Emami Paper Mills Ltd, the country's largest newsprint manufacturer, has decided to increase investment in paperboards to Rs 2,000 crore in the next three years to strengthen its diversification to the high-margin segment.
"We want to double the capacity of paperboard from 1.3 lakh tonne per annum over the next three years," Emami Paper ED P S Patwari said.
Buoyant growth of consumerism has recently led to diversification into multi-layered coated paperboard production in Balasore and the company would continue to focus on value added paperboard segment worth Rs 4,000 crore, Emami group director Aditya Agarwal said.
The segment is expanding at the rate of 15 per cent per annum and higher capacity addition is no threat to the industry given the growth trend.
Agarwal said 2016-17 onwards, at least 60 per cent revenue of Emami paper will come from specialty paperboard. Emami is running trial production of the 1.3 lakh tonne annual capacity paperboard unit and said will start commercial production from December with 20 per cent market share in the country.
ITC, JK Paper and Century are also present in this segment of paper business.
Though the company is the largest domestic newsprint producer in the country, it has no plan to expand due to unfavourable government outlook on Indian newsprint makers, the company officials said.