R. K. Jain, Group President (Corp. F&A), Uflex Limited

Packaging is an evergreen industry as any and every branded product that is marketed is cased in a pack. The package hosts the identity of the product and the brand at large. Aesthetics of packaging play a defining role at the point-of-sale (POS).

Jan 09, 2017 08:01 IST India Infoline News Service

RK Jain
Mr. R. K. Jain is Group President (Corp. F&A) at Uflex Limited and Director of several Group companies. He brings with him wealth of experience of more than three decades in corporate planning & strategy formulation and corporate finance including management of corporate communications; investor relations; corporate social responsibility; IT systems and corporate governance.

Uflex Limited is India’s largest multinational flexible packaging materials and solution company with its products enjoying a formidable market presence in over 140 countries. Uflex today has state-of-the-art packaging facilities at multiple locations in India with installed capacity of around 100,000 TPA and has packaging film manufacturing facilities in India, UAE, Mexico Egypt, Poland and USA with cumulative installed capacity in excess of 337,000 TPA.

Integrated within its core business profile are allied businesses like Engineering, Cylinders, Holography and Chemicals that further give Uflex a superior edge above competition and qualifying it to be fully integrated end to end flexible packaging materials and solution company.

IIFL spoke to Mr. R. K. Jain, Group President (Corp. F&A) at Uflex Limited and following are some of the excerpts of the conversation.

How do you see the packaging industry growing in the coming year? 
Packaging is an evergreen industry as any and every branded product that is marketed is cased in a pack. The package hosts the identity of the product and the brand at large. Aesthetics of packaging play a defining role at the point-of-sale (POS). Barrier properties of packaging help in extending the shelf life of the product packed inside whereas the functionality of the pack is and should be seen as an overall extension of the consumer experience. Brand protection and anti-counterfeiting features of packaging ensure that the product reaching the consumers exactly conforms to the parameters set by the marketer towards quality and quantity.

The major trends that will define the contours of the packaging industry in FY 2017-18 are Sustainability; Innovative & efficient shapes and structures conforming to brand image; Invigorated online sales; Functionality of packaging will command price and respect; Product to package ratio will be further pushed up by packaging engineers; Smart and active packaging will call the shots.

We foresee the Indian packaging industry to grow anywhere between 15 - 17% in FY 2017-18. Globally the growth of the industry will be around 5 - 5.5%.

How has demonetisation affected your company sales?
It is all too early to assess the impact of demonetisation on the sales of our company. You will appreciate that there is always a pipeline of orders in any business. This is based on meticulous forecasting by the purchasers. In any industry for that matter, the actual effect will pan out once the order book from before the demonetisation exhausts. The impact of demonetisation on our business will be cushioned as we have a well-rounded exposure for packaging of goods that exhibit both elastic and inelastic demand. Additionally our products enjoy a formidable market presence in over 140 countries and are not just restricted to India which in turn will also contain any sharp aberration. Our projects are progressing well as planned. So far so good!

What are your expectations on GST and how will it be beneficial to the packaging industry overall? 
GST at the first instance is a great move towards the simplification of the trade tax structure in the country. We are sure it will definitely reduce the element of unorganized players from the market who used to evade taxes and duties deterring market dynamics. With the introduction of GST, healthier market conditions will prevail and raise the quality of operating standards of the packaging industry.

What are the key challenges facing Uflex to grow at faster rate while maintaining steady margins? 
I would not call it a challenge, but for a large base fully integrated multinational flexible packaging materials and solutions Company like Uflex the real margins are derived from value added packaging products like pouches; laminates; flexi-tubes; big bags; converting and packaging machines; brand protections solutions like holograms, Fresnel lens, holographic wads among several others. Our sales team is exploring newer territories and industry sectors to offer innovative packaging solutions which is already and shall continue to boost growth.

Can we expect any new product launches from Uflex in coming quarters? 
As you would be aware, our aseptic packaging plant for packing liquid products will be commercially operational by April 2017. This will complete our entire product bouquet which currently spans across flexible packaging solutions for solids, semi-solids, granular material, powder, gels, viscous fluids etc. This is the real game changer for Uflex that will take us to the NEXT LEVEL. The new product will be a six layered Packaging and Design solution for the Beverage, Dairy and Distillery Industry, built on the 3 P’s of Packaging i.e. PRESERVE - PROTECT AND PROMOTE keeping in mind the perspectives of customers & end users. The packaging solution thus engineered will be highly effective and optimised with best material application comprising Paperboard, Aluminium and Poly Ethylene offering an absolutely sterile packaging environment.

Another important offering from Uflex in time to come, will be aimed at the pharmaceutical industry. The conventional product [laminate] that is being made as of now by various players has biaxial oriented nylon on one side and Polyvinyl Chloride (PVC) fills on the other for packaging tablets and capsules in India. The raw materials have to be imported. We want to offer the world something that is made and developed in India. We have brought in the latest equipment and learnt the technology and are offering a viable alternative with isotropic polyester film on both sides. The product is currently under trial with various pharmaceutical companies and will be launched in a big way both in India and overseas.

Like I explained earlier, Innovation to create value added differentiation is the core pillar of our global business strategy. There are many products that are under development which you will get to know in the coming quarters as and when launched.

What is your projection on revenue growth for coming two to three years?
With all our projects running on time, we expect to double up our revenue to $ 2 Billion in the next 3-4 years.

On the margins front , are you confident of growing your revenues while keeping margins in tact?
Due to many initiatives taken by Uflex in terms of new product innovations, process and production improvements and the overall broad basing of product offerings, not only will we increase revenue but would also improve margins in future.

What is the growth in EPS targeted by the management for coming year? 
We are targeting a growth of minimum 25% - 30% per annum in the consolidated net profit of the company at least for the next 5 years.

Can you help us understand the products launched by Uflex in order to protect brands and how has the response in the markets for such products been?
According to a recent research report by a leading brand management consultancy, counterfeiting now costs more than 2% of the global economic output that works out to around $1.8 trillion a year. The dark underbelly of counterfeiting is expanding by over 15% every year, which is alarming. Consumer goods account for over 46% of the counterfeiting trade.

We are a pioneer company in waging a global war against counterfeiting and are helping brands protect their identity and reputation by thwarting any and every nefarious attempt by counterfeiters through our solutions.

Some of our wide gamut of brand protection and anti-counterfeiting solutions include different types of Holograms {analog 2D/3D conventional, Dot matrix (up to 24,000 DPI); non-diffractive Litho (up to 1,20,000 DPI) and E-Beam}; Wide Web Holographic Films {Soft embossing films, Hard embossing films, UV embossing films, High Refractive Index films, Windows/ De-metallized and Lens films}.

Other products are Holographic Pouches, Holographic Strips, Holographic Scratch, Holographic Wads, Holographic Shrink Sleeves; Labelling solutions using foils, Fresnel lens and holographic effects {Printed Labels, Tamper Evident Security Labels, Anti-counterfeit Labels, Bar-Code Labels, Scratch Labels, Thermal Transfer Labels, Serial Number Labels, Holographic Labels}; Hot and Cold Stamping Foils and OEKOTEX Certified Textile Value Addition Products {Sequins Film, Hot Melt Film, Holographic Glitter Film} etc.

The aforesaid solutions jointly or severally are in huge demand by our clients globally and add value to the entire packaging proposition.

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