Kraft Paper Industry - Investment Project Opportunity for Startups and Entrepreneurs: Poised for Continuous and Rapid Growth in the Coming Years, Kraft Paper from Waste Carton Boxes, Sack Kraft Paper, Brown Craft (Kraft) Paper, Packaging Paper, Agro & Recycled Paper Mill, MG Kraft Paper, Papermaking, Pulp and Paper Industry, Paper from waste Paper, Paper Recycling, Manufacturing Plant, Detailed Project Report, Profile, Business Plan, Industry Trends, Market Research, Survey, Manufacturing Process, Machinery, Raw Materials, Feasibility Study, Investment Opportunities, Cost and Revenue, Plant Economics, Production Schedule, Working Capital Requirement, Plant Layout, Process Flow Sheet, Cost of Project, Projected Balance Sheets, Profitability Ratios, Break Even Analysis

Kraft paper, Brown paper or wrapping paper is made from variety of raw materials, e.g. Bagasse, ground wood, straw, waste paper, in various combinations or alone, waste carton boxes etc. 'Kraft' mean strength and that is why its name. It is leading paper for wrapping heavy bundles. After corrugation it is used in many types of packing and it is an important packaging material.

Kraft papers or brown papers are strong and flexible and quality Kraft paper are made by the 'Kraft' chemical process or also known as sulphate process. They are normally sized with sizing agents & additives are added, and not bleached. The colour is only a natural colour. They are used in wrapping paper bags, linters corrugated sheets.

Kraft paper exists in many grades. Here colour and surface finish are of secondary importance and the main requirements are that the paper should be strong and that it should provide some protection to wrapped goods, especially the rain this protection is achieved mainly by engine sizing. The fibres should be long, strong & beaten to give a sheet having maximum strength. Bleaching is avoided since it tends to reduce strength and is normally unnecessary for such paper and strong brown Kraft pulp is widely used. Brown wrapping papers are frequently machine-glazed (abbreviated MG) by allowing them to dry with one side in contact with a polished, beated cylinder, much as a photographer glazes his prints. The side in contact with the heated cylinder receives a bright glossy finish, while the other side remains rough. Paper is a biodegradable material; this means that when it goes to landfill it will rot; bacteria will form and produce methane.  This is a powerful greenhouse gas that is 23 times more potent than CO2 (carbon dioxide) and contributes to climate change.  We currently recycle 66% of the paper we use.

Manufacturing virgin (brand new) paper uses more energy than making recycled paper, but varies dependent on the grade or type of paper being made. By using waste paper to produce new paper disposal problems are reduced. Moreover producing recycled paper involves between 28 - 70% less energy consumption than virgin paper and uses less water.

Kraft paper or Kraft is paper produced from chemical pulp produced in the kraft process. Kraft paper is ideal for a variety of packaging uses. The market is well established in North America and western countries, and it is expected to grow linearly over the forecast period. Growing economies such as China, India and Brazil are expected to emerge as most attractive geographical segment in global Sack Kraft Paper Market.

Sack Kraft paper is distinguished by elevated elasticity and it can be easily customized depends on end-user requirement. Based on its elasticity, sack kraft papers are commercially available in market which includes natural kraft paper, semi-extensible kraft paper, extensible kraft paper and coated kraft paper.

The Indian economy is growing and so is the Paper Packaging industry. As growth rides on increased industrial production and international trade, demands on package converters have become more intense and sophisticated.

The packaging industry in India has been registering a constant growth rate of 15%. The Corrugated packaging industry is however finding itself at the crossroads. Increasing prices of kraft paper, non availability of international standard papers at affordable prices, resistance of corrugated box user industry to offer sustainable prices, increasing competition, non viability of automatic plants are proving to be hurdles in the growth path.

The total demand for paper is estimated to be around 6 mn tones, of which about 40 percent is consumed by the packaging industry.

The Indian paper industry accounts for about 3% of the world’s production of paper. The estimated turnover of the industry is INR 50,000 crore (USD 8 billion) approximately and its contribution to the exchequer is around INR 4,500 crore. The industry provides employment to more than 0.5 million people directly and 1.5 million people indirectly.

