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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E-WASTE RE-CYCLING – BUSINESS OPPORTUNITIES

E-waste typically includes discarded computers and components, cathode ray tubes (CRTs), printed circuit boards (PCB), mobile phones, headphones, wires & cables, and white household goods such as liquid crystal display (LCD), plasma TVs, ACs, refrigerators etc.

As per Industry body ASSOCHAM, India’s e-waste generation is likely to increase by nearly three times, from the existing 18 lakh MT per annum to 52 lakh MT per annum by 2020 at a compound annual growth rate (CAGR) of about 30%[1].

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Despite increasing number of registered recyclers/dismantlers in the country and large volume of E-waste generated, only about 5% of it is processed through formal sector. The remaining is either donated or goes to Kabadiwalas.

For example, although Hyderabad generates about 32 000 metric tonnes of E-waste annually[2] and total annual capacity of Hyderabad’s major recyclers is approximately 20,000 MT per annum (As per list of TSPCB-registered Dismantlers,) the formal sector recyclers do not get adequate waste.

The biggest e-waste recycling market in India is Delhi and approximately 30% to 40% of the e-waste in India lands there.

Process

The figure below depicts the step-by-step process for recycling e-waste.

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Current Players

The total number of registered E-waste recyclers in India is 159, whereas Hyderabad has 4[3].

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Capital Expenditure (CAPEX) for Various Options

E waste recycling chain begins with a collection centre, which can be set up for Rs. 10 lakhs. However, standalone collection centres are not encouraged to register, unless they are being set up by a recycler/refurbished or an electronic product manufacturer.  A collection centre combined with a dismantling unit can be set up for around Rs. 40 lakhs.  In India, recycling is restricted to separation of Metal and Non-metal and granulation, as the technology for extraction of precious metal is not economical.

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Regulatory Requirements

The industry is governed by e waste rules which specify the approvals and infrastructure requirements. The approvals need to be obtained from State pollution control body.

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The e waste sector has grown at a slow pace over the last five years, largely due to lack of awareness about e waste rules,  absence of strict guidelines for disposal of e waste and challenges from the informal sector recyclers who are able to offer a better price for the waste. However, the regulations around e waste are expected to tighten and would bring unorganised sector into mainstream.

Opportunities for a New Enterprise

While opportunities for e waste recycling are only expected to increase in future, profitability would depend on the value addition done by the enterprise.  Therefore, aspiring e waste companies would also need to build skill sets in e waste segregation and in identifying reusable waste. We believe that

  1. Collection centre as such will remain an un profitable proposition, as just collecting the waste does not provide enough value addition/margins
  2. Dismantling can be a profitable option if you are able to establish a network of waste collection centres (perhaps from the unorganised sector) and develop skill sets to identify reusable waste
  3. Setting up a refurbishing centre, where salvaged computers/phones can be repaired using new or old components should also be attractive.
  4. Recyclers would need a large network of collection centres or need to import waste to ensure capacity utilisation.

How we can help you?

We can help you set up E waste recycling unit through a number of services including

  • Market viability assessment
  • Technical consultation and
  • Project execution support.

Reach Us

Write to us: bchhatre@finetrain.comadmin@finetrain.com

Call us: 800 888 4932 /9032398367

Visit us: www.finetrain.com

 

[1]Source: The Hindu – article dated at June, 2016

[2] Source: ASSOCHAM-Frost & Sullivan study, April, 2016

[3]Source: List of Registered E-Waste Dismantlers/Recyclers in the country (as on 29-12-2016)

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Business opportunity: PET recycling

Ever thought about what happens to the cold drink/juice/mineral water bottle after we have discarded it. About 70 per cent of PET bottles are recycled and reused in textile and packaging industry.

India is one of the largest recyclers of PET in the world, next only to China. The industry is growing at a rate of more than 25 per cent per annum. India consumes around 800,000 tonnes of PET resins annually, around 70 per cent of which is collected and recycled. PET recycling business has a turnover of Rs 3,500 crore[1].

