PRE-FEASIBLITY REPORT

FOR

THE PROPOSED CAPTIVE RESIN PLANT

AT

ROUTHU SURAMALA VILLAGE, THOTTAMBEDU MANDAL,

CHITTOOR DISTRICT, ANDHRA PRADESH

Submitted to:

Ministry of Environment, Forests and Climate Change

New Delhi

Project Proponent:

GREENPLY INDUSTRIES LIMITED

3rd Floor, Plot # 68

Sector # 44

Gurgaon – 122 003, Haryana

August, 2016

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1.0 Executive Summary

Greenply Industries Limited (GIL) is India’s largest Interior Infrastructure Company with

interests in manufacturing of Plywood & Decorative Plywood, Medium and High Density

Fiberboards (MDF/HDF), High Pressure Laminates, Particle Boards (PB), Decorative

Veneers and Flush Doors, operating 5 manufacturing facilities in the states of Uttarakhand (2

Plants), West Bengal, Gujarat and Nagaland.

GIL has decided to set up a state of the art composite plant with cutting edge technology for

manufacturing MDF Board in the State of Andhra Pradesh with capacities of 1200 CBM/ day.

The manufacturing process would require Formaldehyde based Resins. Therefore the

company is planning to set up captive plants for Resin Production (100000 Tons/Annum).

GIL has purchased land of 196.21 Acres at Survey No 97/1, 98 & 99 at Routhu Suramala

Village, Chittoor District, Andhra Pradesh and has converted it for Industrial use. The total

estimated Project investment will be Rs 758 Crore.

The manufacturing of MDF Board does not require Environmental Clearance (EC) from

MoEFCC. Hence, GIL has applied for Consent to Establish (CFE) for MDF plant to Andhra

Pradesh Pollution Control Board (APPCB) and has obtained CFE vide Order No. CTR –

039/PCB/ZOK/CFE/2016 dated 04.05.2016. Subsequently, in view of market scenario of

resin, particularly assured supply of desired quantity and quality, required to meet quality

production as well as better control over the process, GIL proposed to establish resin plant as

an interlinked project. The resin plant require EC under 5 (f) [Category A] as per Notification

SO. 1533 dated 14/9/2006 issued by MoEFCC.

There is a national initiative to protect and increase India’s Green Cover year on year.

Therefore the stellar economic growth of India has to be environment friendly and

sustainable. As Indian GDP grows at an estimated 6% during 2013-14 and at a higher % then

onwards, the wood based panel demand will grow exponentially. India, as a country needs to

make a paradigm shift in the kind of the wood panel products it uses and the fundamental

objective of the shift should be to place minimum burden on the National Green Cover. The

developed economies have moved from the traditional inefficient wood panels to MDF over

the past decades and India has a long catch up to do in coming years. China, a similar fast

growth developing economy has embraced MDF and dramatically increased their MDF

Production to 37 Million CBM against India’s 0.7 Million CBM in year 2011. It is

imperative that India increases its MDF production and substitute the inefficient wood panels

with wood efficient MDF Panels, thereby ensuring sustainable economic development.

The wood species to be used in the proposed integrated Plants are grown in land owned by

farmers and provide a direct source of income to them. The State Forest department and the

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Forest Development Corporation of Andhra Pradesh (APFDC) also engage in plantation,

harvesting, and selling of these species as it provides a useful utilization of wasteland, as well

as valuable income to the state and the community. The Indian wood species that would be

used are Eucalyptus, Subabul, Casuarina, Prosopis, Acacia and Poplar. Since these species

have a very fast growth cycle, and with various clonal development have become better both

in terms of quality and yield, the raw material from planting is available in 3-4 years. These

species are readily available in Andhra Pradesh/neighboring States, with sizeable plantation

activities ongoing and thereby posing no threat to deforestation. The fact that raw material

will be sourced through farmers, and that too without debarking, would result in the farmers

being encouraged towards further plantations. No timber naturally grown in the forest

would be used.

