Finolex eyes four fold growth in CPVC pipes
In view of its recent tie-up with Lubrizol Corporation a Berkshire Hathaway company to make flow guard pipes, Pune-based Finolex Industries is eyeing a four fold growth in its chlorinated polyvinyl chloride (CPVC) pipes business.
“We are doing about 5,000 tonnes of CPVC now and we want to go up to 20,000 tonnes in the next two years. The current market size is 1,00,000 tonnes,” Finolex Industries executive chairman Prakash Chhabria, said.
Finolex will invest an additional Rs 10-15 crore under the initiative to set-up capacities to manufacture CPVC pipes.
Currently, Finolex is heavily invested into manufacturing pipes for the agriculture segment and has an annual capacity to make 2,00,000 tonnes of agri-pipes every year.
According to Chhabria, the reason for heavy focus on CPVC pipes, in addition to agri-pipes, is the huge anticipated growth in the housing sector.
“The opening up of the housing sector is giving us hope for growth. We are talking about 60 sq metre houses (affordable houses), which means in a given parcel of land, you are going to have more flats. So, my business goes up exponentially. Even if the government meets one third of their 1 crore housing plan, it will be huge,” he added.
Lubrizol also has a tie-up with Bangalore-based Ashirvad Pipes to make CPVC pipes. “Between Ashirvad and Finolex Industries, we hope to take about 50% market share in the CPVC market by 2020,” Lubrizol India director Manish Jain, said.
The two companies are also banking on the impending Real Estate Regulation Act (RERA) to give a thrust to their CPVC business. “With RERA, builders have to become more accountable and so our products will find a ready market,” said Jain.