Hind Glass setting up largest glass complex

Hindusthan National Glass and Industries Ltd (HNG), the largest glass container manufacturer, is setting up the largest integrated glass complex with an outlay of Rs4,000 crore at Naidupet in Andhra Pradesh.

The project spread in about 210 acres will have five furnaces with three furnaces to manufacture glass containers and two to make float glass used in architecture and interior decoration.

“The first phase is being taken up with an outlay of `700 crore by setting up a 650 tonne furnace. The first phase will commence production in March 2012. The other furnaces will be taken up over a period of time and we expect the entire complex to be ready for commercial production in the next seven to ten years,” Mukul Somany, HNG’s vice-chairman and managing director, told DNA.

The company has been working on an ambitious goal of almost doubling its capacity from the existing 2,875 tonnes per day (TPD) to about 5,800 TPD in the next three years.  “The demand is increasing for glass containers as the demand for the products manufactured by our customers from various sectors including liquor, beer and pharmaceuticals increases. In fact, the increase in demand in these sectors translates into the rise in demand for packaging products as well,” he said.

The company is already working on adding at least 1,300 TPD capacity to its existing base by March 2012 by taking up certain brownfield expansion projects in other parts of the country.

“We hope to get some additional capacity into production during 2011-12. But, the full benefit of the expanded capacity would be reflected in our books during 2012-13,” he said.

HNG currently has a share of about 55% in the domestic glass containers market. During the third quarter ended December 2010, the company’s revenue rose 14% at Rs399 crore on year. However, the net profit witnessed a drop from Rs33 crore to Rs31.4 crore.

“The drop was due to the increase in power tariffs, fuel costs and also packaging costs. But, since we are into a B2B segment, we won’t be able to pass on the increase in costs immediately to the customers. There is a lag in doing so,” he said. The company is hoping to close the year with a turnover of Rs1,650 crore by March 2011.