Sintex Analysis

Topics: Plastics industry, Business model, Plastic Pages: 9 (2625 words) Published: February 10, 2013
Name:Girish Jitendra Malekar|
Batch:A| Roll No.A-11015|
Marks Allocation: | |
Assignment No:| |
Assignment Scope: Individual| Assignment Duration |

Back ground to the study
Plastic has derived demand. It is indispensable for every aspect of contemporary life. India has not capitalised on Plastic. Our per capita consumption is amongst the lowest in the world. The industry faces few key impediments that have restrained its growth.


* Strong base in polymer * Low cost labour * High percentage of recycled plastic| * Low scale production * High cost of plastic for end-use application * Obsolete machinery * Poor industry image * Industry not focussed on exports| | |

* Rising crude oil prices * Threat of polymer import from middle east * Strong processing industries in neighbouring countries * Environmental concern with plastic packaging leading to substitution| * Opportunity on account of plasticulture which is at a nascent stage in India * Opportunity to tap higher value processed plastic exports where India has no presence * Potential demand by growth of sun-rise industries such as Retail| THREATS| OPPORTUNITIES|

To succeed, the industry needs to gain control over
* Promote use of plastic in untapped areas domestically * Proactively focus on exports as abusiness strategy rather than the current mindset of focusing only on domestic market

* Scale/ Technology
* Increase scale of operations
* Adobt new technology to be in sync with global trends

* Cost
* Reduce the burden of plastic cost on end use industry Domestic demand has been growing at 9% has reached 4.47 mmt

With GDP in the same period growing 6.63%, the plastic industry has grown at 1.5 times GDP.

India’s per capita consumption is however just one fifth of the world average

So there is lot of potential for growth as the market is uptapped.

Plastic underutilized in critical sectors in India

India holds immense potential of use of plastic in Agriculture and Infrastructure

Can plastic replace conventional material for piping system?

PVC pipes offer a projected life span of>100 years without any loss in strength.

PVC pipes are lighter and therefore easier and cheaper to install.

Government needs to promote use of plastic pipes

Power and telecom sector require substantial investment

Power:the Indian power sector will require an investment of RS.2.5 lakh crores in the transmission and distribution sector by 2012.

This entitles an investment of Rs.60,000 crores in power cables.

TELECOM:A 23% increase in the telecom subscriber base will drive demand for telecom cables.

This will require 1.39 crore kilometre of optical fiber cables to be laid

The Indian polymer sector provides a strong backbone for plastic industry in India * India has a strong base in polymer manufacturing with the presence of large organised players * With polymer rise, the industry is gearing up to meet plastic demand * Tthere exists an inverted imort duty structure between crude oil and naphtha * Feedstock prices haven risen significantly which has resulted in polymer prices increasing consistently. * Polymer imports based on capacities coming coming up in the middle east would pose a threat to Indian polymer companies

Share in global processed plastic export
India is practically non-existent in the world processes plastic trade markets

The plastic processing sector is the weak link in the plastic chain * The processing sector needs to consolidate to reap economies of scales and become competitive. * Processing facilities should be modernised to enable manufacturing of higher value added products. * There must be concerted effort to improve labour productivity. * The industry should think big to look at...
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