Financial Daily from THE HINDU group of publications
Thursday, Jul 22, 2004
Eagle group to invest Rs 100 cr in new diary making facility
Mr M.J. Prathapsingh, Proprietor, Eagle Press.
Chennai , July 21
THE Eagle group, leading players in printing and stationery products, is to invest Rs 100 crore in a new diary manufacturing facility to tap the export market, according to Mr Prathapsingh, Eagle Press's proprietor.
Expected to start production in about two years, the new unit will double Eagle's current annual production capacity of about 40 lakh diaries, notebooks and writing pads.
Land for the project has been purchased at Karanodai, about 30 km north of Chennai, he said.
"The group is cash rich and the banks are willing to extend loans." While declining to elaborate further, he said a public issue was also being explored.
Diary manufacturing is expected to pick up in a big way in the coming years with developed countries looking to India as a production centre.
The cost of production in the country is at least 70 per cent lower than in developed countries, the UK for instance, according to Mr Prathapsingh.
He expects a 25 per cent increase in diary exports from the country as compared to last year when there was a 15 per cent jump over 2002. The projection is based on export enquiries, and the trend will hold, he said.
Diary producers in the country can corner a major share of the high value segment. For the lower-end products China is a preferred producer because of cost advantage. However, if the Union Government were to cut back on some levies the manufacturers here can compete in the lower end segment also, he said. Eagle's diary range extends from the Rs 16 pocket diary to the hard cover version for Rs 1,400.
India can match the best of production technologies and skills; it is marketing that is the weak link. Eagle's designs are well accepted in the European market and it is looking at marketing opportunities.
Some leading international brands have evinced interest and Eagle may dedicate a part of the production capacity to produce diaries for specific brands. About 40 per cent of its production is under its own brand now and the balance is on orders from others. It has a 30 per cent market share in the branded diary segment.
The new unit will have German equipment for printing and high-speed bookbinding. It will produce diaries, notebooks and a range of other printed items.
Eagle is also into producing smart cards and has a security press for printing cheques. It also has a wind farm and exports about 30 lakh units of electricity to the State grid.
A high-end diary
TO most of us a diary is connected to the start of the New Year. Not so for the diary makers, for whom the `diary season' starts in July when orders start coming in. Despatches will start in September. But they are busy year around because new designs have to be thought up, not to speak of content and paper selection. This process starts in January, when they also start taking in export orders for the next year.
Eagle Press, which makes nearly 150 types of diaries, will launch the Chairman's Special Edition 2005 costing about Rs 1,450 next year for the `high-end corporate user.' It will also have perforated note pad. In double colour handcrafted leather finish cover, Eagle will also throw in a Parker pen free.
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