Uflex set to launch US plant; stock rises over 3 per cent

Packaging film major Uflex is all set to launch a PET film plant in Kentucky, USA. Sources close to the development have indicated that the company will invest $80-85 mn in the plant and a formal announcement can be expected in 3-4 months. The plant would produce 30,000 MTPA of PET film and the company is currently in talks with local government for land acquisition. Sources indicate the plant is expected to be fully operational by December 2012 and will contribute $20-22 mn per annum of EBITDA.

At 12:00 pm, shares of Uflex were trading 3.16 per cent up at Rs 134 on the Bombay Stock Exchange. It hit an intraday high of 134.95 and a low of 130.35.

As per sources, the plant will be financed by a mix of debt as well as internal accruals and the company is looking to raise $48-50 mn from two German banks, KfW and KBC. The financing is expected to be tied-up by September-October 2011. Kentucky production will primarily cater to clients in Eastern and Central USA.

The company had recently announced a 35,000 MTPA BOPET plant in Poland which would be operational by June’12. Additionally, in a recent interaction, R.K. Jain, CFO, Uflex had indicated that he is confident of clocking in revenues of over $1bn in FY12 and expects volume growth of 25% pa over next 3 years.