Business Research Methods

Sintex Industries L i m i t e d : Grooming w i t h Increased Demand of Plastic

Introduction: An Overview of the Plastic Industry

The use of plastic in various product manufacturing has provided a substantial base to plastic
industry for grooming. The automobile industry is one of the largest consumers of plastic, as
it is lightweight, resilient, and rust resistant and a good insulator. Earlier, plastic was used
only in decorative laminates, b u t now complete furniture and upholstery are being
substituted with plastic. The use of plastic has increased over the years in water and air
transport. Fiberglass boats are preferred on account of their light weight appearance, low
maintenance costs, and anti-corrosion. A plastic product provides safety, performance, and
value. Plastics have almost substituted glassware and crockery, used in making appliances
such as refrigerators, washing machines, televisions and computers. It has emerged as a key
element in modem pack aging, used in making artificial body parts such as artificial heart valves,
bones, and teeth. Polymers also play a significant role in textiles, with synthetic fibers in vogue
and used as substitutes to natural fibers such as cotton, wool, and silk.

Sintex Industries Ltd: A Pioneer in Plastic Industry

The Sintex group is one of the leading providers of plastics and niche textile-related products in
India. It caters to the Indian market and has a solid presence spanning nine countries across
four continents including countries such as France, Germany, and the USA. Sintex group’s
clients are scattered across the globe and most of them are parts of Fortune 500 companies list.
Established in India in 1931, Sintex has a proven track record of pioneering innovative concepts
in plastics and textile sec tors in India and an uninterrupted 77 years of dividend payment to its
shareholders. Continuous innovation is the foundation of Sintex’s success over the years.
"Active thinking" drives the company on its path. The innovative ideas are not only limited to
products but also implemented in the manufacturing process, markets, and management
policies.2 The company generates 45% of consolidated turnover from building materials such
as pre-fabs and monolithic; 40% comes from custom-moulded plastic composite products; and
the remaining 15% is attributed to textiles.3 The company is highly successful and witnessed a
steady increase in income, sales, and profit after tax 1997-1998 to 2007-2008 as can be seen
from Table 3.01. As evident from the table, Sintex industries limited never suffered from losses
in the last 11 years. Rather, it has shown tremendous growth rate during this time span. This
consistent performance is the foundation of company's overall excellence.
TABLE 3.01

Income, sales, and profit after tax of Sintex Industries limited from 1997-1998 to 2007-2008

Year Income Sales Profit after

(in million rupees) (in million Rs.) Tax (in million Rupees)
Mar-98 1839.9 1821.8 104
Mar-99 2227.8 2203.5 105.5
Mar-00 2445.4 2427 131.6
Mar-01 3320.8 3225.1 241.4
Mar-02 4216.1 4167.9 192.2
Mar-03 4981.9 4916.7 236.8
Mar-04 5946.1 5822.7 336.6
Mar-05 7294.9 7160.8 539.1
Mar-06 9437.8 9144.7 920.2
Mar-07 12,395 12,128 1305.8
Mar-08 18,348.5 17,902.9 2163.3
Source: Prowess (V. 3.1), Centre for Monitoring Indian Economy Pvt. Lid, Mumbai, accessed
September 2009, reprinted with permission.

Opportunities for Indian Plastic Industry

The Indian plastic industry is catalyzed by a surging demand in downstream industries such as
packaging, automobile, and retail on the one hand and an exponential increase in the middle-
class disposable incomes on the other. India 's plastic industry expects to capitalize on this
optimism through the realities such as a large and expanding domestic market, a burgeoning
consuming class with increasing purchasing power, delicensed and deregulated regime,
facilitating growth and investment, large processing industry base of more than 22,000 units
with the potential for another 40,000 units, low manpower costs, providing an export edge,
recent gas finds, enhancing feedstock security and environmental opportunities through
water security, energy conservation, and preservation of natural resources. India is the eighth
largest plastic consumer in the world with a per capita consumption of around 8 kg-far below
the global average of 20 kg. The consumption of recycled plastic constitutes approximately 30%
of the total off-take in the country. With the increasing demand in the domestic market, India is
expected to be the third largest consumer after the USA and China by 20 I 0 with an expected
consumption 12.5 million metric tons (MMT) (a projected compounded annual growth rate
(CAGR) of 15%), as against 38.9 MMT for the United States and 31.3 MMT for China. The
polymer demand in India will be largely dominated by polythene and polypropylene.

Sintex industries are ready to explore growth opportunities. A company that had a single plant
for building materials a couple of years ago, Sintex now has five plants for the building material
order supply. The company is also planning to enhance the capacity of these plants. Various
other measures such as acquisition and innovative product offering are also being taken by the
company to cater to the market needs.

Suppose the company wants to ascertain consumer attitude for its different brands, then

i) discuss various stages of the research to launch this research programme,

ii) Define the research problem,

iii) Discuss the type of the research design used for this research programme,

iv) What will be the nature of data for ascertaining consumer attitude?

v) Discuss the scaling techniques used to measure the consumer attitude, and

justify your selection of a particular scaling technique.