India's Label Markets

By Steve Katz | January 14, 2009

India, along with its rich history and culture, also has an emgerging and thriving label market.

The Taj Mahal
India is a fascinating place. Its landscapes are as diverse as its culture. A number of religions and traditions exist alongside each other, dating back thousands of years to the origins of Hinduism, the country's predominant faith and what it also generally regarded as the world's oldest organized religion. Modern India is a mix of tribalism, urban sophistication and technology. To a first-time visitor, getting from place to place in one of the country's urban centers can be a maddening, "white knuckle" experience, but that can also be interpreted as a solid indicator that there is quite a bit happening in this very much emerging nation.

India is the world's largest democracy, and this political distinction allows it to boast as having the world's largest free market economy, and one that is continuously growing. So, with that in mind, India's position in the label converting industry is one that deserves focus, as it emerges onto the global scene.

Evidence of its international relevance, as well as a great resource to learn about India's label market, was the India Label Show, held December 3-6, 2008, at the Pragati Maiden convention center in the nation's capital of New Delhi. The event was organized by the Tarsus Group. Launched in 2002, the India Label Show takes place every two years, yet this year's edition marked the first time it was part of the Tarsus Group's Labelexpo Global Series.

Literally days before the event, the city of Mumbai, India's economic hub, was rocked by the tragic terrorist attacks that killed and injured hundreds of people. However, with much resolve, the 2008 India Label Show went on as scheduled. In light of the tragic events, the show drew nearly 5,000 visitors who met with the more than 150 exhibitors and had the opportunity to participate in the educational program.

Survey says

Mike Fairley of Tarsus, chair of the conference sessions, kicked off the program by revealing the findings of a 2008 survey of 500 Indian label converters. The survey's findings point toward a range of trends in the market and, according to Fairley, "ever increasing growth." He says it's notable to point out that in the wake of the struggling global economy, India is in far better position to weather the global economic crisis. A big reason for this, he says, is because India is far less dependent on exports than other emerging markets, such as China, for example.

"I see long term potential for high growth for the next 10 years," Fairley says. "India is at the beginning of major retail growth. The industrial market is massively expanding and this has led to many small label companies being formed in India."

Survey results showed that in 2008, 49 percent of converters reported sales growth of 10 to 20 percent, and 25 percent of those reporting growth of more than 20 percent. Over 84 percent of converters are printing self-adhesive labels, which is significant considering that PSA versus wet-glue labels was a major topic of conversation among the show's exhibitors and attendees.

The survey also pointed to several hundred new presses recently installed, a significant growth indicator.

Cristina Toffolo, sales director for Italian press manufacturer GIDUE, spoke in the conference theater on the subject of GIDUE's Indian press installations and its R&D program designed specifically for the Indian market. She stated that the company has recently completed 11 press installations in India and is working diligently in the training of Indian engineers for installation and service.

The Gallus booth consistently drew large crowds while demonstrating the Gallus EM 280 servo press.
Gallus, a Switzerland based press manufacturer, is another company that is reporting success with its Indian press installations. According to Samir Patkar, business head, web converting and consumables for Heidelberg India (Gallus' partner), in the past seven years Gallus has installed 33 presses, and two are currently in production. In addition, the company sold an EM 280 servo press at the India Label Show, bringing its total to 36 press sales in India.

"The labeling industry in India is overcoming challenges of availability of good equipment, consumables, process know how, and workflow systems. Indian label printers are now winning international label awards organized by governing bodies like FINAT and AFTA. The message is clear – the benchmark has been raised and the label industry in India is geared to take on global challenges head on," Patkar says.

Nilpeter's Jakob Landberg joins Bollywood star Mandira Bedi in presenting an award at the 2008 Indian Label Awards show.
On the first evening of the show, the Labels Group organized the Indian Label Awards 2008 on behalf of the Label Manufacturers Association of India (LMAI). At the gala evening, which had 650 attendees, the best Indian printers and converters were recognized and awarded for their excellence and contributions to the advancement of the Indian label industry. LMAI President Manish Desai, who is also the managing director of Mudrika Labels, was joined on the stage by Mandira Bedi, a Bollywood star who orchestrated the evening of award presentations and entertainment. Raj Srivinasan, managing director of Avery Dennison India, said he was honored to be involved in the LMAI awards and pledged full commitment to the growth and development of the label industry in India.

Trends revealed

While the label industry's growth is taking place across the board throughout India, there is one area in particular that appears to have the best potential for growth – brand protection and anti-counterfeiting. In fact, day two of the event featured a full conference program with a panel of experts dedicated to the topic. Moderator Mike Fairley said it was the most well attended of all the conference sessions.