PET recycling business is concentrated in Maharashtra and Gujarat, textile and packaging hubs of the country. There are not many PET recycling units in Andhra Pradesh and Telangana. Given that both Telangana and Andhra Pradesh are bountiful in cotton and have identified textile as a focus sector, PET recycling can be an attractive opportunity.

PET Recycling Process

PET bottles are collected by rag pickers and eventually find their way in the recycling factories. Here the bottles are crushed to make PET flakes that are cleaned, cleared of other polymers, hot washed and dried. These flakes can be further processed into fibres (for textile) or injection moulded/ blow moulded for other applications.  The quality of PET is measured in terms of its purity (PPM, particle per million of impurities) and its hardness (Intrinsic viscosity, IV).  The quality of PET flakes is dependent on the input as well efficiency of the washing process.

Market

In India recycled PET (R PET) is not allowed for packaging of food items. The key end use applications of RPET include textiles, PET straps and home furnishing. Nearly 70-80 per cent of R pet is consumed in textile industry.

Products can be made from PET Flakes

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The industry players are of two types, PET flakes manufacturers and integrated players who process the flakes into fibre or other products. The table below describes some of the integrated players.

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Budget

A PET flakes manufacturing unit (comprising PET grinder and washing line) of a capacity of 300 kg per hour can be set up within a budget of Rs. 1 crore.  The land requirement would be around 1000 sft. One also needs to develop a strong network of/chain to collect PET waste.

How can we help?

We can help you set up PET recycling unit through a number of services including market viability assessment, technical consultation and project execution support.

Reach Us

Write to us: bchhatre@finetrain.comadmin@finetrain.com

Call us: 800 888 4932 /9032398367

Visit us: www.finetrain.com

[1] Source: http://www.petrecycling.in/ and Reliance industries presentation in

ASSOCHAM’s 4th National Conference on ‘Waste to Wealth

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Business opportunity: Medical Devices sector

Medical devices refer to devices and consumables used by the doctors and hospitals in patient care. It is a multi-product industry comprising consumables, surgical instruments, implants and diagnostic reagents. The industry size is estimated to be INR. 30,000 crores, with imports accounting for 70 per cent of the industry turnover. The industry is growing in double digits.

The sector offers huge opportunity for entrepreneurs to offer cost competitive products that can reduce our dependence on imports and make healthcare more affordable and accessible to all.

What are the key segments?

The market can be divided into four categories, as shown below

Picture 1: Indian Medical device Industry

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Source: Recommendation of task force on Medical Device sector in India-2015

Who are the large manufacturers?

The Indian market is dominated by international players such as Abbott Vascular, GE health care, Phillips health Care, Medtronic, Johnson and Johnson, Siemens, Baxter, Stryker, Zimmer holdings and many more.

Among the Indian manufacturers, there are around 800 companies, majority of them are present in price competitive consumable segment.  Some of the interesting Indian players who have been able to offer technology based differentiated products are as under. (See table 1)

Table 1: Medical devices manufacturers-interesting companies

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Where is the opportunity?

The equipment and surgical segment and implants offer attractive opportunity for manufacturing indigenous products that can reduce our import dependence. These segments have been described in the table below.

Table 2: Attractive segments- Medical device industry

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The opportunity can be broadly be divided into two categories:

  1. Manufacturing Products similar to already existing imported products: For example: surgical sutures, dialysis machines, ECG machines, patient monitoring systems etc. Indian companies can offer more cost effective diagnostic equipment or an implant
  1. Opportunities to create new products that are not available in the market before For example- Cost effective diagnostic solutions for poor and rural population. Some of the companies that work in this area include Forus health care (Eye screening devices) and Biosense Technologies (cost effective solutions for checking blood sugar, anaemia etc).

What are the challenges?

