Mumbai-based Nipra Industries is India’s leading aluminum closure stock converter engaged in the manufacture of aluminum Roll-On-Pilfer-Proof (ROPP) closures, printed aluminum sheets and printed tinplate sheets. Its target customers are from the beverages segment, mainly in the alcoholic beverages space. In an attempt to test new waters, the company now plans to diversify into some other potential areas of business.
“We have identified a few other potential areas. Next financial year we could see some progress on a new product line related to our current printing set-up but would not be associated with alcoholic beverages. It would be a forward integration onto a new industry,” says Nikhil Jain, executive director of Nipra Industries.
The decision to diversify was taken to reduce reliance on one segment. “Alcohol consumption is something which is not encouraged in India. Clamor for prohibition in a few states is also growing louder. Bihar has already imposed complete prohibition, on both consumption and production of liquor. This resulted in a big setback to some leading companies. All this creates a lot of unpredictability and uncertainty for the industry players,” he says.
Metpack 2017, which will take place from 2 to 5 May in Essen, Germany, is where Jain plans to be to get better insight into the potential new areas. Jain will also be meeting machine suppliers, as Nipra is looking to buy some printing machines to expand its printing capacity. The company currently employs mostly Japanese sheet printing machines at all its plants. Nipra has six manufacturing plants, one at Roorkee, two at Silvassa, one at Umargaon, one at Vasai and one at Bengaluru.
Demonetization and other disruptions
Alcoholic beverages segment is one in which cash transactions have traditionally been high. The Indian government’s decision to demonetize impacted the industry hard. As a supplier of closures to the alcoholic beverages manufacturers, Nipra too faced several disruptions due to the government’s decision. According to Jain, post demonetization, the company saw drop in orders to the tune of 30%. As if this was not enough, another big disruption that will hit the alcoholic beverages industry from 1 April 2017 is that of ban on liquor shops on national as well as state highways across the country. The Supreme Court of India last year banned the sale of alcohol within 500-m radius of state and national highways. The apex court further directed that all concerned authorities comply with the order and desist from issuing any new licenses for opening liquor shops along the highways.
“This development will have a bigger impact on our business than demonetization. Post the imposition of the ban, the industry will take some time to adjust to the new reality. Then the goods and services tax (GST) is expected to come into force from July. So, with all these disruptions, the industry will remain in a state of flux till August or September this year,” Jain feels.
Exports
Jain will be also going to interpack 2017 but this time just as a visitor. Nipra participated in the last two editions of interpack as an exhibitor. It was Nipra’s first participation in interpack 2011 that opened the company to the global market. During interpack 2014, the company was at the metal packaging plaza. In the last five to six years, Nipra has managed to venture into some new areas in the Southeast Asian and African regions. About 15% of total turnover of Nipra comes from exports.
“Since our first participation at interpack, we have managed to capture new areas. We will continue to focus on exports,” Jain says.
