The pandemic had wreaked havoc on most businesses and caused a dip in the fortunes of a few businesses in the industry. Though demand was fluctuating during this time, DIC continued in its efforts to deliver on commitments to the shareholders through income growth. As we were doing this, we also realised that we have a commitment to our society. So, we engaged in meaningful CSR programmes. As a part of this, we identified two areas we cared about: education and health.

As a part of the education outreach programme – Deeksha and Disha, we are working with girls and women from underprivileged families who have been brought under our wings to be guided and groomed for a successful future with quality education and thorough hands-on vocational training. Through Saksham, DIC India donated an ambulance to help the community around the upcoming plant in Sakhya (in Gujarat) to have better access to medical facilities faster and with ease.

We have been the only player in our industry who has been openly publishing our sustainability scores. While doing so, we share how we are reducing carbon dioxide emissions, waste generation and water consumption.

What’s clearly stood out for us is commitment to investing in people and processes. Additionally, the support of the parent company has been very good. I think that the last two years have strengthened DIC as a company in India.
Supply-side dynamics

Over the past two to three months, the world has opened cautiously, particularly after China had closed its borders in the early part of the year. In this light, getting supplies has also started to become smoother. However, rupee depreciation vs dollar, and challenges in Europe continue to remain a concern.  As DIC Group, we have integrated a bulk of our buying and as a result we are able to have access to supplies relatively better, though I don’t think we are back to the kind of supply chain comfort we had pre-Covid, yet.

For the kind of business we do, we often supply to customers where we are directly accountable for between 80% and 100% of their demand. So, that brings a big responsibility on DIC because the last thing one needs is impacted operations due to supply disruptions. I don’t recollect an incident in the past two to three years, where customers relying on us for service had to stop operations due to non-supply. With inflation, you also get stretched on your working capital. So, what we have done, since early 2019, is that we started investing strongly in demand planning, and fulfillment and automation. This process was initiated before the lockdown and was enforced due to Covid.

Building a strong ecosystem with our customers and partners has helped in keeping the business running for a long time

There is also a softer aspect of this entire inventory planning which is how strongly are you aligned with your customer? Do you have ears on the ground to understand what the customer’s order booking process is like? Are you able to use those data points into your analytics system to get your demand, other inventory planning?

We have invested in state-of-the-art analytical tools to ensure improvement in planning and fulfilment process which has helped us maintain our working capital within the boundaries without impacting the customer requirements. On reflection, if we had not done those two to three initiatives in early 2019, we would not have been achieving this degree of success.

Tracking variables
If I go back a decade in the industry, I think the demand had a certain standard pattern around it. What’s happened now is that there are a multitude of variables. There are different Go to Market channels, emergence of omni-business models, segmented customer base and intense competition for the share of mind of the consumer, who by virtue of being connected has information on the fingertips.

The packaging industry in India is at crossroads. The brands must address the Indian ethos, in terms of price points, products etc, without compromising their commitment to society and environment. Most brands, be Indian or global have clear emerging sustainability guidelines, which may not be legislation dependent.

India is a young country and I see an increasing trend from the younger generation, who are looking at accessing sustainable products. Similarly, there is increased awareness of health, especially in the past few years. Even if you are not an MNC that is focusing on ESG, you might have your customer talking about sustainable products. This has triggered, by default, a need for everyone to look up to what’s likely to happen.

An excellent example is expansion of Electric Vehicles in India, a phenomenon which was not even under discussion 2-3 years ago. I see dissimilar disruption in thought coming to our industry in the next decade. There would be the few gospel truths which will remain like a drive towards lower gsm in flexible packaging and a drive to reduce solvent consumption. Similarly, there will be an increased shift towards toluene free Inks in flexible, water-based solutions, mineral oil free inks in corrugated packaging and so on.

DIC India is already future ready with an expansive portfolio of global products “fit for India” in its repertoire to address these emerging needs.

Vision 2030
Recently the Vision 2030 was published by DIC Corporation which everyone can access online. We clearly say that globally; we will move 60% of our portfolio in a finite time frame to sustainable products. And to do that, you can assume that when a company makes a public declaration, they must have robust plans to address it. And that’s something which is happening globally. Even in India, we have been actively working on technologies which address some of these challenges.

We have a strong manufacturing and R&D footprint in India. India is a regional technical centre for the DIC P&G group. We have Indian and Japanese colleagues working together with our European labs to develop new products. We have the widest manufacturing footprint in the industry in India, which is allowing us to bring these technologies together. We are actively developing products for global consumption in India, as well as introducing them for our Indian customers.

How to use IT in a smart way
However, as we build an analytics ecosystem, it is also important that we should know what data we need and are clear about their analytics goals which are routed in corporate strategy and deployment roadmap. This holds true for a large company or an MSME.

The ban on toluene-free food inks was announced a few years ago. I am proud of our technology team who have mapped every aspect of usage variables and now we have four series of the toluene-free food inks which address the widest possible spectrum of needs of our converter partners. These developments have helped us engage and strengthen our Industry relationships as we focus on delivering improved “value in use” to our customers.

The recent single use plastic ban has triggered an additional set of challenges for the industry. I am happy to share DIC, with its global range of barrier coatings from our group company Sun Chemical is already having a wide range of solutions to address brand owner needs.

Toluene-free inks
Once the toluene ban happened, we introduced a series of toluene-free inks. These inks work on various environments and substrates, and ambient conditions. Some people would like to move beyond toluene-free to toluene-free and ketone-free.

