Century Plyboards (India) Ltd has entered into a tie-up with a Chinese door manufacturing company Goldea for making doors and frames. “We have formed a 60:40 joint venture with a Chinese company, Goldea, for manufacturing doors and frames. We will hold 60 % in the JV. Balance 40 % will be held by the Chinese partner,” said Mr. Sajjan Bhajanka, Chairman, Century Ply.
CenturyPly will initially spend about Rs 80 crore on the doors plant, which will have a capacity to produce 2,000 doors a day in the first phase, Mr. Bhajanka said, ‘Adding, it could increase to 6,000 doors a day in later phases. By 2022, the doors and frames market will be about Rs 40,000 crore. Currently there are no organised players in this segment,” said Mr. Keshav Bhajanka, director of the company.
“A new plant for doors and frames will come up close to the company’s medium-density fibreboard (MDF) facility at Hoshiarpur, Punjab. The MDF would be used as the raw materials for the manufacturing of the doors,” he said, adding that the company is in the process of acquiring some more land nearby its MDF plant for setting up the new door plant. The MDF plant, with a capacity of 1,98,000 cubic meter, has started trial production and is likely to begin commercial production in the next few months.
“We have plans to undertake forward integration in the plant by manufacturing value-added products such as tiles, furniture and decorative veneer over the next one year. The investment for the forward integration would be around Rs 200 crore,” Bhajanka said.
With the implementation of Goods and Services Tax, the company is expecting the share of organised sector in the Rs 20,000-crore plywood market would be close to 50 percent in the next two years from the current share of just 25 percent.
Mr. Bhajanka, however, said that plywood falls in the 28 percent rate category in the new indirect tax system which is quite high and the industry is hoping that it could be brought down to 18 percent in the next GST council meet.