With the production of MDF, GIL would be able to substitute the demand of Plywood in the

country, which creates strain on the environment, as Plywood requires prime forest timber for

production. A substantial part of India’s demand for MDF is met through Imports. This

results in a large outflow of foreign currency. The estimated installed capacity of GIL’s

proposed plant will substantially increase India’s existing capacity to produce MDF, and will

result in substituting foreign products with domestic production. This will result in saving

India’s foreign exchange reserves. Exports from the Plant will also result in additional foreign

exchange inflow.

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2.0 Introduction of the Project/Background Information

2.1 Identification of the Project Proponent

Greenply Industries Limited (GIL) is India’s largest Interior Infrastructure Company with

interests in manufacturing of Plywood & Decorative Plywood, Medium and High Density

Fiberboards (MDF/HDF), High Pressure Laminates, Particle Boards (PB), Decorative

Veneers and Flush Doors. The company currently operates 5 manufacturing facilities in the

states of Uttarakhand (2 Plants), West Bengal, Gujarat and Nagaland. The product portfolio is

divided strategically between the factories, based on raw material availability as well as

market locations. The company markets its products through a grid of more than 40 marketing

offices around the country and has a network of more than 13,000 Channel Partners across 19

States. Greenply currently employs more 4,500 People across the country and is listed both on

the National Stock Exchange and Mumbai Stock Exchange.

2.2 Identification of the Project and Brief description of the nature of Project

The company has already set up Plants for manufacturing of MDF/HDF with a capacity of

600 CBM/day in the state of Uttarakhand. The MDF/HDF board manufacturing plant is a

State-of-the-Art plant equipped with a fully automatic continuous press and was set up in

2010 with an Investment of Rs. 255 Crore. It has introduced a number of innovative

technologies and processes resulting in conservation of natural resource particularly wood and

energy. The existing MDF Plant in Uttarakhand has played a key role in providing a valuable

alternative to the use of timber from natural forest and thus, has greatly helped in reducing

pressure on natural forest.

In accordance with the long term Company policy, it has been decided to set up a state of the

art composite plant with cutting edge technology for manufacturing MDF in the state of

Andhra Pradesh. The manufacturing process would require Formaldehyde based Resins.

Therefore the company would also set up captive plants for Resin Production.

The investment for the integrated plant would be to the tune of Rs 758 Crores approximately

where a manufacturing facility to produce MDF Boards, and a captive Resin Production

facility would be set up. The capacity of the MDF plant would be around 1200 CBM per day

for which CFE is already granted by APPCB, whereas the resin production would be 100000

per annum, having approximate investment 13.75 Crores for which application is being

submitted.

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2.3 Need of the Project and its Importance to the Country and or Region

The integrated MDF project will be single largest investment ever made in the industry of

wood based panels in India. With the production of MDF the company will be able to

substitute demand of plywood in the country, which creates strain on the environment, as that

needs prime forest timber for production. MDF boards are also much more environmentally

friendly products as the utilization of raw material to produce MDF is up to 95% without

considering moisture, compared to that of 65-70% in the case of Plywood.

The estimated installed capacity of GIL’s proposed plant will substantially increase India’s

existing capacity to produce MDF and will result in substituting foreign products with

domestic production. This will result in saving India’s foreign exchange reserves. Exports

from the Plant will also result in additional foreign exchange inflow.

There is a national initiative to protect and increase India’s Green Cover year on year.

