Greenply is to set up new plywood unit in UP

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Greenply Industries Ltd is expanding its plywood manufacturing capacity by about 40%. The company is setting up a new unit in Hardoi, Uttar Pradesh. The company will add plywood and allied product capacity at the planned facility in Hardoi by 13.5 million sq. m., taking its total capacity to 45.9 million sq.m. This expansion will entail an investment of Rs 120 crore, out of which Rs 80 crore will be funded by debt and the rest through internal accruals, said V. Venkatramani, chief financial officer at Greenply Industries.

In a way, the company is getting ready to meet the expected higher demand as a result of implementation of the goods and services tax (GST), which is likely to encourage a shift from the unorganized to organized markets. In fact, this anticipated shift to organized markets is also a reason for the optimism in the Greenply Industries stock, which has risen as much as 57% so far this fiscal year. “While we are recovering in the current quarter after demonetization, growth is likely to be challenging for the next financial year as well,” said Venkatramani, who expects revenue growth of 5-7% in FY18.

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