With an objective to fulfill the demand and supply gap in hardwood face veneer by Indian Plywood units, Century Plyboards ventured in Laos and had started manufacturing of face veneer two years back and formed a Joint Venture subsidiary. The situation changed after Laos Government imposed ban on export of face veneers and said that they only allow finished products that is Plywood. The decision of local government has compelled face veneers manufacturing company to opt for plywood production or shut down operation. Taking opportunity from the present scenario, Century Ply is now gearing up to take the advantage in its fold by focusing on plywood manufacturing in Laos.
Recently Century Plyboards has announced to acquire a majority (51 per cent) stake in Laos-based Huesoulin Wood Processing Factory and Century Huesoulin Plywood Lao Co has now become a step-down subsidiary of Century Plyboards. The company also has decided to leverage the Laos unit for plywood production. “Earlier the focus was on veneer and plywood. Now, the stress will be more on plywood and the lower cost of production (as compared to India) should benefit us,” says Mr. Keshav Bhajanka, Executive Director, Century Plyboards.
With this decision, Company is going to expand its production capacity by adding more production line, and will export Plywood to India, which they seem to add the growth of the company because the company calculates that the production cost at Laos is much lower than India.
The company feels that cost of production in Laos is at least 20 per cent lower than that of India and manufacturing plywood will help in better earnings for Century Ply. The Laos establishment will be around 10 per cent of Century Plyboards’ total production which will help in expanding company markets share in different regions and domains.