Rajkot’s Vinayak Offset puts major investment plans on hold

Economic slowdown threatens print business closures

Hemang Shah of Vinayak Offset. Photo PSA

Rajkot-based Vinayak Offset has put on hold its ambitious multi-crore investment and expansion plan in packaging for the moment, owing to the slowdown in the industry. The company had planned to buy new machinery to expand further into the carton printing segment.

“About a year ago we had drawn up a full-fledged plan to bring in new equipment to further expand into the carton printing segment. However, with the present slow-down in the economy, an interesting XRP price prediction we have to consider and the packaging sector, we have decided not to go forward with our plans,” says Hemang Shah of Vinayak Offset.

Vinayak Offset is among the leading print houses in the city of Rajkot. At present, it specializes in both commercial printing and packaging printing but it had major plans for expansion into packaging printing and converting and finishing. In the commercial printing segment, it prints catalogs and brochures for customers in the real estate and tiles sector. Vinayak also prints leaflets, posters, folders and visual aids. In the carton packaging segment, the company services mostly customers in the FMCG industry.

Shah had planned to buy a 7-color press from either Heidelberg or Komori or K&B. In the converting department, Shah was looking to add a folder-gluer and an autoplaten die-cutter. At present, Vinayak Offset operates two offset presses; a Heidelberg and a Komori. Vinayak Offset was the first printer in India to buy a fully loaded Komori LSX 629, a 6-color UV press with coater in 2016. The two presses are placed at Vinayak’s plant at Lohanagar, Rajkot’s printing hub. It also has a second plant outside the city that houses its finishing equipment.

A severe slowdown in both commercial & packaging print

The broader Indian economy has been facing a slowdown with the latest quarterly GDP growth figures coming at 4.9% (rounded off by the government to the media to 5%), the lowest in many quarters. According to Shah, the current slowdown is the worst that he has seen since he entered the printing business almost a decade ago.

“I have been in the printing industry for almost ten years and what I am seeing now is the worst since I entered this industry. Volumes in both carton and commercial segments are down sharply. We at Vinayak have seen volume in our packaging division drop by 50% in the last six months. The commercial printing division is even more battered with volumes down close to 70-80%,” Shah says.

According to Shah, the slowdown has accelerated in the last six months and he cites a lack of liquidity as one of the main reasons for the slowdown.

He says certain government policies have also adversely impacted the carton business. Recently, the central government put restrictions on imports of agarbatti (incense sticks) and other similar products amidst reports of a significant increase in imports from countries like China and Vietnam.

“The central government’s decision to restrict imports of agarbatti has impacted printers who were printing cartons for the agarbatti companies. The volumes of imports have declined and as a result, carton printers are printing fewer numbers of cartons. I know that the government wants to promote the Indian agarbatti industry but this was a sudden decision. The industry should have been given time to make adjustments,” he says.

A prolonged slowdown may lead to closures

The slowdown in the industry has been going on for more almost six to eight months and, according to Shah, if it continues the commercial and packaging printing industry may see closures.

“As I have already told you that the volumes are sharply down and if this continues a lot of smaller printers may opt to shut shop. We were hoping for a print demand revival during the busy festival season that starts with Ganesh Chaturthi and goes on till Diwali. But unfortunately, it seems this year it does not look very optimistic,” Shah concludes.

Packaging South Asia — resilient, growing and impactful — daily, monthly — always responsive

The multi-channel B2B in print and digital 17-year-old platform matches the industry’s growth trajectory. The Indian, South Asian, Southeast Asian, and Middle East packaging industries are looking beyond the resilience of the past three years. They are resuming capacity expansion and diversification, with high technology and automation in new plants and projects.

As we present our 2024 publishing plan, India’s real GDP growth for the financial year ending 31 March 2024 will exceed 6%. The packaging industry growth will match the GDP growth in volume terms and surpass it by at least 3% in terms of nominal growth allowing for price inflation in energy, raw materials, consumables, and capital equipment.

The capacity for flexible film manufacturing in India increased by 45% over the past four years. With orders in place, we expect another 20% capacity addition in 2024 and 2025. Capacities in monocartons, corrugation, aseptic liquid packaging, and labels are grown similarly. As the consumption story returns over the next six months, we expect demand to return and exceed the growth trajectory of previous years. The numbers are positive for most of the economies in the region – and as shown by our analytics, our platform increasingly reaches and influences these.

For responsible and sustainable packaging, with its attendant regulations and compliances, there is significant headroom to grow in India and the region. Our coverage includes the entire packaging supply chain – from concept to shelf and to waste collection, sorting, and recycling.

We target brand owners, product managers, raw material suppliers, packaging designers and converters, and recyclers. This is a large and complex canvas – the only thing that can work is your agile thinking and innovation together with our continuous learning and persistence.

The coming year looks to be an up year in this region, and this is the right time to plan your participation and marketing communication – in our rich and highly targeted business platform with human resources on the ground. Share your thoughts and plans to inspire and mobilize our editorial and advertising teams!

For editorial info@ippgroup.in — for advertisement ads1@ippgroup.in and for subscriptions subscription@ippgroup.in

– Naresh Khanna (25 October 2023)

Subscribe Now
unnamed 1


Subscribe to our Newsletter


Please enter your comment!
Please enter your name here