"Despite the low per capita consumption levels, the country’s glass container industry is buoyant, with rising demand from local beverage, alcohol, food, pharmaceuticals and cosmetics industries," says Khosla.
Give us an overview of the container glass manufacturing industry in India. How's been the last one year for the industry?
Glass packaging faces fierce competition from other forms of packaging in India. Despite the low per capita consumption levels, the country's glass container industry is buoyant, with rising demand from local beverage, alcohol, food, pharmaceuticals and cosmetics industries. The industry is experiencing a surge in demand, owing largely to the growing purchasing power, urbanisation, modern retail and increasing awareness about the environment, health and hygiene among consumers. The industry's success is likely to continue or possibly improve even further in the future due to rising disposable income and India's GDP rate in the medium term. The local economy has been a major aid for the glass container industry, allowing manufacturers to grow even during these uncertain times.
How the container glass manufacturing sector is helping FMCG and Pharmaceutical companies fight Covid-19 through the supply chain mechanism?
Glass packaging has been one of the important sources of packaging for FMCG and pharma companies. Glass is the only packaging material with the GRAS status from the US FDA. The manufacturers also use a cleanroom environment for glass manufacturing to prevent contamination in glass bottles. Hence, it avoids all kinds of contamination during the storage and supply of products for these companies. On the logistics front, it has been difficult for us to supply to these companies. However, some of the state governments have now included the packaging industry under the list of industries exempted from the lockdown. The recent exemption of non-essential goods will help most of the factories with raw materials. The glass manufacturing sector should be proactive at this stage as the pharma and other essential sectors are putting their utmost efforts into fighting this crisis.
What are the challenges faced by manufacturing companies to deliver products during this lockdown period, and how are they tackling them?
The manufacturing companies faced a lot of trouble when it came to logistics as the lockdown curbed the movement of goods in and out of the districts. The government eased our efforts by including the glass manufacturing sector under essential services. The recent exempt of non-essential goods will help most of the factories with supply materials. As the manufacturing sector faces a huge crisis when it comes to unavailability of raw materials, most companies have stored enough raw materials beforehand to run their business. Few companies will also have an added advantage when they have their own factories manufacturing the required materials, such as sand.
How is the company supporting some of the liquor industry who is providing helping hand to the Government to provide essential good supplies like sanitizers?
In recent days, our country has seen a huge demand for alcohol-based hand sanitizers due to the current crisis. Hence various stores across India have seen shortages for this product. To keep the supply in pace with the demand, we are partnering with some of our liquor clients to come up with bottles suitable for hand sanitizers.
What changes has AGI made to adhere with the government regulations in a fight against the current world crisis?
AGI has made various changes involving the following aspects: input material; workforce; and outward transportation. The input materials are various raw materials that are used for glass production. Soda ash, a primary raw material, has been stocked for up to two months to cater to the demand. AGI has its own sand manufacturing plant, but due to the lockdown, there are chances that certain operations will run partially. Oil, gas and other fuels won't be hit as the industry has informed us that there won't be any shortage. Machinery parts and cartons used for packaging have been stopped or delayed. We are looking at alternative options from local vendors. We have also driven various awareness programmes through banners, leaflets, workshops, etc., to bring in safety as the utmost priority for the workers. The company has also initiated temperature checks and sanitisation at entry and punching areas. Hot water dispensers have been implemented in various areas. The employees are only following virtual interactions for customer and internal meetings. All the outgoing and incoming transportation is being carefully monitored to avoid any spread of the virus. We have given truck drivers proper awareness and information on the outbreak of the virus. Truck drivers are not allowed to enter without washing their hands. Hand sanitizers have been made available for the truck drivers and cleaners.
Tell us about some of the new innovations in the glass packaging solutions by AGI.
AGI has recently provided the following packaging solutions:
• Offering a new tempering method for strengthening glass containers.
• Creating a lightweight container in different geometric shapes.
• Using newer technologies like single-stage forming to produce thinner but stronger glass containers.
• Developing a coating on the surface of the glass to avoid strength loss.
• Creating heat-resistant pyrex glass.
• Creating internal embossing glass bottles.
Apart from that, in 2019, we invested in natural gas to curb carbon emission. We also installed machinery like end-of-the-line packaging for robotic case packer, case palletiser, cullet washing system, automated dry optical sorting system, etc.