Among the topics discussed was the global impact of counterfeiting. Some of the figures revealed: Global lost revenues due to counterfeiting are now approaching $US1.4 billion per year – or about 7 to 8 percent of world trade. More than 200,000 jobs are lost worldwide each year because of counterfeiting. In addition, hundreds of people die or are injured each year through using counterfeit products.

The list of the most commonly counterfeited products is rather long, and it seems there are few products immune to the crime. Fairley pointed out how organized, professional, and well financed the counterfeiters are. The panel suggested defenses for converters include making unique, one-of-a-kind labels, changing solutions on a frequent basis, and using multiple anti-counterfeiting strategies at the same time. An example was provided that included overt, covert, and a track-and-trace bar code simultaneously. The various security substrate, ink, design, and converting technologies were also discussed.

As a whole, brand protection and ant-counterfeiting is booming in India. While there are a number of products that use this technology, in India, healthcare and pharmaceutical labeling in particular appear to be the market segments benefiting the most from India's anti-counterfeiting boom.

A recent Times of India news story revealed just how serious pharmaceutical counterfeiting in India is. The newspaper cited estimates that suggest between 5 and 20 percent of the medicine sold in the country is fake. Not only that, the problem appears global as the Organization for Economic Cooperation and Development (OECD) says 75 percent of fake drugs around the world have origins in India, according to the Times.

India is striving to be on par with the rest of the industrial world, and meeting global standards is a key factor for this. The Hindu Business Line reports that the Indian government, which regulates domestic drug prices, may start offering a premium to companies that have at least one factory approved by foreign inspectors. If legislation like this comes to pass, it could be beneficial to the pharmaceutical sector of the labeling industry.

Exhibitioners by and large echoed Fairley's consensus that brand protection and anti-counterfeiting is the major labeling trend in India.

The Holoflex booth at the India Label Show
"The new label companies in India are focusing on brand protection," says Prashant Mulasi, business development manager for Kolkata based Holoflex Limited, a manufacturer of security holograms. The company specializes in brand protection and refers to this segment of the Indian label market as a "war zone." Mulasi says the company is at the front lines of the "war on counterfeiters." Holoflex provides its security products to various government departments and corporations in India and over 30 countries worldwide. The company is also the founding member of the Hologram Manufacturers Association of India (HoMAI).

"This niche of the market is absolutely growing. Our customers are from pharmaceuticals, music and software, personal care, and FMCGs (fast moving consumer goods). Software piracy is big business for the counterfeiters, and one of the most ripped-off items. Piracy in the music industry is also very big. The music industry alone suffered $US300 million in losses last year. It's so important to stay innovative. At Holoflex, we make sure we're one step ahead of the competition and three steps ahead of the criminals," Mulasi says, adding, "We offer 'total security.' Measures vary from holograms with variable information like alphanumeric sequential numbering to tamper evident holograms that have a built in self-destructive system. The goal is to deter counterfeiters from cloning your brand while protecting your market share," Mulasi says.

Stefan Krebs of Erhardt + Leimer (E+L), a Germany-based global manufacturer of inspection equipment, points out that the push to security and brand protection technology has really been helpful in regard to E+L's products' increase in popularity in India.

"Pharmaceutical manufacturers in India now have the same global standards as anywhere else in the world. And because of this, we've been as successful here as we are anywhere else. Even with the recession, there will always be a need for medicines."

E+L used the India Label Show as a springboard to promote its Nyscan Tubelight 100 percent inspection system. The TubeLight is fully integrated, providing the illumination for difficult webs such as embossed metalized surfaces. The system can cover a wide speed range, depending on the pixel resolution used. The 100 percent inspection system will find defects such as broken or missing characters, misregistration, color deviations, and splashes. Krebs says, "People are working with quite a bit of foil in India, which makes the Tubelight an ideal choice. It's our number one seller in India."

Printing processes

While brand protection and anti-counterfeiting is certainly a hot topic in India's label market, there are other notable trends. The aforementioned survey of label converters revealed the printing processes being used, and which ones are on the rise. The survey's findings conclude that 55 percent of India's label printers use a screen printing process, 50 percent flexography, 35 percent offset, and 30 percent letterpress. Fairley noted that seemingly "coming out of nowhere" is the use of UV flexo, which is reported to be in use among 27 percent of the converters surveyed.

