Essel Propack has set up new manufacturing capability in China with an aim to achieve 5.1% market share in China’s non-oral care tube market in fiscal year 2015-16 from current 3.2%.
The company inaugurated its fifth plant in China, with the commissioning of EPSL (Essel Propack Suzhou Ltd) in Suzhou (East China) for the non-oral care category. The plant is strategically located in the hub of all multinational and domestic cosmetic brands.
“Cosmetic products have better revenues, asset turn and value addition as compared to the other products in our portfolio. Oral care segment comprises 85% of Essel’s total revenue in China as per the last fiscal. The new plant which is our fifth site in China creates a new opportunity for Essel to mitigate any risk with current oral care customer group and could become a strong impetus for EP China’s top line growth in 2015 and beyond,” said Ashok Goel, Vice Chairman & Managing Director, Essel Propack.
The primary focus of the new plant would be beauty and cosmetic products like facial cleanser, hand cream, BB cream, shampoo and hair conditioner.
This is the first phase of investment in EPSL, which has an annual tube supply capacity of 160 million tubes, which will subsequently be more than doubled to reach 380 million annual tube supply capacity.
In addition, the company installed a new machine in Egypt with the capability to produce laminated tubes for cosmetic brands, on witnessing a fast-emerging conversion from jars to tubes in personal care products like hair gels. The major customers are changing preferences from jars and plastic tubes to laminated tubes.
Essel sees huge growth potential in the hair care markets of Middle East and Africa. To cater to this demand, the company has introduced the latest plastic barrier laminate tube with Inviseam technology, and high décor using its own Elite Printing platform.
“With two decades of experience in Egypt, this new business is certainly set to complement our growth and help us achieve our target of 50% revenue share from Non-oral care business,.” concluded Goel.