China's largest plastic pipe maker, China Lesso Group Holdings Ltd., is investing $45 million in an extrusion and injection molding factory in India, to try to capture growth in that country's building markets.
The new facility will manufacture pipe and pipe fittings and extrude window profiles, targeting Indian markets like real estate and infrastructure, said Victor Lin, Lesso vice president, board member and head of the company's international operations.
“I think that the opportunity in India will be huge in future years, that is why we have this kind of investment,” said Lin, who also is president of the company's U.S. subsidiary, Lesso America Inc., in Corona, Calif.
Lesso, which is headquartered in Foshan, China, opened an injection molding plant in Corona in 2015. The India facility represents another step in Lesso's plan to globalize and broaden its product portfolio beyond pipes, which it first announced in 2013.
Lin did not provide details of the India investment, like the number of machines and employees, saying some of it was still being decided.
But the local economic development agency in India where the company is building the factory said on its Twitter account Jan. 5 that Lesso would be investing 300 crore Indian rupees ($45.13 million). The Maharashtra Industrial Development Corp. said the factory would be in Chakan, near the city of Pune.
Lin declined to say when the new factory would open but he said the company wants it operating “as soon as possible.”
He said there are strong local competitors in India, but he said Lesso believes it has advantages from 30 years of development in China. As well, he said Lesso's plastics machinery manufacturing unit sells equipment in India, giving the company familiarity with the market.
The factory will be built on 45 acres in Chakan that MIDC allocated to Lesso, and will be next to another 30-acre parcel for Chinese plastics materials maker Kingfa Science & Technology Co. Ltd.
Both properties are part of a larger piece of land that had earlier been pledged to Chinese truck maker Beiqi Foton Motor Co. Ltd., but Beiqi will be given other adjacent land, according to Indian press reports.
Lesso, which is publicly traded on the Hong Kong Stock Exchange, reported sales of $1.09 billion in the first six months of 2015.