SLMG Beverages, a prominent franchise bottler for Coca-Cola in India, is strategizing to establish a PET bottle recycling facility through a joint venture with Coca-Cola India and Maharashtra’s Dalmia Packaging, involving an investment ranging from INR 90 to 100 crore.
The recycling plant is expected to have the capacity to process 36,000 tonnes of food-grade plastic each year, while also producing 24,000 tonnes of PET bottles, representing 20% of its total sales output.
SN Ladhani, Chairman & Managing Director of SLMG Beverages, anticipates that within the next few years, the government will enforce regulations requiring all plastic product manufacturers to integrate recycled plastics into their production processes.
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He mentioned that while western countries utilize recycled plastic up to 50%, the company anticipates the usage to be around 30% in India.
He noted that previously, recycled plastic wasn’t used in food-grade products. However, there are now advanced technologies available in Germany, Japan, and the US to ensure that recycled plastic is as good as virgin plastic.
The primary hurdle in plastic recycling lies in the collection of discarded plastic bottles. SLMG is relying on its joint venture partner, Dalmia Packaging, to manage the sourcing of plastic for recycling, given its existing presence in that sector.
The company has already pinpointed the location between Lucknow and Kanpur for establishing the facility and is currently in the process of procuring the machinery.
“We sent a letter to the central government requesting the same concessions granted to recyclers in various industries.” “We expect to begin production in two years,” he stated.
In an effort to streamline operations and explore opportunities in the capital market within the next 2-3 years, SLMG has appointed Costin Mandrea, a seasoned Coca-Cola executive, as CEO.
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Operating seven plants with a daily bottling capacity of 41 crore units in Uttar Pradesh, SLMG caters to 90% of Coca-Cola bottle supply in the state. Additionally, it fulfills the entire demand for Coke in Uttarakhand and maintains a presence in Bihar and Madhya Pradesh.
It serves over 300 million people through its network of 1.5 million outlets and a distribution system comprising over 1,500 distributors across all four northern states.
Mandrea has devised plans to specialize each bottling plant in the production of a specific Coca-Cola beverage, aiming to enhance cost efficiency through the utilization of artificial intelligence in the transportation of finished goods.