Therefore the stellar economic growth of India has to be environmentally sustainable. As

Indian GDP grows at an estimated 6% during 2013-14 and at a higher % then onwards, the

wood based panel demand will grow exponentially. India, as a country needs to make a

paradigm shift in the kind of the wood panel products it uses and the fundamental objective

of the shift should be to place minimum burden on the National Green Cover. The

developed economies have moved from the traditional inefficient wood panels to MDF over

the past decades and India has a long catch up to do in near future. We attach the

following table from the Global MDF Year Book 2010-11 which shows the frantic pace at

which China, a similar fast growth developing economy has embraced MDF and

dramatically increased their MDF Production to 37 Million CBM against India’s 0.7

Million CBM during 2011. It is a National duty to enhance MDF production and substitute

the inefficient panels with wood efficient MDF Panels, thereby ensuring sustainable

economic development. We may note that the growth in North America and Europe is

gradual as these are matured MDF markets, having embraced MDF decades ago.

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Regional Raw Material Benefit:

The fact that a lot of raw material will be waste wood, including saw dust, lops and tops, saw

mill wastage, etc. will result in productive utilization of material that is otherwise used as fuel

in industries.

Apart from the waste wood, the plantation wood species to be used in the proposed Plants are

grown on land owned by farmers and provide a direct source of income to them. The State

Forest department and the Forest Development Corporation of Andhra Pradesh (APFDC) also

engage in plantation, harvesting, and selling of these species as it provides a useful utilization

of wasteland, as well as valuable income to the state and the community. The Indian wood

species that would be used are Eucalyptus, Subabul, Casuarina, Prosopis, Acacia and

Poplar.Since these species have a very fast growth cycle, and with various clonal

development have become better both in terms of quality and yield, the raw material from

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planting is available in 3-4 years. These species are readily available in the state of Andhra

Pradesh, with sizeable plantation activities ongoing and thereby posing no threat to

deforestation.

The fact that raw material will be sourced through farmers, and that too without debarking,

would result in the farmers being encouraged towards further plantations. Also, the fact that

the current users demand material only in debarked form which is a very tedious, manual and

wasteful activity has discouraged the farmers from engaging their land in further wood

planation. Using the bark in production instead of wasting it is a green initiative embedded in

the MDF production.. The fact that this project will provide the Farmers another avenue to

market their crop, and also at better terms such as with bark will eventually result in better

realizations for the Farmers. This will result in the farmers being encouraged to plant more,

meaning further growth in planted area in the State.

Greenply also proposes to work very closely with APFDC in procuring and ensuring

sustainable raw material growth. The fact that Greenply will purchase material with bark is

also an incentive for the APFDC, as debarking is a tedious activity for them, and this result in

moisture loss which in turn results in revenue loss for APFDC. By selling their resources to

GIL Project, the APFDC and in turn the State Government will be able to substantially

increase their revenues

A large chunk of the land under APFDC is currently under other crops, or some under no

plantation. With the demand created by this Plant, APFDC will also have an option to

increase plantation in its own land, resulting in further forest coverage.

We also intend on setting up a clonal nursery facility, like we have with all our production

facilities in different states, which will be used to support the farmers, JFM’s etc. by

supplying good varieties of plants. This will increase growth and reduce growth cycles. We

also propose to hire qualified consultants, and provide education to farming community on

the good practices for plantations, and increased efficiency.

Since this is a capital-intensive plant, it will be an organized industry, this will result higher

revenue of taxes, both for the State and Central government. A large portion of the material

will be sold in Andhra Pradesh, which would result in substantial VAT income for the State.

Note: No timber naturally grown in the forest will be used. No commitment for supply of

wood from the Forest Department is sought / expected.

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Employment Generation due to the integrated Project:

The integrated plant will generate employment for approximately 500 People. This will be a

good upliftment for the local area. Apart from this, indirect employment from Vendors

involved with raw materials supply as well as various jobs within the Plant will enhance

employment. Further, the total volume of commercial activity of raw material buying,

contractual work, back office work will offer considerable indirect employment. The

Plantation activity will also involve large manpower deployment at the agricultural fields and

huge inflow of the funds to the rural economy.