Paper consumption in India is expected to grow to 14m tpa by 2015. The major growth sectors will be in container board (to 3.9m tpa), uncoated wood-free grades(to 3.6m tpa), carton board (to 2.8m tpa) and newsprint(to 3m tpa).

Total Paper Consumption is about 1.50 Million Tons per annum. Approx 5.00 Lacs Ton High Burst Kraft Paper is used in Corrugation. Approx 10.00 Lacs Ton Semi-Kraft and Low BF Paper is consumed annually. Overall Capacity Utilization is only 70%

Indian FMCG sector is growing ata rapid rate due to strong demand from a large and growing middle class. As a result, the packaging industry, growing by more than 15 percent annually, will likely increase demand for corrugated boxes, leading to increased demand for kraft papers, and the key raw material.

The Current demand of Corrugation packaging is in line with the industrial growth. Presently corrugation industry is growing at the rate of 10% per annum and is expected to grow at 12% per annum in near future.

There is a very good scope and ample space for new entrants in this field.

Few Indian Major Players are as under:

A P R Packaging Ltd.

Agrashakti Paper Mills Pvt. Ltd.

Aryan Paper Mills Ltd.

Ashutosh Paper Mills Ltd.

Aurangabad Paper Mills Ltd.

Ballavpur Paper Mfg. Ltd.

Bazargaon Paper & Pulp Mills Pvt. Ltd.

Best Paper Mills Pvt. Ltd.

Bindlas Duplux Ltd.

Bio Green Inds. Ltd.

Bio Green Papers Ltd.

Brown Paper Technologies Ltd.

Chadha Papers Ltd.

Chandpur Enterprises Ltd.

Chemopulp Tissues Ltd.

Cochin Kagaz Ltd.

Craft Corner Paper Mills Ltd.

Daman Ganga Board Mills Pvt. Ltd.

Deoria Paper Mills Ltd.

Dev Priya Inds. Ltd.

Dev Priya Product Ltd.

Ellora Paper Mills Ltd.

Galaxy Papers Pvt. Ltd.

Ganga Papers India Ltd.

Genus Paper Products Ltd.

Godavari Pulp & Papers Mills Pvt. Ltd.

Goodwill Team Papers Ltd.

Greenland Paper Mills Ltd.

Hardoli Paper Mills Ltd.

J B Daruka Papers Ltd.

Kalptaru Papers Ltd.

Kay Power & Paper Ltd.

Khatema Fibres Ltd.

Maheshwari Paper Ltd.

Malu Paper Mills Ltd.

Maruti Papers Ltd.

Meenakshi Paper Mills Pvt. Ltd.

Midland Plastics Ltd.

Mira Textiles & Inds. (India) Ltd.

Modinagar Paper Mills Ltd.

Mukerian Papers Ltd.

Multiwal Pulp & Board Mills Pvt. Ltd.

Naini Papers Ltd.

Nathani Paper Mills Ltd.

Nav Bharat Tissues Ltd.

Nice Papers Ltd.

Nikita Papers Pvt. Ltd.

Parijat Paper Mills Ltd.

Parth Industries Ltd.

Paswara Papers Ltd.

Prism Industries Ltd.

Rana Mohendra Papers Ltd.

Rana Papers Ltd.

Remco Paper & Board Inds. Ltd.

Ruby Macons Ltd.

Sainsons Paper Inds. Ltd.

Saurashtra Paper & Board Mills Ltd.

Shah Paper Mills Ltd.

Shakumbhri Pulp & Paper Mills Ltd.

Shakumbhri Straw Products Ltd.

Shivashakti Paper Mills Ltd.

Shree Acids & Chemicals Ltd.

Shree Ajit Pulp & Paper Ltd.

Shree Ambeshwar Paper Mills Ltd.

Shree Sita Ram Paper Mills Ltd.

Shri Ramchander Straw Products Ltd.

Siddheshwari Paper Udyog Ltd.

Sikka Papers Ltd.

Sukhna Paper Mills Ltd.

Sukhraj Agro Papers Ltd.

T T Maps & Publications Ltd.

Umesh Board & Paper Mills Pvt. Ltd.

Unitech Paper Mills Pvt. Ltd.

United Pulp & Paper Mills Ltd.

