Kiri-Zhejiang Lonsen Group ink agreement.
Riding high on strong demand of dyes and dyestuff in the global markets, Lonsen-Kiri Chemical Industries Ltd, a joint venture between Chinese dye-maker Zhejiang Lonsen Group and Ahmedabad-based Kiri Dyes and Chemicals Ltd (KDCL), hopes to achieve a topline of Rs. 400 crore on standalone basis in the first year of its operations.
KDCL and Lonsen, through their joint venture, are setting up India's largest dye and dyestuff manufacturing facility, construction of which was kicked off today at Padra near Vadodara.
The greenfield unit, claimed to be the world's second largest dye manufacturing facility, is slated to be operational by April 2009. "We expect a topline of Rs. 400 crore and bottomline of Rs. 35 to Rs. 40 crore within a year once the unit gets commissioned next year," said Manish Kiri, managing director, KDCL.
Considering the robust demand of dyes in the export market, both the joint venture partners on September 2 inked an agreement to scale up the production capacity of the upcoming unit to 50,000 tonnes per annum in the first year. "Earlier, it was decided to have 20,000 tonnes per annum capacity in the first year but now it will be 50,000 tonnes per annum," he added.
"We are expecting to significantly increase our market share globally by minimum 10% with exports from India. Our facility will be 100% export oriented and the main focus will be to serve markets outside India," said Lonsen-Kiri Chemical Industries Ltd chairman Xiang Zhi Feng, who was in Gujarat to attend the foundation stone laying ceremony along with 30 senior officials of Zhejiang Lonsen Group.
"Kiri group's topline is expected to be around Rs. 800 crore by the end of fiscal 2009-10 after the commissioning of the new plant," Manish Kiri added.
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The 60:40 joint venture between Lonsen Group and KDCL is expected to pump in Rs. 400 crore for the new unit over the period of next three years. The total production capacity will be 60,000 tonnes per annum with 50,000 tonnes being added in the first year itself.
It may be mentioned here that Lonsen Group currently operates world's largest dyes and dyestuff manufacturing facility in China. The plant has 200,000 tonnes per annum capacity, while the Vadodara plant will be the second largest in the world with annual production capacity of 60,000 tonnes.