3.0 Project Description

3.1 Location

Proposed plant site is located at Village – Routhu Suramala, Mandal - Thottambedu, Sub-

Registration District - Thottambedu, Registration District – Sri Balaji, District – Chittoor,

Andhra Pradesh. About 196.21 acres of land located in Survey No 97/1, 98 & 99 is required

for the integrated plant. Study area map and google imagery showing the proposed plant

location are shown in Figure-1 and Figure-2 respectively.

3.2 Size and Magnitude of Operation

The integrated Plant will be over an area of 196.21 Acre.

The Plant will have an Organic (Liquid) Resin manufacturing facility of 100,000 Tons per

annum, which may require around one acre of land.

The Production capacity of the MDF plant will be 1200 CBM per day, making it the largest

MDF in India. It will surpass Greenply’s existing Plant in Uttarakhand which is currently the

largest MDF & PB plant in India.

3.3 Project Description with Project Details and Flow Charts of Process

Flow Chart Process of Resin plant is enclosed as Annexure-I.

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FIGURE-1

STUDY AREA MAP

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FIGURE-2

GOOGLE EARTH MAP

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3.4 Raw Material required along with Estimated Quantity, likely Resource, Marketing Area

of Final Products, Mode of Transport of Raw Material and Finished Product

Formaldehyde : 62500 tonnes

Urea& Melamine : 37500 tonnes

Likely Source of major Raw Materials

Chemicals: Manufacturers, Traders, Public Sector Units

Marketing Area of Final Products

The final products shall be used for the captive consumption of the MDF integrated plant.

Mode of Raw Material and Finished Good Transport

All domestic Logistics, both Sales and Procurement would be primarily through road and in

some cases through Rail.

3.5 Utility Source and Requirement

Availability of Water, its source and requirement

The total requirement of water will be 10 m3/Day, which will be sourced from surface

water/process water.

Ground Water Condition

The granitic and gneissic rocks are devoid of primary porosity: however on weathering,

jointing and fracturing they develop secondary pore spaces (porosity). The ground water

occurs under table conditions in weathered mantle and under semi-confined conditions in

jointed/fractured Granitoids and schists rocks at shallow top deeper levels. These are mostly

tapped by bore wells; there are few ground water extraction structures in a major part of

lowland regions. Bore wells are successful along certain identified lineament.

Depth to Water

Ground water occurs under confined to semi-confined condition in the deep interconnected

joints and fractures. Shallow water level zones with a depth of water level are less than 2m.

Moderately to deeper water levels zone with water levels zone with water levels more than

above 2m.

Requirement of Heat and Power for resin ( Per annum)

Steam - 20000 MT

Electricity – 2 Million unit

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3.6 Quantity of wastes to be generated (liquid & solid) and scheme for their

Management/disposal

Waste Generation from Resin Plant and from Other Activities

There is no solid waste generation during the Resin production process.

The waste water generation from Resin Plant and other activities of Floor Wash, Equipment

Washing and Domestic Use will be approximately 10 KLD.

Wastewater treatment

Waste water treatment plant will be designed as a common ETP for all the manufacturing and

Captive Plants.

4.0 Site Analysis

4.1 Connectivity

Site address : Survey No97/1, 98 & 99 of Village – Routhu Suramala,

Mandal - Thottambedu, Sub-Registration District -

Thottambedu, Registration District – Sri Balaji, District –

Chittoor, Andhra Pradesh.

Nearest Metro : Chennai 145 Km connected via NH 5

Nearest Port : Chennai 145 Km and Krishnapatnam 93 Km

Nearest Railway Station : Srikalahasti 13.6 km

Nearest Airport : Renigunta (Tirupati) 23 Km and Chennai 145 Km

Distance to State Capital : Hyderabad, 565 Km

4.2 Land Form, Land use and Land Ownership

The land is a barren agricultural land and it is converted for Industrial use. The Land title and

conversion documents are attached as Annexure-II.

4.3 Topography

The site area is on a top level surface of elevated at an altitude of about 42m above mean sea

level (msl). The south boundary follows the path at contour elevation is about 34m msl and 2

km radius of study area contour elevation difference is 8m msl.

