Century Plyboards India Ltd. expects its plywood business to double in the next four-to-five years, its Managing Director Sanjay Agarwal said.
The country's largest plywood maker received a licence to setup a new plant in Lucknow, Uttar Pradesh, Agarwal told BloombergQuint in an interaction.
This led to brokerage firm CLSA raising concerns about excess supply in the medium-density fibreboard market. “We see continuing supply glut in the MDF market in India even as the industry is in a high-growth phase benefiting from the undergoing shift from low-end plywood to MDF,” CLSA said in a report. “Given large new capacity additions announcements, we believe industry utilisation is unlikely to improve in the next few years.”
Agarwal, however, said that MDF is still an underpenetrated market in the country and that there is a huge opportunity to expand their footprint.
Watch the full interaction here:
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