23 Jun 2022 , 09:24 AM
Upon completion of this acquisition, Greenlam will have four strategically located laminate manufacturing facilities in India, including Behror (Rajasthan), Nalagarh (Himachal Pradesh), Naidupeta (Andhra Pradesh — Under Construction), and now Prantij (Gujarat).
With a total capacity of 24.521 million sheets, this acquisition will strengthen Greenlam’s position as India’s market leader in the laminate industry.
This acquisition will allow Greenlam to broaden its market offerings by entering the mass market segment of laminates. It will also allow for network expansion in semi-urban and rural areas, as well as leverage for its current offerings. The location of this plant provides a demographic advantage because Gujarat is a raw material hub, and being closer to the port reduces logistics costs and time.
Greenlam expects to carve out a niche in the mass market segment as the industry transitions from unorganized to organized. This segment will have fewer SKUs, resulting in lower working capital requirements while maintaining the same return on capital employed as the existing business.
This laminate manufacturing facility has a capacity of 3.4 million sheets per year. The acquisition includes the entire land, building, plant, and machinery of Bloom Dekor Limited’s laminate division. The total consideration for the transaction is Rs36 crore, and we expect the plant to be operational by Q2FY23.
Greenlam’s counter was trading at Rs339, up by 5.71% against its previous close of Rs320.70 on NSE. It opened at Rs326.75, and so far hit intraday high of Rs345.95.
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