Plastic Pipes– Business Opportunity

Indian plastic pipes industry size is estimated at around 2.5 million tonnes per annum. There are around 600 manufacturers of pipes, with the top 20 players accounting for 60 per cent of the market, and small players for the remaining 40 per cent[1].

While large manufacturers make the pipes needed for all domestic, agricultural and industrial applications (such as casing pipes, bore well column pipes, electrical & telecom ducts, agricultural pipes), smaller one’s manufacture pipes needed for last mile connectivity. These include plumbing systems, irrigation systems, electrical conduits and conduit fittings, mostly made of HDPE, LLDPE and PPR as explained in the table below.

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The Government spend on agriculture sector and irrigation schemes continues to be the main driver of pipes. For instance, Mission Bhagiratha, Telangana government’s initiative to provide piped water supply to every household in the state has given impetus to the pipe industry here. Apart from the main trunk pipelines for about a length of 5,000 km, the mission requires secondary pipelines, stretching over 50,000 km. These secondary pipelines will carry water to tanks in villages from where a village-level pipeline network extending 75,000 km will supply water to households in the state. The village level pipelines specifically require HDPE pipes[2].

Market:

In value terms, the Indian plastic pipes market stands at INR 22,000 Crores[3] and is forecast to grow at a CAGR of 10%. The market is dominated by PVC pipes that account for more than 70% (see figure 1)

Figure 1: The figure below depicts the polymer share of plastic pipes and fittings industry

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Apart from national level players such as Astral Poly Technik Limited, Supreme group of companies, Finolex industries, there are a large number of local companies, as shown in the Table 2. The local companies have strong dealer network in their region.

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Process &Technology:

Manufacturing process can broadly be divided into: mixing, extrusion, pipe sizing and down streaming. The extrusion line is customised to users’ needs, and the most important parameter is pipes’ diameter and wall thickness. 

  1. Formulation & mixing: This is required for PVC but not for any of the above-mentioned material.
  2. Extrusion: Single screw (compulsory for HDPE and LLDPE) and Twin-screw extrusion (TSE). According to the experts, if quality is imperative, one must use TSE, as it can work even without the impact modifiers and flow promoters.
  3. Pipe sizing: This can be in two ways; a) Pressure sizing, which is suitable for higher diameter pipes and b) Vacuum sizing, which is suitable for lower diameter pipes.
  4. Down streaming: This includes a number of functions such as cooling the pipes, cutting the pipes, Socketing and printing. 

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Budget:

The entry level plant (One extrusion line for manufacturing pipes for construction and irrigation industry of capacity about 100 Kg per hour) can be set up in INR 3 Crores including land, building, and working capital. Requirements for working capital would be large due to large raw material inventory and dealer credit.

Table 3 gives typical cost of machinery, which may change according to the specifications such as wall thickness and diameter of the pipes.

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How Can We Help You?

If you are interested in setting up a pipe extrusion unit, we can assist you. Our services include

  1. Market & Financial viability assessment
  2. Technical consultancy
  3. Detailed project report preparation
  4. Support in project execution 

Reach Us

Call us @ 800 888 4932

Write to us- bchhatre@finetrain.com

Visit us- www.finetrain.com

[1] Source: Finolex’s MD, Saurabh Dhanorkar interview with DNA – May, 2016

[2]Source; Livemint news article – August, 2016.

[3]Source: HDFC securities – initiative coverage –  May, 2017

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Business Opportunity: PET Sheets

PET sheets provide a convenient way of packaging product across a number of industries – consumer products, pharmaceuticals, food & beverages, etc. PET sheets are increasingly getting popular as a preferred option for packaging of food and pharma products, due to their visual appeal, their ability to keep the product safe from moisture and easy thermoform-ability.

The table below depicts various types and forms of packaging made out of PET sheets:

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Types of PET Sheets

Various PET sheets, based on their properties, are used in different applications. For example, CPET which has a very high working heat resistance (can withstand a temperature of up to 220 degree Celsius for more than 25 minutes) is used for microwaveable containers. The table below depicts the application of various types of PET Sheets.

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Market

PET sheet market is currently small, comprising just 1.5% of PET resin consumption in India. However, this market is rapidly growing and the resin consumed by PET sheet industry has nearly doubled from 6,400 tonnes/year in FY-14 to 11,150 tonnes/ year[1] in the FY 17.

Presently most of the PET sheet is manufactured by companies that make different kinds of packaging material. Two of the Hyderabad based players include Nirmala Pet A Pack Pvt Ltd and Spear Pet Pvt Ltd.

Process &Technology

Process
The process of PET sheet making broadly involves: Raw material pre-treatment, Extrusion and Drying & Winding/ Cutting the finished sheet

Fig1: Process flow

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Sometimes, the final product requires one more layer of PET or coatings, in such cases a co extruder will be required.

Single Versus Double Screw Extrusion

Screw is the most important part of any extruder. The screw is divided into three equal zones; feeding, transition, and metering. The primary functions of the three zones are:

  • Feed – taking in the resins and feeding it forward in the screw
  • Transition – compressing and melting the resin
  • Metering/ Pumping– homogenizing/ blending the melted resins and pumping out through the extruder at a constant rate.

There are mainly two types of extruders; Single screw and Twin screw.The single screw extruders typically cost less than twin screw, however they offer less operational flexibility.

Budget

The overall budget for starting a PET sheet extrusion unit with a minimum viable capacity i.e. 300 KG/hr would be Rs. 5 Crores. The machinery cost of twin screw and single screw alone would approximately be Rs. 3 Crores and Rs. 2 Crores respectively[2].

How Can We Help You?

If you are interested in setting up a PET sheet manufacturing unit, we can assist you in starting a processing unit. Our services include

  1. Market & Financial viability assessment
  2. Technical consultancy
  3. Detailed project report preparation
  4. Support in project execution

Reach Us

Call us @ 800 888 4932,

Write to us- bchhatre@finetrain.com

Visit us- www.finetrain.com

 

[1]Source: PRESENTATION OF RELIANCE INDUSTRIES LTD. – March1,2016

 

[2] Source: Based on discussion with extrusion machinery suppliers

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