After the announcement of demonetization in 2016, and the GST in 2017, the past two years have proved to be both challenging and eventful for the label industry in India. Though the industry was in complete support of these reforms, it didn’t deny that the two policies have affected business in India. While many said that the regime played a huge role in slowing business for an extended period, some felt that the reforms couldn’t disrupt their growth because of the huge scope in the labels business. In a period of caution for label converters, many managed to stay profitable.
According to Harveer Sahni of Omet, the Indian label industry has never gone below double-digit growth. “Over the last two or three years, the industry has been growing irrespective of the new tax regime that was introduced and the demonetization. In the last financial year, we installed 4 new presses,” he says. According to Sahni, his company is already in talks with four or five customers for new presses to be installed in this financial year. He says that it is difficult to predict if these orders will go through as customers take some time to understand their requirements before zeroing in on a particular press manufacturer. Nevertheless, he says that he is extremely optimistic about press installations, which according to him will go up this year. He says that the value of imports is increasing every year. This year, Omet presses imported were valued at nearly Rs. 4 crore.
Multitec hopes for yet another promising year
Amit Ahuja shares that Multitec sold 23 label presses in FY 2018-19. He feels that the label market is becoming competitive with time but that hasn’t yet curbed growth. The market’s rapid growth is opening up more opportunities for the Indian label press manufacturers. Ahuja feels that the imports will decline over time with the increasing share of Indian press manufacturers in the market. Ahuja says his company is targeting to sell at least 28 presses in FY 2019-20. Thus far, in April and May, Multitec has sold three presses, two that have been exported while the third one has been installed in the country.
An eventful FY 2018-19 for Alliance Printech
Jatinder Kumar Julka, chief executive officer of Alliance Printech , says that the previous year was eventful for his company. According to him, Alliance sold close to 10 label presses in FY 2018-19. “Indian manufacturers have started to dominate the market. The imports from Europe have declined rapidly. The sale of used machines in the country has also gone down over the last two years. I think in FY 2019-20, while more than 100 label presses will be installed throughout the country, Alliance is targeting to sell 15 machines. We have so far in April and May confirmed 3 to 4 orders. They will be installed soon and our team is working on these installations,” says Jhulka.
Indian manufacturers gaining dominance
Jimit Mittal, vice president of Monotech India which manufactures digital label presses, says that in FY 2018-19, the company exported 5 machines and installed 2 in India. “The imports of digital label presses are still at a very nascent stage in India. I feel not more than 6 machines must have been imported in the past year. The number of Indian press manufacturers is increasing with time and gaining dominance in the Indian market. Monotech is aiming to sell at least 15 digital label presses in FY 2019-20,” he shares. He further adds that the Indian market for digital label presses has been growing at a pace of 20-25% since the last year. “I can also say that more than 50% of the label converters in India will move to digital looking at the current trend and how digital is being widely accepted in the market,” he says.
Vinsak forecasts a sluggish year for label industry
Ranesh Bajaj of Vinsak says that the company imported and sold close to 16 flexo label presses in India in the past year. “The Indian label industry is growing at the rate of 30% CAGR. This doesn’t only include self-adhesive labels, but also shrink sleeves, wrap-around labels and other forms of labels. I think we were lucky in 2018 as a lot of replacement was happening in the industry and that helped us perform well in the market. According to me, 2019 might be a little slow as compared to the last year. We are targeting a realistic figure, close to 15 presses in FY 2019-20. The imported presses in the industry might be close to 30 and by imported presses I mean branded European presses; I’m not including the Chinese ones,” says Bajaj.