Chinmay Samanta of Inkstream, a West Bengal based producer of water based flexo printing inks in India, talked about some of the emerging trends in India's label market. "In the narrow web market, I'd estimate that 80 percent of the inks used are water based and 20 percent are UV, but this is changing. UV is definitely on the rise and we're seeing a lot of movement in the industry from water based to UV, as it seems the latest press installations are coming with UV attachments," he says.

"Flexo is most definitely on the rise," Samanta says. "Offset printers are moving to flexo. The reason for this is because flexo is so much faster. What an offset press does in seven days, flexo can do in a day. Suppliers are approaching offset printers and telling them about the virtues of flexo, with a focus on turnaround time."

The Inkstream crew at the 2008 India Label Show
Samanta also emphasizes cost as a potential factor for trends to shift from one technology to the next. Acknowledging the movement toward UV inks, he says, "Consumer goods in particular are going to UV. Liquor and wine are still using water based inks because of cost. It's cheaper, and there are no energy costs to consider like there is with UV. Water based ink will always have its place in the market.
Considering today's economy, cost is such an important factor. We've been seeing movement from wet glue to PSA from many of the big brands, but wet glue is so much cheaper, and because of this, some people are now going back to wet glue," Samanta says.

Kishore Nawar, market manager for Tesa Tapes (I) Pvt. Ltd., also reported a high degree of interest in its UV inks from Indian converters. The company was featuring its Tesa UV strips, which are used to determine the UV dosage required for proper curing. Nawar says the strips are self-adhering, flexible and paper thin, and the show marks its introduction to the Indian label market.

"Many people are inquiring about our UV strips. It's really a big thing for us, and feedback has been fantastic. UV flexo usage is definitely on the rise here in India," Nawar says.

While press sales often get the headlines, other types of equipment manufacturers are also reporting success and continued optimism in India. David Ho, general manager, Asia Pacific, for Martin Automatic, a US based manufacturer of automatic splicing unwinds, automatic transfer rewinds and tension control systems, says the company has sold four of its MBS automatic butt splicers in the past six months, and attributes its recent success to the market's growth.

"There are a lot of newcomers here in India, people who are getting into the label business for the first time. The market is growing so fast, and with all these new players, we could even see some overcapacity very soon. This is a good thing," Ho says. "We're selling the MBS here in India, but we're also getting a lot of interest in our 'new babies,' the STS automatic splicer and out STR turret rewind.


Some exhibitors and attendees cited India's infrastrucure as a significant hurdle to overcome. They talked about problems with on-time deliveries of equipment and supplies, and if you've traveled through the country's urban areas during rush hours, you know what they're talking about. The conference sessions at the India Label Show also provided a great sounding board for Indian converters to discuss the challenges they face. The session titled "Facing Market Challenges and Consolidating Your Business" was one such session.

The consensus among the four participants of the panel discussion, all of whom are Indian label printers, was that issues involving pricing are of paramount importance. One issue brought to their attention was the rising costs of consumables, and how to go about relaying the price increases to customers.

Aditya Chadha, director of marketing for Update Print, suggests communicating to customers just what's going on in the marketplace. He says, "You have to tell your customers the facts about rising costs, and once you do that, then you can negotiate."

Vivek Kapur, director of Creative Label, discussed what he sees as pricing challenges specific to a company like his, one of the many start-up companies in India. "Transparency is important. Sometimes there are hidden costs that our customers don't see and we need to be clear with them. The end user needs to come to appreciate the value of the machinery that we're converting with."

Education was a focus of one panelist. "Looking at the pricing challenges we face, we have to educate the customer about pricing," notes Manish Desai of Mudrika Labels. "How do you sell self-adhesive against wet glue? Wet glue primarily uses paper, and a standard adhesive. There are so many different options for pressure sensitive labels – inks, coatings, substrates, special effects, and so on. Customers need to be able to differentiate and understand the value of the products, and the materials used to convert them."

Toward the end of 2008, India made headlines. Sadly, it wasn't because of the country's growing economy, industrial markets, or technological breakthroughs. However, this country is on the rise, and evidence of this is can certainly be seen in the label industry. The 2008 India Label Show also demonstrated the resolve of India's spirit.

Raj Srinivasan, managing director, Roll Materials India, Avery Dennison, perhaps summed it up best: "The success of this year's India Label Show 2008, especially following the tragic events in Mumbai, is testimony to the commitment and dedication of the labeling industry. By coming together in New Delhi to exchange ideas and explore new technologies, the printing and packaging sector has shown that it is committed to continued high growth."
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