How is AGI growth of glass industry with plastic phasing out by 2020?The demand for glass packaging is expected to grow exponentially by next year. AGI has already installed the additional capacity to meet the rising demand, and there is no shortage of glass. Narrow neck press and blow (NNPB) process can produce the best glass bottles, and the current trend is towards tempering, using appealing colours, and other value additions that will overcome the shortages and create a good supply chain to the consumer.
There won't be much cost involved as most of the pharma products till 2011 used glass, and hence switching back to glass is not a challenge. Already, stability data is available with all the pharma companies. The pharma companies that USFDA has already approved glass. With plastic phasing out in the next year, the demand for glass bottles is increasing substantially and even end consumers have started indicating a preference glass. An increase in the price of the glass bottles may be at regular intervals only with the increase in raw material costs. AGI has hence taken all this into due consideration. One of the initiatives is our retail segment Greendrop Glassware, which deals with B2C and e-commerce.
How's been the business for AGI in the last one year and what's driving the growth?
In 2019, AGI invested in natural gas to curb carbon emission. We also installed machinery like end-of-the-line packaging for robotic case packer, case palletiser, cullet washing system, automated dry optical sorting system, etc. This investment in new technology has brought in innovations.
What is the percentage ratio of your domestic and exports revenues?
The domestic market constitutes 90 per cent, and exports form 10 per cent of our revenues.
Tell us about the overall manufacturing capacities and capabilities of AGI.
AGI glaspac creates an environment where innovation, research and development, as well as best practices, are an integral part of the working culture. Besides, all the manufacturing tools like business excellence, TPM, and so on have been introduced in manufacturing. Our customers love to work with us due to our differentiators, which are as follows:
Diverse Product Range: We are equipped to manufacture five ml to 4000 ml of glass bottles in various shapes, sizes and colours.
Broad-based Expertise: From mould making, quartz mining to printing-applied-colour labelling, we have a broad range of expertise. We also have in-depth technical knowledge of batch houses, furnaces, production processes, cold-end inspection and product packaging, which enable us to manufacture technologically advanced and quality products.
Accelerated Response: We are capable of rapidly adapting to changing customer preferences, consistently offering customised products.
Operational Excellence: We adopt the principles of continuous improvement, robust batch planning, minimal wastage and quality control.
Robust R&D: Our research and development team is invested in improving our manufacturing process, using cost-effective alternative raw materials, developing new products and ensuring the highest quality standards.
Locational Advantage: The presence of our units close to our customers' filling locations results in substantial savings in logistical and freight costs.
Enriching Client Relationships: We have forged meaningful relationships with our institutional clients; many of them have been associated with us for decades.
Today, it has become very important for manufacturing organisations to be equally focused on sustainability. Tell us what is AGI is doing in this regard?
At AGI, sustainability is one of our key corporate values inspiring our employees every single day as they go about their work. We always strive hard to create sustainable value through our digital transformation efforts across industries and geographies. Some of our few initiatives are as follows:
Solar Power Facility: As a part of our sustainability strategy, we have added a renewable power source, solar energy, in our consumption portfolio. We have successfully installed a solar rooftop and ground-mounted solar power plant for 8.5 MW power capacity. The system is "On-Grid" and connected directly to our system. Annual estimated energy generation is 12,264 Mwh. These systems are future-ready and are gaining significant popularity as a viable means to reduce carbon emissions. The solar energy generation is not only contributing to green power generation but also helping us in rationalising the energy cost. We are planning to set up more 8MW power capacity of the facility shortly.
Waste Heat Recovery for Furnaces: At present, we use regenerators for waste heat recovery from the furnace. These generators potentially generate around 500 kW to 700 kW of electricity.
ESP to Reduce Emissions from Furnace: AGI's Electro Static Precipitator (ESP) is a filtration device that removes fine particles, like dust and smoke, from gas. It is designed to maintain Suspended Particulate Matter (SPM) concentration within permissible limits as specified by the State Pollution Control Boards.
Water Recycling Plant: Wastewater recycling helps us to minimise the environmental footprint. Recycling and reuse of the existing water and wastewater are critical to protect our precious resources for domestic, agriculture, commercial and industrial needs.
AGI's Natural Gas Supply Facility: AGI glaspac had made an agreement with Bhagyanagar Gas Limited and Gujarat State Petroleum Corporation for the supply of natural gas to Hyderabad and Bhongir, respectively. With these efforts, AGI is moving toward reducing the carbon footprint.
END
