Polyplastics to set up Rs 25 cr unit

Viewing the rapid growth in the domestic vehicle market, Yamunanagar-based Polyplastics, manufacturers of precision plastic engineering components for automobiles like speedometer gears, connector terminals, grills, wheel covers, and oil separators is setting up a unit in Pune at Rs 22-25 crore, in phases. The plant is likely to be operational by March next year.

The new plant will come up in an area of over 2.5 acres and will cater to the demand of the automobile industry. This will be the company's third plant; the company has manufacturing facilities in Gurgaon and Yamunanagar.

Speaking to Business Standard, Polyplastics Director Kapil Gupta said: "The total project cost will be Rs 22-25 crore, but in the initial phase, we will put in Rs 8-10 crore. The unit will be operational by March next year."

Commenting on the location, Gupta said: "The automobile industry is concentrated mainly near Delhi, Pune and Chennai. We have plants in Gurgaon and Yamunanagar to cater to the Delhi hub, and the upcoming unit to the Pune zone. The plant should be close to the manufacturing facilities in order to reduce inventories and cut transportation time. So we decided to put up our new unit there."

"We also have plans to set up a unit near Chennai, but the planning is in an early stage," he added

At present, the company is supplying high-precision plastic engineering components to leading car manufacturers like Maruti, Tata Motors, Toyota, General Motors, and Honda. Also, it is exporting these parts to the General Motors plant at Thailand and Daewoo's Romania plant.

Commenting on the demand for automobile parts, he said; "India contributes only 3 per cent of the world's cars, whereas Japan, the US, and Europe account for a major part of the production. As the cost of production in these countries is high and rising, it is certain that in coming years, production will shift to low-cost countries like India, Malaysia, Brazil and China, in 4-5 years. But we have to update ourselves on technology."

In the last financial year, the turnover of the company was Rs 33 crore, and this year the company is hopeful of touching Rs 40 crore. With the new plant and the new product in the offing, the company is targeting Rs 100 crore as turnover by 2010.

Exports contribute 2-3 per cent of the total turnover, expected to go up.