The company acquired Creative Polypack in April this year to gain a stronger hold of the food, home and personal care (HPC) industries.
Rising private consumption
Creative Polypack is expected to achieve sales of about €75m ($86.8m) in 2017/2018 and currently has 850 employees at eight production sites in Baddi, Kanpur, Kolkata, Assam and Puducherry, in northern, eastern and southern India.
Alexander Baumgartner, CEO, Constantia Flexibles, said India has become the third largest economy in the world after the US and China, with high single-digit GDP growth, major infrastructure projects in roads and ports, a simplification of the tax system and rising private consumption among the burgeoning middle-class.
As well as doubling its sales in India it plans to expand its existing subsidiary Parikh Packaging.
“India is the fastest growing flexible packaging market worldwide. Our production footprint allows us to cover the whole of the Indian subcontinent and bring the latest innovative and sustainable packaging to our customers,” he said.
He added, major FMCGs are demanding the highest level of sustainability for their packaging material and the new investment will help them to comply with upcoming Indian Plastic Waste Management (PWM) regulations that promote only fully recyclable flexible packaging.
The investment also ties in with the Indian government’s Swachh Bharat Abhiyan (SBA) campaign to clean the nation.
New production capacity
Creative Polypack intends to invest on average €6m ($6.9m) per year in new production capacity, as well as other infrastructure, at its Kolkata, Baddi, Kanpur and Puducherry sites, in the coming years.
It also plans to double its capacity at its newly-established Assam site.
Through the acquisition, Constantia Flexibles is expecting to reach €200m ($231m) sales mark in 2022, through market growth and ongoing investments.
The flexible packaging market in India is expected to grow by more than 10% in the next five years, driven by the megatrend urbanization and the expansion of the retail sector.
Before the acquisition of Creative Polypack, Constantia Flexibles was a supplier of film-based flexible packaging for the Indian market since acquiring Parikh Packaging in 2013, which is based in Ahmedabad, western India.
It has more than 500 employees and achieved sales of approximately €35m ($40.5m) in 2017, serving the food and HPC industries.
Parikh Packaging is investing a double-digit million euro amount in a greenfield site in Ahmedabad, which will be home to a polyethylene blown film extruder, high-definition Flexo printing press and laminators that will produce high barrier laminates that can be fully recycled. This will start operations in 2019.