Indian Label industry

Shoaib Akhter

Business Development Manager

INDIAN LABEL INDUSTRY

Country Overview

Industry Overview

Global

India

Labels

Market share

End User Segment shares

Recent Emerging Trends

SWOT Analysis

Opportunities- Label Industry

Challenges

India – At Advantage

INDIAN LABEL INDUSTRY1

India Growth Story –

2nd fastest growing economy in the world ( Value : US$ 1.43 trillion in

2010)

GDP > 8% over the past four years

India’s share in world GDP steadily increasing, expected to reach

6.28% in 2015

Reasons

High Investment in Infrastructure

Investment in capacity expansions

Policy Reforms


Huge middle class population (households with annual Incomes of US$4762 to US$23,810) grown from 25 million people in 1996 to 153 million people in 2010

Growing economy and rising literacy rate to result into a third of population (34%) to join middle class

Higher purchasing power to afford quality products due to increase in disposable income


GLOBAL

Industry Size :

In Value : US$ 73 Billion

In Sq Mtr : 42billion sqmtr

Growth Rate : 8%

No. of Converters : Around 30, 000

Expected Industry growth @ CAGR

10% over next 5 years globally.


INDIA

Industry Size :

In Value : US$ 0.5

Billion

In Sq Mtr: 1.0 billion

sqmtr

Growth Rate : 20%

Expected Industry growth @

CAGR 15-20% over next 5 years

in India

Current Market share of

Labels Industry : 3 % of

entire Packaging

Label, 3%

Flexible, 22%

Rigid Plastics,

18%

Printed Carton,

17%

Glass Bottles,

12%

Metal Can, 10%

Cap & Closures

, 6%

Others, 12%


Glue-applied labels,

57%

Pressure Sensitive

, 31%

Sleeve Labels,

6%

In mould Label,

1%

Others, 4%


*Textiles – including exports

3.70%

32.60%

17.60%

1.40%3.60%

4.20%

4.40%

32.50%

Pharma

Apparel & Textiles

Food & Beverage, Tobacco & otherFMCG

Jewellery, watches & gift articles

Automotive components, electricalappliances

Industrial Lubricants & Paints

Computer Labels, Floppy, CD, S/w

Others


Collaboration with International Companies and

consolidation

Shift from simple wet glue to more sophisticated product

as self adhesive labels and shrink sleeves

High end printing machines & pre - press equipments

Indian businessman willing to invest in latest

technologies



Higher GDP growth leading to higher disposable

income

Cost Competitiveness – large volume Players

Low cost, skilled, English speaking labour

Entrepreneurial family owned businesses with

strong appetite to grow

Strong Judiciary system


Fast growing Indian middle class- high disposable

income – driving demand

Increase in penetration in non metro markets

New market segment for specialised products

Investments and capacity expansion by MNCs

JV and alliances with Indian companies

Public private partnership for strengthening infrastructure

Low Margin Pressure

Inadequate investment in R & D – Limited technologies

Short term vision - lack of focus on exports

Poor all round infrastructure

Lack of data protection



Volatile Raw Material Cost

Global Competition from emerging economies

Trade Policy

Currency Fluctuation

Skilled labour shortage leading to attrition and wage

Inflation

Counterfeiting leading to loss in revenue

Rapid growth in disposable products

Increase in exports (Developing markets)

Growth in FDI & organized retail sector

Increased application in logistics & Transport sectors

GST implementation will lead to efficiency in economy and overhaul in supply chain

Growth in various sectors like -

Pharmaceuticals

FMCG

Food & Beverages

Liquor



Sector Products Companies / Products

PHARMA API/Bulk Drugs Numerous/ Drum Labels

GENERAL Agro Chemical/Con.

Chemical/Seeds

Numerous/Paper/ Filmic

DURABLES Glass – Float/Auto Numerous/ Filmic

DURABLES Engineering Goods Numerous/ Security

Label

FOOD Jam/Ketch Up/ Tinned

Food

Numerous/ Paper/ Filmic

BEVERAGES Health Drinks/ Milks/

Sharbat

Numerous/ Paper

HPC 2nd rung Personal Care

Products

Numerous/Paper/Filmic


Highly fragmented & disorganized Industry

Continuing high costs of key materials like substrate,

adhesives & chemicals

Environmental & Sustainability issues

Delay in reforms

Alternative label & decoration technology


WHAT INDIA CAN OFFER WHAT INDIA CAN GAIN

Low cost high volume player

Quality Consistency

Ability to add new plants at low

cost

Ability to absorb overseas

opportunities

Technology up gradation and R

& D for new products

Fast capacity expansion

Higher production efficiency

Access to better systems

Entry into International Market

17 INDIAN LABEL INDUSTRY