Dynaplast to set up packaging plant in India

JAKARTA (JP): Publicly listed PT Dynaplast plans to set up a packaging plant in Hyderabad, southern India, and a local joint venture to produce cubic printing products with a Rp 28 billion (US$12.07 million) total investment.

Company president Tony T. Hambali said shareholders had agreed to the plan in their extraordinary meeting yesterday.

It would cost about Rp 20 billion to set up the plant in India, Tony said after the meeting.

He said 93 percent of the Rp 20 billion would come from company equity and 7 percent from bank loans.

He said the new Indian firm, to be named Dynaplast Packaging India, would produce several types of plastic bottle -- for food, drinks, cosmetics, pharmaceuticals and house cleaning goods -- and plastic for vacuum forming industries.

"The raw materials for the plant will be sourced from a number of local (Indian) and foreign suppliers. We don't want to rely on a single supplier," he said.

He said the new plant would start production next November with a 50,000-ton annual capacity.

The local joint venture -- to be called PT Dynaplast Cubic Indonesia -- would be 70 percent owned by PT Dynaplast, 20 percent by PT Karya Agung Alexander and 10 percent by Cubic Co. Ltd. of Japan.

He said PT Dynaplast Cubic Indonesia would use "cubic printing" technology to decorate all kinds of materials, such as marble, tiles, plastics and wood, for houses, furniture, ships and cars.

Tony said the local cubic printing industry needed a Rp 8 billion investment, which would be funded by the company's planned rights issue.

PT Dynaplast Cubic Indonesia would start operating in the middle of next year, he said.

Tony said shareholders also approved the company's plan to issue 65 million rights shares.

Shareholders could subscribe to one new share for every share they hold for Rp 1,200, he said.

"We expect to raise Rp 78 billion from the rights issue," he said.

He said 52 percent of the proceeds would finance its existing plastic plants, 27 percent to finance the establishment of the plastic plant in India, 19 percent to raise its paid-up capital and two percent for its equity in the new joint venture.

Tony said the company's expansion would raise net sales by 69 percent to Rp 152.1 billion next year and by 30 percent annually to Rp 197.7 billion for 1998.

"This year we hope to post a net profit of Rp 13 billion. We expect this will increase 115 percent to Rp 28 billion next year," he said. (bnt)