC finds its way into infrastructure in the form of Water / SWR / Plumbing / Drainage Pipes, Window & Door Profiles, Pre-fab Housing, Porta Cabins, False Ceilings, Wires & Cables, Floorings, Sidings & Claddings, Decking, Fencing, Cable



Trays & Channels, etc. thereby earning the sobriquet of “Infrastructure Plastic”. Wind Mills The development of alternate energy sources has provided growth potential for the wind industry. The global wind industry is growing fast, in terms of both number of turbines and their sizes. The modern turbines are 100 times the size of those in 1980. Over the same period, rotor diameters have increased eight-fold, with turbine blades surpassing 60 m in length. By the end of 2007, around 20 GW of capacity had been installed, bringing the world total to almost 94 GW. As per a report, it is predicted that wind will supply 12% of the world’s energy needs by 2020 and could supply 30% by 2050. Wind turbine blades typically consist of reinforcement fibers, such as glass fibers or carbon fibers; a polymer such as polyester or epoxy; sandwich core materials such as PVC, PET or balsa wood; and bonded joints, PU coating and lightning conductors.

To meet challenges of the energy sector, the number and size of wind turbines has increased strongly in recent years. This development is expected to expand significantly, especially with the installation and operation of very large numbers of wind turbines in offshore wind parks.



6. Polymers & Composites Industry - India Indian plastics industry comprises of around 55,000 units. The small-scale sector accounts for 75% of units and 25% of total production. The industry consists of 2000 fibre processors, of which 80% are in the small-scale sector.

The composites industry has been witnessing significant growth over past decades. The production of composites in India is expected to be around 190,000 tons in year 2010. Indian composite industry estimated to be over Rs.5000 Crores plus industry and is expected to grow at 25 percent in next 4-5 years.

Figure 1: Growth of Indian Composite Industry The Indian composite industry has a strong manufacturing base (with automated processes) and good design and development expertise. Many global companies like Dupont, DSM, Sabic, Amiantit, Pentair, Georgia Pacific, Fibergrate, Saertex, Vestas, Beluga Tanks, Suzlon, LM and Enercon have entered in the Indian market and have established base to cater to rising local demand and exports.

With emerging sectoral growth there exist a large gap between the present composite manufacturing capacities and up-coming potential. There is a huge potential for use of composites in many industries including automobile, telecom, water treatment, infrastructure, railways, oil & gas, chemicals, transportation.



7. Why Composite Engineering City India in the last decade has witnessed double digit growth in consumption. The march for development in infrastructure, power, gas & oil industry, chemicals, Railways & ports will continue for another one decade.

World over, the use of steel is being replaced by polymer and its composites mainly on account of corrosion and weight. The polymers and composites, because of its light weight and non corrosive characters, have and edge over steel.

Sunrise Industries (India) Ltd. is engaged in providing total solutions, is planning to undertake the production of whole range of polymers and its composites. The burgeoning investment in infrastructures, oil and gas industry, power and automobiles is a driving force for the proposed “Composite Engineering City”. The manufacturing activities coupled with unique R & D facilities, technical excellence and availability of product knowledge will be a total solution under one roof.

The Unique R & D facilities and support from overseas companies will bring not only the investments but the range of products and Technology to usher into the new polymers era.

The challenges are too many, the task ahead is not easy, the growth is exponential and risk is unknown but Sunrise Industries India Ltd by its tradition will continue to provide total solution.

The next decade will see a sea change in per capita consumption of polymers and its composites. Thus it is an attempt to fill the gap and to emerge as world leader.

We can summarise benefits as under:

• Composite city can turn into a manufacturing hub and to the benefit of the society at large.

• All solutions i.e. engineering, Design, Manufacturing, Testing & guidance for use errection and installation under one roof.

• Unique R&D with world class facilities can innovate new products and give solutions for future applications.

• Polling of talent and resources can be made possible if there is dedicated city.

• Attraction to world’s large and leading manufacturers to participate.



8. Targeted Segments & Production Capacity Segments

- Oil & Gas Industry - Automobiles - Chemicals - Mining, Minerals & Metals - Power - Water / Desalination / Sewage/ Effluent Treatment - Telecom - Railways - Infrastructure - Ports & Shipbuilding

Products names and production capacity The proposed project envisages production of following products:

Name Production unit size Proposed Capacity (MT /

year)

GRP pipes fittings and tanks 25mm to 4000mm 45000

GRE pipes and fittings 25mm to 2500mm 10000

RO membrane housing and pressure vessels 50mm to 500mm 6000

Pultruded structurals All sizes 50000

SMC/DMC products All sizes 25000

Rotor blades for wind mills 5MW 35000

Process equipment and piping All sizes 10000

Thermoset resins Polyester/Epoxy/Phenolic 50000

Glass fabrics All sizes 20000

Engineering division All 5000

UPVC / CPVC Pipes and fittings 15mm to 750mm 25000

PE / MDPE / HDPE Pipes and fittings 15mm to 1000mm 25000

Composites panels/sheets 2000mm 15000

Pallets, trolleys, crates, material handling equipments

All sizes 40000

Furniture and racking system All sizes 30000

Electrical engineering components All sizes 20000

Total MT 411000



9. Why Gujarat?

1. Sunrise has the presence in Gujarat for more than 27 years and have experienced the industry friendly atmospheres in Gujarat.

2. Gujarat is one of the largest manufacturing hub in India and same is true for the plastic

industry because of the presence of largest petro chemicals manufacturing plants in Baroda and Jamnagar.

3. Availability of downstream products and raw material 4. Availability of uninterrupted and quality power in the state 5. Good availability of trained man power. Gujarat being lowest in the country for the loss of

man days because of good industrial relations and friendly atmosphere 6. Developed infrastructure in respect of Road, Rail & Port 7. Good governance of state government in helping industry and solving industries problems 8. The theme of ‘Development’ is a boosting factor for any one to be in Gujarat 9. Presence of variety of industries from oil to petro chemicals to pesticides on the one hand

and from ceramic industries to automobile to other engineering industries, apart from the above good presence of years old traditional industries like, textiles, gem and jewellery



10. Benefits Accruing Out of the Project

1. The project will provide direct employment to nearly 7000 personnels and indirect employment to nearly 10,000 personnels.

2. The project will generate sales revenue of Rs.5,600 crores which in turn will generate

revenue to the government by way of - Central Excise to the Central Government ………………….. Rs.670 crores - VAT to the State Government ………………………………….Rs.280 crores - Income Tax to Central Government ……………………………Rs.36 crores - Service Tax to Central Government ……………………………Rs.5 crores

3. The direct foreign exchange earnings is expected at …………………Rs.150 crores 4. The project will indirectly improve the leaving standard of the community in terms of

- Education - Housing - Health - Other social services like, transport, electricity etc.,

5. Many products proposed by us will be manufactured for the first time in India there for many down stream products will also be manufactured for the first time in India there by Savings in foreign exchange and society will benefit at large.









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Sunrise Project Report