Hindalco to close down Kalwa plant near Mumbai

The Aditya Birla group's flagship company Hindalco Industries Ltd, has decided to shut down its aluminium foil plant at Kawla near Mumbai, due to what it called `economical un-viability' of running the unit.

Around 300 employees of the 45-year-old plant have opted for voluntary retirement scheme （VRS）. The company is yet to decide on what can be done with the land. “We have successfully completed restructuring at the Kalwa plant. It was not a successful unit. Knowing the fate of the factory 100 per cent of the employees opted for VRS. We will move the operations elsewhere,” said Debu Bhattacharya, managing director, Hindalco Industries Ltd.

The company has already disbursed VRS payment of Rs 22 crore. Bhattacharya declined to quantify the land area and the immediate plans for the site. As per the company’s website, the Kalwa facility boasts of 74 management staff including experts in printing technology. The factory’s residential colony comprises 58 staff quarters and a club house.

With an annual capacity of 6,000 tonnes this foil plant catered to the packaging needs of pharmaceutical, processed food, personal healthcare and confectionery industries among others. This factory produced bare foil, printed foils and printed multiple laminated products.

“We are not getting out of the business, we are only relocating. It was an old factory and the power cost was high. We could not run it viably. The operations were not big enough and we wanted to restructure it. We have some options to move to our other locations, but the plans are still at a formative stage,” Bhattacharya added. He went on to add that though the plans had not been finalised as yet, the firm was looking at using the premises as a global sourcing base for foil-related products for their other ventures.

Kalwa in Thane is only 35 kms away from Mumbai and many companies with factories in this region are shutting them down to convert factory land into prime real estate. Whether, Hindalco would do the same in not known. Meanwhile, Hindalco is pursuing its aggressive growth plans, to remain profitable and expand in India and the global market. Bhattacharya said that in India, the company is currently implementing capital investment plans worth Rs 23,000 crore, both in green field and brown field projects. These include the Rs 9,200 crore Mahan Aluminium project in Madhya Pradesh, the Rs 5,600 crore Utkal Alumina plant in Odisha. Work at these sites is progressing as per schedule and both the plants would be operational in the second quarter of 2012.

Bhattacharya said that the Aditya Aluminium and Alumina refinery project in Odisha and the aluminium project in Jharkhand are under different stages of implementation and are to get the necessary clearances.

The company is also strengthening the operations of Novelis, which it acquired a few years ago in the US. “The turnaround at Novelis is substantial. It is backed by solid shipments, exceptional cost control and improved high margin product mix,” said Bhattacharya, adding that the Aditya Birla group is investing $300 million （Rs 1,320 crore） in Brazil, to enable Novelis to cater to the South American market.