Global alternative investment firm Investcorp has led an investment of Rs 340 crore (around $41 million) in paper-based packaging solutions Canpac Trends. The company said the “contemplated transaction” will also provide a partial exit to Canpac’s earlier investor JM Financial India Fund II. The latter had invested in Canpac in 2021.JM Financial acted as the exclusive financial advisor to Canpac and its selling shareholders.
Nilesh Todi, Founder, Canpac Trends, said, “This investment comes at a vital point in our growth journey as we continue to expand our presence across India. This funding round will enable us to scale up our manufacturing and sales capabilities.”
The company said it serves over 400 large and mid-sized companies in India and abroad. In 2023, Canpac set up Altpac to foray into the manufacture of paper bags for e-commerce and omni-channel retail and Sweetdisp to cater to the fast-growing chained QSR and food services sector.
The investment will be used to expand the company’s production footprint to all major manufacturing hubs of the country and to accelerate growth via acquisitions and strengthen its research and development initiatives, Investcorp said.
“While paper packaging market is over Rs 570 billion in India, the industry remains highly fragmented with an opportunity for leaders to consolidate. In this industry, Canpac has firmly established itself as a leader which is able to serve customers with superior standards of quality and safety,” said Anshuman Goenka, Partner, Investcorp.
Investcorp specializes in alternative investments across private equity, real estate, credit, absolute return strategies, GP stakes, infrastructure, and insurance asset management.
The packaging market in India is likely to reach $204.81 billion by 2025, registering a CAGR of 26.7 per cent from 2020 to 2025, according to the government’s Invest India portal. The fastest-growing packaging segments are laminates and flexible packaging, especially PET and woven sacks.
The industry comprises more than 900 paper units, with an installed capacity of nearly 30.73 MT. As of March 2023, around 553 mills are operational with a total operating capacity of around 25.61 MT, according to the Invest India portal.
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