Lohia Starlinger aims at Rs 500 cr turnover

Firm to start machine upgrade, capacity expansion

Kanpur-based Lohia Starlinger Ltd is targeting a turnover of Rs 500 crore in the next three to four years, and to achieve that it has started upgrading its machines and undertaking an expansion of capacity.

This target has been set against the previous financial year's sales of about Rs 230 crore and about Rs 201 crore in 2004-05.

The company, which started with a technical collaboration with Starlinger of Austria, attained technological self-sufficiency and since then has become its principal competitor in the world in the manufacture of machines for the woven plastic sack industry. The technical collaboration with Starlinger ended ten years ago, although the latter still retains its 35 per cent stake in the company.

Another important feature is the business strategy. Managing Director Raj Kumar Lohia told Business Standard though the business strategy should never be revealed, it is about concentrating on quality.

Lohia is confident of achieving the target of Rs 500 crore sales because the packaging industry is bound to expand with the increase in GDP and increase in agricultural output. Lohia said: "Our machine specs are comparable to those produced anywhere in the world. Though Starlinger is ahead of us in turnover, we are growing at a higher rate than our Austrian competitor. We are ahead of them as far as power consumption is concerned."

When asked about the size of the world market, Lohia said internationally the industry was not organised, and therefore no definite figures could be given. But the general information and trend in the market show that.

Though the basic designs of the machines are Starlinger's, the Lohia group has been improving and innovating on them continuously. A recent example is that of a machine called Tape Extrusion line to make yarn for fabrics, which was displayed at Plast India, with a 950 kg per hour capacity. The last best was of 350-400 kg per hour, says Manoj Agarwal of Kanpur Plastipack, a city-based woven plastic sack making company.

The company has managed to increase its exports significantly to 50 countries in the world, spread over all continents. Due to a boom in the Indian market, exports of Rs 90 crore were a little less than of 2004-05, when it had reached Rs 98.09 crore, "as we had to service our home clients first".

This line itself is pretty large and 'we are not thinking of diversifying .' But Inspite of this declaration of intent, the company, however, has embarked upon manufacture of automobile components .But Lohia will not discuss the figures involved or the targets which he may have set for the company.

The Lohias are now well established as a rising industry group, mainly due to their perseverance as quality machine makers.