Amritsar-based Khanna Paper Mills (KPM), one of the top ten paper manufacturers in India, is on an expansion spree. It plans to set up a unit in Gujarat with an installed capacity of 1,000 tonnes per day at a project cost of Rs 1,000 crore, likely to be funded through an IPO and internal accruals.
Currently, with installed capacity of 1,200 tonnes per day, Khanna Paper Mills Ltd, which manufactures duplex board, newsprint and writing and printing paper, is the largest single location plant in India using recyclable paper waste in the country. The company has a market share of 11 per cent in copier segment, 20 per cent in writing and printing paper, 48 per cent in packaging and board and 30 per cent share in newsprint.
Further, with a vision to become market leader and also buoyed by the response from the domestic and International market, the company has plans to set up a new unit in Gujarat having installed capacity of 1,000 tonnes per day with an investment of Rs 1,000 crore. Besides, the company has also plans to hit the capital market. The proceeds from the issue, internal accruals, term loan would be utilised in funding the expansion plans.
Earlier, speaking to Business Standard, Khanna Paper Mills CMD B M Khanna said, “In order to meet the growing demand of paper in the domestic and international markets, we have plans to set up a unit in Gujarat, with an installed capacity of 1,000 tonnes per day by 2013. As we import waste paper from overseas, this is an ideal location for setting up the new unit, as it will save expenditure incurred on logistics front. The new plant is likely to attract an investment of Rs 1,000 crore to be funded through internal accruals, debt and proceeds from the IPO that is in the offing. We are likely to hit the capital market by 2013.”