Tag Archives: packaged foods

UFLEX Ltd Q3 FY 2013 Net Revenue Up 15% at Rs. 1295 crores

New Delhi:- Uflex Ltd, the Bombay Stock Exchange (UFLEX: 500148) and NSE listed, India’s largest flexible packaging company, has registered a growth of 15% in its consolidated revenue for the quarter ended December 31, 2012 at Rs. 1295 crore as against Rs. 1129  crore for the same period last year. Its consolidated net profit for the Dec. quarter of FY 2013 stood lower at Rs. 36 crore, against Rs. 51 crore for the same period last year.

For the nine months period ended December 31, 2012, UFlex recorded lower net profit of Rs. 149 crore against Rs. 205 crore in the corresponding period last year, while net revenue of the company for the nine months ended Dec.. 31, 2012 stood higher by 19% at Rs. 3940 crore compared Rs. 3320 crore in the same period in previous fiscal.

The higher revenue growth is attributed to new capacity expansion globally and increased uptake of innovative flexible packaging solutions offered by the company across sectors. Uflex completed the expansion in Poland successfully during July, 2012 and in Kentucky, USA during January 2013. Collectively the two facilities involved investments of about $ 150 million.

According to Mr. Ashok Chaturvedi, Chairman and M.D. of UFLEX Ltd, “The market conditions for the plastic film have been unfavourable during the current financial year, causing having downward pressure on prices & margins thereof.  However, conditions have started showing some improvement from February, 2013 and there are hopes that it will show up better in the coming time.  We are quite confident that FY 2013-14 would witness far better results.

Our three pronged strategy of growth with Innovation, proximity to customers with focus on operational excellence and better quality & quick service and deliveries to customers is the key to our success story that also reflects in the company’s top line growth. We will continue with our endeavors to become one of the largest packaging companies in the globe delivering value to our customers with best-in-class products and services; and incremental return on investments to investors.”

Uflex’s strong manufacturing base in India, Mexico, Dubai, Egypt, Poland and USA caters to global markets spanning USA, Canada, South America, UK, Europe, Russia, CIS countries, South Africa and other African countries, the Middle East and the South Asian Countries.

Expansion Plans

UFLEX’s agenda of global expansion and consolidation of its position as a truly Indian MNC (Multinational Corporation) is reinforced with its strategy of capacity expansion and adding manufacturing lines for various product categories across existing and newer locations to increase proximity to the markets, but also to bring broad portfolio of value added products to its clients at competitive price points.

The company offers its flexible packaging products and solutions globally to clients including Unilever, Pepsi, Wrigley, Procter & Gamble, Colgate, Palmolive, Nestle, Gillette, Ranbaxy, Perfetti, Joyco, Monsanto, ITC, Godrej Pillsbury, Tata Tea, Hindustan Petroleum, Indian Oil, Britannia, Dabur, Haldiram, Wockhardt, HUL, Parle Biscuit, Birla 3M, among others.

Future of Packaged Food Industry in India: Drivers and Barriers

Indian packaged food industry in the past couple of years has seen an exponential growth of demands both within the country and outside.  It is expected that the surging demand will further exceed the present growth expectation in the near future.  Bain & Company India, the national unit of the global business consulting firm and FICCI discusses the various driving factors and the possible challenges faced by the food packaging industry in a recent report titled ‘Processed Food in India: Enablers and Barriers’ It further focuses on how the Indian economy is changing at a fast rate in terms of its lifestyle, and is based on a number of primary and secondary researches conducted in various sections Indian society.

The key factors that will shape the growth in India’s packaged food industry are:

  • Agricultural strength laying the foundation for expansion
  • Demographic shifts resulting in surging domestic demand
  • Market-player interventions
  • Favorable government policy

Indian packaged food market and packaging industry is thriving and has witnessed strong annual growth for several years now. For instance, confectionery, dairy, baked goods, sauces and household staples such as packaged rice, was worth approximately Rs 1 lakh crore at the end of 2011. With rising incomes, changing lifestyle and favorable demographics, the Packaged Food Industry has shown a remarkable growth of over 13 per cent per annum over the last few years. This annual growth is not only considered a big opportunity for the companies serving agricultural and several ancillary sectors but also a new gateway for employment, economic growth and quality of life in India.

With the changing lifestyle, there has been a consistent increase in preference and demand for packaged foods amongst the Indian population. These can be seen as a great opportunity by the packaging companies of India. The agricultural strength amalgamated with a various other factors like competent market price and favorable government policies have further aggrandized the Indian food packaging sector.   It is worth mentioning that leading flexible packaging companies like Uflex Ltd. have contributed greatly in both domestic and international food packaging market with its innovative and world class flexible packaging solutions, a variety of value added flexible packaging material, sophisticated products including films like BOPET, BOPP and CPP.

Despite India being a favorable destination for the packaging industry, there are a number of barriers that can hinder the anticipated growth.  Lack of proper infrastructure, difficulties in conducting business and profitability challenges are considered by the Bain & Company and FICCI report as the three major barriers that can hinder the growth of packaged food industry.

In order to succeed and utilize the tantalizing opportunity in the packaging sector, a proper planning while considering the existence of multiple stakeholders is crucial. Indian packaging industry has to recognize the biggest enablers that will drive success and identify the barriers likely to hinder it thereby developing and executing action plans that will optimize the first while mitigating the second.