Feb 20, 2018
Toray Industries, Inc.
Toray to Expand Business in India
February 20 2018, Tokyo-Toray Industries, Inc. (President: Akihiro Nikkaku; hereinafter referred to as "Toray") announced today that it acquired a business plot, about 350,000 m2in size, in Sri City, Andhra Pradesh, India, for a new base for its local subsidiary Toray Industries (India) Private Limited (abbr. TID).
Toray positions the new site as an important base for the Toray Group’s advanced materials business and plans to aggressively invest management resources in it and utilize it as the global operation base in response primarily to the domestic demand in India and targeting South Asia in various business fields where demand is expected to expand.
As a first step, Toray decided to establish a new base for its polypropylene (PP) spun bond for hygiene materials business, whose market is expected to expand along with the increasing demand for disposable diapers. The company will make sure to capture the demand in India, where the disposable diapers will be consumed, and accelerate the global business expansion of PP spun bond with a powerful production platform and high cost competitiveness. The new facility will have an annual production capacity of about 18,000 tons and is expected to start operations in April 2020.
Further, Toray plans to build new bases for nylon and PBT resin compounds in response to the demand for high performance resins given the expansion of the automobile market.
The Indian economy is a promising market that is expected to grow at an annual rate of 6% from 2016 to 2030 and global businesses in various industries including manufacturing industries such as automobile, home electric appliances, chemicals, pharmaceuticals and construction machinery as well as retail and financial industries are making forays into the country.
As for disposable diapers, where PP spun bond is mainly used, the demand is expected to rapidly increase as economic development leads to increased income lifestyle changes. The birth rate is also expected to be high given the country’s population, the second largest in the world (about 1.34 billion people according to 2017 United Nations material), and major hygiene material manufacturers have been aggressively expanding their business in India, a potential market, in response to the expanding demand for diapers.
Moreover, the automobile market in India is expected to grow at a rate of 7% per year towards 2025 due to the economic development. In addition, it is believed that the requirement for Toray’s high performance materials will increase given the expanding demand for high performance auto parts and sophistication of customer demands along with the tightening of environmental restrictions in recent years. In response, Toray plans to establish nylon resin and PBT resin compound bases in India and capture the growing Indian market.
Starting with the establishment of trading firm Toray International India Private Limited (abbr. TIID) in 2011, Toray in India set up Toray Industries (India) Private Limited (abbr. TID), a local subsidiary to carry out market research and to support the business expansion of the Toray Group companies in and entry into India in 2014 and began production and distribution of airbag fabrics at Toray Kusumgar Advanced Textile Private Limited (abbr. TKAT), the Toray Group’s first manufacturing base in India, in 2016.
As one of the basic strategies of the medium-term management program “Project AP-G 2019” launched in April 2017, the Toray Group pursues the expansion and advancement of global business, and has been working on “AE Project” to expand its business globally by capturing profit opportunities in growth countries and regions in a Group-wide project.
The acquisition of the new business site and start of the business in India is part of this “AE Project”. The Toray Group will continue to further strengthen the organic collaboration among bases outside Japan and strongly pursue new market expansion.
1. Profile of TID
|(1) Name||:||Toray Industries (India) Private Limited (abbr. TID)|
|(2) Established||:||January 2014|
|(3) Location||:||Gurgaon (Haryana State)
near India’s capital of New Delhi
Toray Group bases in India
|(4) Capitalization||:||2, 550 million INR|
|(5) Investment ratio||:||Toray Industries, Inc. 99.99%
Toray International, Inc. 0.01%
|(6) Representative||:||Shigekazu Suenaga|
|(7) Business||:||Research of the Indian market and support for Toray Group companies’ business expansion in and entry into India|
2. PP spun bond production capacity at the Toray Group (as of February 2018)
Toray Industries, Inc., founded in 1926, is an integrated chemical industry group developing its businesses in 26 countries and regions worldwide. Its consolidated revenues for fiscal 2016 (ended March 31, 2017) totaled 2,026.5 billion yen ($18.1 billion). In addition to the fibers & textiles created at the time of its establishment, Toray has gone on to create cutting-edge, high value-added products including films, fine chemicals, plastic resins, electronics & information-related products, as well as carbon fiber composite materials, pharmaceutical and medical products, and products for the water treatment and environmental fields. For more information on Toray, please visit the company's website at//www.toray.com