India is also having a sizable export market on packaging and some of the large converters we work with use our toluene-free, ketone-free inks. We have addressed and analysed the need in India based on Indian water conditions and environment and introduced a modified but equally capable performing high performing water-based gravure. This addresses the needs for more sustainable solutions.

DIC R&D Centre

Being a sustainable business
Sustainability has become the buzzword. DIC has clear parameters and sustainability plans. As a group, we are looking at having carbon neutrality by 2050 and a 50% reduction by 2030. In DIC India, over the last 10 years, we have brought down our carbon emissions by a third. So, we are committed to achieving our global guidelines and for us sustainability goes beyond carbon emissions. We are also looking at elements like waste management and water conservation. We believe all these parameters are critical for us to deliver our sustainability initiatives.

Most of these fall under what we call as under scope one for now. DIC India is also actively working on developing the supply chain, which has supply partners committed to the ethos of sustainability. This means that tomorrow a large brand owner would like to work towards getting the products from a plant which is sustainable or the supply chain, which is committed to sustainability practice, we at DIC will be able to provide the traceability.
Our sustainability approach has a wide spectrum and addresses how we operate in our processes and in the way we are going to look at our raw materials, manufacturing, and supply chain.

Solvent varieties
Broadly speaking, the water-based flexible packaging inks sector is very miniscule now. I think they would be less than five per cent of the market. The toluene-free ink is close to 15% to 18% and fast expanding. So that’s a heartening sign.

With regards to the solvent element, its reduction has also had to do with an interesting factor, which one might miss out on. Solvent recovery and recycling are becoming a norm in Europe, and it is being adopted by a few other countries as well. In our main plant at DIC, we have come up with a solvent recovery plant and have invested in the solvent recovery process.

Here, we use the recovered solvent for a captive consumption which overall reduces our commitment of what we buy.

The message and the support to our converters is that when you partner with us you are assured of our sustainability committment.

When, let’s say, one of our brand owners works with a large converter and he says, “I would like to see scope two or scope three reduction coming from you” or that you and your partner should be focused on sustainability, they can be very well assured that when they are partnering with DIC. The company has its own published scores that are showcased as a part of our annual report, which shows our strong commitment to sustainability. As we move through the decade, these factors will have a strong meaning. So that’s how it would be in our contribution to the industry.

When a few fire accidents with few converters happened during operations restart after the first wave of Covid in 2020, we had organised safety programmes as an outreach to the industry for safety operations to enable our fellow manufacturers and converters to run safe operations. Of late, we have had inquiries from a few of our partners who asked if we can help them look at their processes and address their solvent wastages to make their operations safe; and it would be useful if we can you look at the total operations and bring our insights and knowledge into it. This is something we have been doing for a while.

Aqua Smart

Technical workings
The DIC technical centre in India has close to 80 scientists working on many aspects. We also have a lot of colleagues in specific technologies that have come from a group to work on various aspects and not just formulations. So, in India and globally as well, training young Indian scientists on becoming potential solution providers is important. Young scientists are now travelling abroad for learning and experience, and we have people coming from Japan coming to India to help us improve our product portfolio.

We have been working on several projects here including introducing toluene-free and advanced versions of toluene- free, ketone-free inks, water-based inks.

As I mentioned earlier, India has multiple challenges due to its vast climatic conditions and extensive profile of brands (and their needs). We have converters with machine speeds that range from 150 m/s to 500 m/s in flexible packaging, some have temperature-controlled presses, and most have presses which have humidity and temperature ranges which can be in extremes. The brand jobs can also be very diverse. Even in paper packaging, our needs are quite diverse, from basic single colour printing to rich gold and silver which gives the brand a
vibrant shelf throw.

In flexible packaging, we now have multiple variants of solutions like toluene-free inks, high strength and medium strength and water-based solutions for specific needs. In paper packaging too, we have a very wide range of UV Inks and varnishes and special colour solutions which allow all kinds of print job requirements to be addressed.

Today, a converter need not go for a “one size fits all” solution.

In the last three years, we have looked at the variance of various combinations available in the market in terms of usage using our global platforms to align solutions with Indian specific requirements without losing essence of our global product stewardship guidelines. But we do
work on modifying the technologies to address the local needs.

Our strength also lies in the fact that we manufacture our own resin, with global technologies, at our Bengaluru plant. This allows us to have a lot of latitude in the way we would like to experiment and produce products.

The  India growth story
DIC has a very strong commitment to governance. We have a wide experience from within the DIC group and external independent directors. What they bring to us is a very rich diverse experience because some of them sit on different boards. The common message we get from them is that we all believe in the India growth story.

We also believe that a lot of industries are today at an inflection point where what worked in the last 10 years might not work in the next 10 years. So, it is important to keep your ears closer to the customer, invest in technologies which improve productivity and bring solutions that are globally relevant.

Often there is a thinking that India may be a bit behind other countries in terms of technology evolution or for that matter per capita consumption is lower. Even if there are 10% of Indians who are ahead of the curve, you know it’s sizable and bigger than a lot of countries.

The future
I think the Indian economy, despite all the global hiccups, is on the recovery. Honestly, I see growth in both food and non-food segments. From our side, we are seeing that the end user consumption in both food and non-food segments are growing. This should occur well for all sections of packaging as well.

I’m also seeing a strong and robust revival demand in the publication inks. So, you know people talk about packaging. I think publications have also rebounded. While the growth numbers may vary, I think that most segments will see a decent amount of growth.

We are living in exciting times. So as an industry, things have their own ups and downs, but I am quite optimistic for the outlook going ahead.