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Raipur Plant to boost APAT’s margins through innovative product offerings

We visited the recently commissioned Raipur plant of APAT and interacted with some of the key personnel. The inception of the Raipur plant dates back to FY21, initiated by APL Apollo Building Products Pvt Ltd. (ABPL), a wholly owned subsidiary of APAT, located in Village Simga, Baloda bazar district in Chhattisgarh (almost 60 Km from Raipur Airport). Key aspects of this plant are:

* It is the largest plant for the company with an installed capacity of 1.2MTPA and scope to further expand by 0.1MTPA through debottlenecking

* It is strategically located in close proximity to raw material suppliers; additionally, this strategic location enables the company to serve multiple regions efficiently, given its Central position in India.

* The Raipur plant will manufacture only value-added products (VAP), which will drive up the overall margin profile for the company. Additionally, these plants will be manufacturing products, marking *he first production of its kind in both India and the world.

* The plant was recently commissioned and the production volume is rapidly increasing, with the target of achieving a quarterly run rate of 0.18-0.2MTPA by 4QFY24.

Key Characteristics of the Raipur Plant

* The Raipur plant is located at Village Simga, Baloda bazar district in Chhattisgarh and is spread across 450 acres (of which the covered area is ~200acres). The total capacity of the plant is ~1.2MTPA with further scope to expand by 0.1MTPA through debottlenecking.

* The plant is located in close proximity to the Raipur Airport (~60km) and its strategic positioning near the raw material source ensures a streamlined supply chain (~300km radius).

* The plant is divided into five sections: Hot Strip unit (HSU), wide flat division, tube division, narrow flat division, special pipe division. (refer exhibit: 4)

* The HSU, wide flat division and Narrow tube division have commenced productions with monthly capacity of 41,000MT/20,000MT/25,000MT, respectively. The narrow flat division (capacity 14,000MT per month) and special pipe division are currently under construction/erection.

Strategically positioned to maximize benefits

* APAT operates a network of 11 state-of-the-art manufacturing facilities strategically spread across the country. These facilities collectively offer a substantial total capacity of 3.6MTPA.

* The well-distributed manufacturing plants play a pivotal role in establishing the company's strong geographic presence, enabling it to be in close proximity to its customers. Additionally, this new Raipur plant has commenced operations with a capacity of 1.2MTPA, focusing exclusively on value-added products. This can be further expanded by 0.1MTPA with debottlenecking. 

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