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Regional expansion
The Project will be located in Krasnodar region which has only 4% of the glass container production capacity in Russia. From its output the Company will supply the Black Sea and Caucaucus regions of Russia. These regions are characterised by large populations and significant demand for beverages and containers but lack an adequate glass bottling capacity.
Competition
Krasnodar has a close proximity to a large number of regional clients that are active in the beer, wine and mineral water sector. The Sponsor is promoting NNPB bottles which require 20% less raw materials for production, are less prone to breakages, and are suitable for a faster production cycle.
Contribution to upstream linkages
The development of upstream linkages will be achieved among the raw material suppliers through the increased procurement needs. This will create the need for capacity increases for producers of raw materials such as soda ash and sand processing. The Sponsor will cooperate actively with suppliers to provide necessary guidance, training and know-how to ensure high quality materials are procured from local suppliers.
Contribution to downstream linkages
From the customers’ viewpoint, higher and more consistent quality items, product development and innovations will be the likely benefits from the Group’s involvement. The new investment in Krasnodar Region aims to meet both increasing demand for glass packaging from the developing wine sector, which is growing at an annual rate of 10-15% and is highly concentrated in Krasnodar. The Krasnodar plant is planned to meet the high demand for good quality bottles required by the Russian mineral water sector, which is largely concentrated in the South of Russia.
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