As per Dr. Ashutosh Mundkur, a senior medical device industry professional and start up mentor, a medical device start-up faces following challenges:

Inadequate market research: The market assessment about the need for the device and its ability to either cut the healthcare cost or improve user experience has to be clearly established. Many companies discover their inability to sell the product after they have launched the product in the market

Lack of adequate attention to quality and safety aspects of the device: Many a time’s start-ups are too focussed on reducing the cost of the device to make it competitive Vis a Vis imported products and do not pay enough attention to the quality aspects.

Regulatory hurdles: There is lack of clarity on license required for manufacturing medical devices. As per the current regulations, the CDSCO license (Central Drug Standards Control Organisation) is needed for 14 notified devices[1].  For the remaining, it is left to the state Drug controller office/CDSCO to decide whether a license is needed. However regulatory hurdles are expected to clear after passage of new medical device regulation, which is currently under review and awaits parliamentary approval

Funding: Investor interest in early stage medical device start-ups remains low, due to uncertainty about the device’s potential to make it big and long development time. Some of the funds[2] that have invested in health care start-ups include Avishkar, Acumen, Centre for innovation and entrepreneurship (CIE, IIMA), Unitus, Venture East and Viligro

Conclusion 

With the rising disposable incomes and increasing longevity, the demand for better health care is only going to rise. Medical devices are instrumental in making health care more affordable and accessible.  The ecosystem for the medical device companies is expected to improve with government’s effort to promote manufacturing in India.  As such, growing demand and improving regulatory outlook, make medical device manufacturing a very attractive segment.

How can we help you?

We can help you start a medical device manufacturing business through a number of services including business viability assessment, market landscaping and expert consultation.

Reach us:

bchhatre@finetrain.com

Phone:800 888 4932

[1] As per drugs and cosmetic act fourteen devices are notified as drugs. In addition, eight products including Blood Grouping Sera, Ligatures, Sutures and Staplers, Intra Uterine Devices (Cu-T), Condoms, tubal Rings, Surgical Dressings, Umbilicalfapcs, Blood Component Bags also require drug license.

[2] Source: https://yourstory.com/2013/09/ventures-investing-in-indian-healthcare-sector/

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Business opportunities in Telangana

The State of Telangana is the 12th largest economy with a GSDP of around Rs. 4.68 lakh crores[1] and a growth rate of 9.2% during 2015-16. Telangana includes 10 districts, with its capital in Hyderabad. Telangana is land locked with its neighbouring States of AP, Maharashtra and Madhya Pradesh.

Telangana is home to large industries in IT/ITES, pharma, engineering goods and defence. The industrial activity is currently concentrated in Hyderabad, Ranga Reddy and Medak Districts, these three districts contribute to almost 50 per cent of the State GDP. Medak and Ranga Reddy are also the fastest growing districts.

The opportunities in Telangana can be broadly divided into a few sectors; agro based industries, textiles, chemicals, engineering, and pharmaceuticals. The district wise opportunities are described below.

Business profile of districts of Telangana

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Upcoming opportunities

Small enterprises can become a part of the vendor network /ancillary to the large industries that are planned in and around Telangana. The figure below describes the projects across various industries that are currently being planned. These include a number of bulk drugs intermediate and API (Active Pharmaceutical Ingredient) units,   food park by ITC, an LED bulb unit by Syska labs, Soft drink bottling plant by Hindustan Coca-Cola Beverages Pvt Ltd, and Mobile handset manufacturing facility by Micromax informatics Ltd.   A detailed list of upcoming projects is available upon request.

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Source : Projects Today

How can we help

  • FineTrain enables entrepreneurs to assess and understand new business opportunities. Our services include market research, business feasibility studies and business diagnostics.
  • We can help you assess your market, identify technology and raw material providers, estimate the capital requirements, time to breakeven and recommend ways to expand your business.

Reach us:

Call us @ 800 888 4932,

Write to us- bchhatre@finetrain.com

[1] Source: GSDP at constant prices, Socio Economic Outlook, Telagana, 2016

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