Universal Paper Mills Ltd.

Vaibhav Paper Boards Pvt. Ltd.

Vamshadhara Paper Mills Ltd.

Vidhi Industries Ltd.

Well Pack Papers & Containers Ltd.

Yash Papers Ltd.

Table of Contents

1.       Introduction

2.       Uses and Applications

2.1.    KRAFT PAPER

3.       Properties

4.       Quality & Standard

5.       B.I.S. Specification

5.1.    IS: 1397 - 1967 Kraft paper

5.2.    IS 1397 (1990): Kraft Paper

6.       Raw Materials

6.1.    Waste Paper

6.2.    Waste Paper Sorting

7.       Qualities of Waste Papers

7.1.    GROUP-A: Mixed Paper Quality

7.2.    GROUP - B: Middle Qualities

7.3.    GROUP - C: High Qualities:

8.       Composition of Waste Paper

8.1.    Paper Types, Paper Use and Recovery, and Paper Grades

9.       Grades of Waste Paper

9.1.    Sources of Waste Paper and Its Collection

9.2.    Waste Paper from Households

10.   Classification and Definitions of Different Grades of Paper – Board

10.1.Card Board:

10.2.Mill Board:

10.3.Grey Board:

10.4.Duplex Board:

10.5.Box Board:

10.6.Coated Board:

10.7.Art Board:

10.8.Chromo Board:

10.9.Coated Box Board:

10.10.      Clay-Coated Blanks:

10.11.      Blanks:

11.   Manufacturing Process

11.1.For Making Kraft Paper

11.2.Cooking Composition with Water:

11.3.Preparation of the Mix or Pulping:

11.4.Paper Making:

12.   Chemicals Required

13.   Paper Making Machine

13.1.Cylinder Mould Machine

14.   Process Flow Diagram

15.   Water Supply and Energy Consumption in Pulp and Paper Mills

15.1.Raw Water Treatment

15.2.Process Water Treatment

15.3.Boiler Feed Water Treatment

15.4.Energy Consumption in Pulp and Paper Mills

15.5.Effluent:

16.   Environmental Impact

16.1.Problems in Recycling

16.2.Major Factors Affecting Energy Consumption in Paper Mills

16.3.Other Factors

16.4.Structure of a Strategic Energy Management System

17.   Suppliers of Plant & Machinery

17.1.Complete Machinery Suppliers

17.2.EOT Cranes

17.3.Weigh Bridge and Weighing Equipments

17.4.Pipelines & Fittings

17.5.Paint and Insulation

17.6.Laboratory Equipment

17.7.Maintenance Equipment

17.8.Pollution Control Equipment

18.   Suppliers of Raw Material

18.1.Waste Cartons

18.2.Sodium Hydroxide

18.3.Alum

18.4.Rosin

18.5.Starch

18.6.Soda Ash

18.7.Sodium Borate (Borax)

18.8.Other Chemical Suppliers

19.   Plant Layout

20.   Raw Material, Machinery & Product Photographs

20.1.Carton Boxes

20.2.Sodium Hydroxide

20.3.Alum

20.4.Rosin

20.5.Starch

20.6.Soda Ash

20.7.Sodium bicarbonate

20.8.Cylindrical Blow Tank

20.9.Johnson Type vibrating screen

20.10.      Cylindrical Caustic Solution Tank

20.11.      Hydro Pulper

20.12.      M.G. Section

20.13.      Dryer Section

20.14.      Press Section

20.15.      Hydraulic Press

20.16.      Boiler

20.17.      Kraft Paper

21.  Quotation of Plant, Machinery and Equipments from Supplier
 

PROJECT FINANCIALS

·         Project at a Glance

Annexure

·         Assumptions for Profitability workings ….…………………………………………....................... 1

·         Plant Economics…………………………………………………………………………….................... 2

·         Production Schedule……………………………………………………………………….................... 3

·         Land & Building…………………………………………………………………………….................... 4

§  Factory Land & Building

§  Site Development Expenses

·         Plant & Machinery………………………………………………………………………….................... 5

§  Indigenous Machineries

§  Other Machineries (Miscellaneous, Laboratory etc.)

