Initiating with this issue we are launching a new segment WOW wherein we introduce the paper industry people having hands on experience and are equipped with analytical bent of mind. so we take an opportunity to share this place with Mr. O.P. Goyal, the whole time director of JK Paper Ltd, who has proven record in the industry.
Your words of wisdom for Indian paper industry?
“Geared up for the increased competition” is my mantra which means you have to be proactive on every turf i.e. cost competitiveness, quality of products and services and adopting latest technology. I sense so, because of the interest shown by foreign investors in the Indian paper industry. There is threat from imports in the market. India’s FTA with ASEAN stands as a good example.
What is your outlook on the future of paper industry in India and globally?
Globally the paper growth has been a sluggish but is still moving in a positive range with an expected growth rate of 2.1% in the coming years. In this global meltdown, India is better placed in comparison to other countries as still there is a growth prospect of about 6-7%. The growth will tend to reduce in developed economies due to change in the factors like standard of living and behavior of the people. Moreover, the production centers in the developed countries with high production cost are shutting down and shifting to low cost areas. This is expected to continue.
Demand for paper will be high in future as the education is rising, people are getting better off and thirst for information will ultimately lead to growth in the Indian paper industry. Also India is becoming a preferred destination for printing and publishing hub due to its young population with good proportion of English speaking inhabitants and the latest printing technology.
Raw material has always been a challenge for the Indian paper industry, so what are your views on raw material availability prospects?
Raw material availability is a challenge for global paper industry but is becoming an issue for India because government has been reluctant to come out with an industrial plantation policy. Despite our repeated request there is no outcome. This has accentuated the demand & supply imbalance for the wood pulp. The industry’s own efforts in social and farm forestry had some impact but given a huge requirement for the wood pulp, there is an urgent call for the industrial plantation policy.
In fact the available wood in India is much costlier than countries like Indonesia, Brazil etc. Thus it results in hindering our cost competitiveness on the global scale. Besides there is good potential for plantations in India due its sub-tropical weather which is almost similar to the countries like Indonesia, Malaysia, Vietnam and Latin America etc. If government provides at least 2-3% of the waste land to the paper industry then that will be sufficient for industry’s wood requirement.
I joined the paper industry in 1979 and initiated the first project of Century Pulp & Paper at Lalkua, it was a green field project and was completed in record time. At JK Paper, in the year 1988 I was assigned to close an old sick board plant in Bhopal in a period of 3-4 years which was again accomplished in a record time of 6 months. In 1992 JK Paper acquired a sick plant from BIFR in Songadh. It was turned around within 2 years time due to which we were able to make good profits during 1994 boom. The key to success was that the Management had full confidence in me and I was able to motivate my team. In other words I was empowered to take strategic decisions in all my ventures.
What is the ideology & strategic factors that makes JK Paper an outperformer?
We are the only company present in the high growth paper segments; branded copier growing at 15-16%, coated paper 12-13%, and high-end packaging board 12-15%. We have been pioneers in introducing new products and in converting paper from a commodity driven business to a brand driven business. Our obsession with quality and in finding solutions for the diverse needs of our discerning customers has helped us to introduce newer products on a continuing basis. “While others talk of obsession, we practice.” Thus, we have been able to exceed the customer’s expectation. We motivate and maintain healthy relation with the workers in order to achieve good results.
What are the future growth plans at JK Paper?
We are planning to increase our production capacity for which we will invest around Rs. 120-140 crores in a brownfield project either in Gujarat or Orissa. We are yet to decide upon the paper segment to expand in but certainly we would like to maintain our market in the copier segment by focusing on this particular category. We will adopt the latest technology for both the pulp mill and the paper machine. Additional annual capacity would be 1.5-2 lac tons and we will be able to start the plant with in 3 years.
Most memorable moment…
“When in 1988 I was given the responsibility to close the Bhopal Board plant and we were able to compensate the emotional & financial needs of the entire workforce. There were no tears in the eyes of even a single worker which was a heartwarming moment”.