Time Technoplast, expects a growth over 15 percent this fiscal, says Anil Jain, Managing Director of the company. Speaking to CNBC-TV18, Jain says he expects this growth through the company’s overseas operations which contribute to 32 percent of its turnover.
He says demand from Indonesia, Vietnam, Thailand, Egypt and Saudi Arabia has been strong, as the concept of replacing metal packaging with polymers is catching on.
Growth in India and China is muted which is why the company exited a joint venture (JV) with its Chinese partner and utilised the proceeds for a JV in Egypt, he adds.
Below is the edited transcript of Anil Jain’s interview with Sonia Shenoy and Latha Venkatesh on CNBC-TV18.
Sonia: First, if you can just tell us what the terrain is looking like for the company itself. In the quarter gone by, you did not mange to do a double digit top-line growth. It was about 8-9 odd percent. Is the industry seeing a bit of a slow down and in the first half of this fiscal, what kind of growth do you foresee?
A: If you look, we have grown about 13 percent last year. And that continues even in this quarter actually. We have predicted that our growth in the current year will be about 15 percent or more than that. This is the blended growth that we are talking about. Admittedly, the growth in India is a little muted, which is about 9-10 percent. But, we have got overseas ventures which are doing very well for us and we are seeing growth of about 20 percent.
So, the blended growth will still be about 15 percent. Our overseas operations now are sizeable; they contribute about 32 percent of our total turnover. So, we are pretty sure that this year we will grow at a minimum of 15 percent. Of course the internal target is 20.
Latha: The big news that hit the papers itself is that you have exited your joint venture with your Chinese partner. So does that bring some money?
A: It brings me money, but then I have bought a partner in Egypt actually. So, there was also a joint venture, 50-50. So, I have exited from China, but I have taken Egypt almost in about the same amount of money. But, the reason was very simple. For a company like us, we need to be in the growth market. In China we have seen that the growth has muted. If you really are in China then you realise that things are actually slowing down, whereas in Egypt, we were seeing that the demand was very strong. So, we thought that it will be a good idea to leave China just in time and go and buy 100 percent in our joint venture in Egypt. So, that is exactly what we did.
Latha: Where is the demand growing internationally? The other economy, like you said China is slowing.
A: We see a very good demand growth in Indonesia, Vietnam and Thailand. Egypt is also growing; we cannot complain about Saudi Arabia either. We have presence there and Middle-east is quite okay. So, we have seen growth and besides, if you really see our business profile, we are replacing metal packaging with polymers. So, even if those countries really do not have a growth, we actually can keep replacing metal with plastic.
Now, in India 55 percent of industrial packaging, converting metal to plastic, has already hapened. Overseas it is still six to eight percent. So, if we keep doing the same thing [there] which we did in India, I am sure, in coming years we do not have to worry about whether those countries are growing or not growing.
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