·         Other Fixed Assets………………………………………………………………………….................... 6

§  Furniture & Fixtures

§  Pre-operative and Preliminary Expenses

§  Technical Knowhow

§  Provision of Contingencies

·         Working Capital Requirement Per Month………………………………………………................. 7

§  Raw Material

§  Packing Material

§  Lab & ETP Chemical Cost

§  Consumable Store

·         Overheads Required Per Month and Per Annum ……………………………………................. .8

§  Utilities & Overheads (Power, Water and Fuel Expenses etc.)

§  Royalty and Other Charges

§  Selling and Distribution Expenses

·         Salary and Wages ……………………………………………………………………………................. 9

·         Turnover Per Annum ………………………………………………………………………................ 10

·         Share Capital…………………………………………………………………………………................ 11

§  Equity Capital

§  Preference Share Capital

•        Annexure 1            ::        Cost of Project and Means of Finance

•        Annexure 2            ::        Profitability and Net Cash Accruals

§  Revenue/Income/Realisation

§  Expenses/Cost of Products/Services/Items

§  Gross Profit

§  Financial Charges    

§  Total Cost of Sales

§  Net Profit After Taxes

§  Net Cash Accruals

 

•        Annexure 3            ::        Assessment of Working Capital requirements

§  Current Assets

§  Gross Working Capital

§  Current Liabilities

§  Net Working Capital

§  Working Note for Calculation of Work-in-process

 

•        Annexure 4            ::        Sources and Disposition of Funds

•        Annexure 5            ::        Projected Balance Sheets

§  ROI (Average of Fixed Assets)

§  RONW (Average of Share Capital)

§  ROI (Average of Total Assets)

 

•        Annexure 6            ::        Profitability ratios

§  D.S.C.R

§  Earnings Per Share (EPS)

§  Debt Equity Ratio

 

•        Annexure 7            ::        Break-Even Analysis

§  Variable Cost & Expenses

§  Semi-Variable/Semi-Fixed Expenses

§  Profit Volume Ratio (PVR)

§  Fixed Expenses / Cost 

§  B.E.P

 

•        Annexure 8 to 11   ::        Sensitivity Analysis-Price/Volume

§  Resultant N.P.B.T

§  Resultant D.S.C.R

§  Resultant PV Ratio

§  Resultant DER

§  Resultant ROI

§  Resultant BEP

 

•        Annexure 12          ::        Shareholding Pattern and Stake Status

§  Equity Capital

§  Preference Share Capital

 

•        Annexure 13          ::        Quantitative Details-Output/Sales/Stocks

§  Determined Capacity P.A of Products/Services

§  Achievable Efficiency/Yield % of Products/Services/Items 

§  Net Usable Load/Capacity of Products/Services/Items   

§  Expected Sales/ Revenue/ Income of Products/ Services/ Items   

 

•        Annexure 14          ::        Product wise domestic Sales Realisation

•        Annexure 15          ::        Total Raw Material Cost

•        Annexure 16          ::        Raw Material Cost per unit

•        Annexure 17          ::        Total Lab & ETP Chemical Cost

•        Annexure 18          ::        Consumables, Store etc.

•        Annexure 19          ::        Packing Material Cost

•        Annexure 20          ::        Packing Material Cost Per Unit

•        Annexure 21          ::        Employees Expenses

•        Annexure 22          ::        Fuel Expenses

•        Annexure 23          ::        Power/Electricity Expenses

•        Annexure 24          ::        Royalty & Other Charges

•        Annexure 25          ::        Repairs & Maintenance Expenses

•        Annexure 26          ::        Other Manufacturing Expenses

•        Annexure 27          ::        Administration Expenses

•        Annexure 28          ::        Selling Expenses

•        Annexure 29          ::        Depreciation Charges – as per Books (Total)

•        Annexure 30          ::        Depreciation Charges – as per Books (P & M)

•        Annexure 31          ::        Depreciation Charges - as per IT Act WDV (Total)

•        Annexure 32          ::        Depreciation Charges - as per IT Act WDV (P & M)

•        Annexure 33          ::        Interest and Repayment - Term Loans

•        Annexure 34          ::        Tax on Profits

•        Annexure 35          ::        Projected Pay-Back Period And IRR

 

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