The area is pediplain and a minor lineament which is Lineament-1 (L-1) N-S direction. The

area is generally North –South Low ground almost slopes towards South. The drainage course

is flowing towards north to south direction.

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The drainage is dentritic to sub-dentritic and drainage courses is first order, having well

defined courses traversing discontinuously with scattered cultivated agricultural fields.

The important rivers are Swarnamukhi and Kalinga. The drainage in the area is ephemeral

type, carrying large quantities of water immediately after rain. The drainage pattern is

dentritic to sub-dentritric.

4.4 Existing land use pattern

The land use of the project site is under industrial use.

4.5 Existing Infrastructure

The current site has no industrial infrastructure. The civic infrastructure is also very scarce

with no proper road from the State Highway to the Plant. There is no industrial site nearby.

4.6 Soil Classification

Soil occurring in the study area appears to be the product of weathering of the local rocks.

The major soil types identified by the Soil Survey and Land use Organization in the study

area are:

The red soils form the most common soil type in the study area and are distributed

unevenly. Deep to very deep, medium to fine textured red calcareous soils with depth

range from 45 to 90 cm is also observed. They are mostly sand to loamy sand.

4.7 Climatic Data from Secondary sources:

The Season data from Local Meteorological Department for 10 years is provided in

Annexure-III.

4.8 Social Infrastructure available

The nearest town is Srikalahasti, located on the banks of the river Swarnamukhi. Recently, it

has been included in the TUDA (Tirupati Urban Development Authority) region.

Srikalahasti is located 38 km north of Tirupati central. It is one of the assembly constituencies

in Chittoor District.

Education:

Srikalahasthi has many educational institutions ranging from Elementary schools to

Engineering & Degree Colleges. In recent years, the Srikalahasteeswara temple trust board

started a nursing college also in Kasa Gardens.

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For Intermediate education, there are separate Government junior colleges for Boys and Girls.

Government boys’ junior college is near to Panagal, and the girls’ junior college is located at

Ayyala Nayudu Lake, near to the Government Hospital and the APSRTC Bus station.

Government:

It is located under the administration of Chittoor district. The Srikalahasti mandal

headquarters are located here.

Demographics:

As per 2001 India census, Srikalahasti had a population of 1,20,000. Males constitute 50% of

the population and females 50%. Srikalahasti has an average literacy rate of 67%, higher than

the national average of 59.5%: male literacy is 75%, and female literacy is 59%. In

Srikalahasti, 12% of the population is under 6 years of age.

Transport:

The nearest airport is Tirupati Airport located at about 23 km from the site. Site is well

connected by rail and road. SH-6 is about 4.3 km from the plant site. It is on the Renigunta-

Gudur section of Guntakal (GTL) Division of the South Central Railway (SCR).

5.0 Planning Brief

5.1 Planning Concept

The Plant will not require planning of a separate township. The total manpower for the Plant

will be evenly spread out over the two nearest towns of Srikalahasti and Naidupetta.

Therefore we do not foresee any enhanced social infrastructure requirement in the area. The

population projection hence is not required.

The Land use planning is based on the statutory requirements under the various statutes. The

uncovered area will have a Green Belt.

The Plant will have sufficient social amenities and facilities to maintain a positive atmosphere

among the factory employees and workers.

6.0 Proposed Infrastructure

6.1 Industrial Area – Process plant area

Company acquired land admeasuring 196.21 acre. In compliance to the statutory norms for

site development, green belt / cover is to be provided.

Balance land will be utilized for Process and Utility service activity as well for administrative

and welfare activities.

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Since this is wood based industry, a specific focus to be made for fire and safety precautions

at all stage of production and storage activities.

Process plants will be located as per the process flow and compliance of VASTU norms.

The plant buildings will be of composite construction – steel structure and RCC structure.

Adequate provision for storage of water will be made considering process plant requirement

as well reserve storage for firefighting.

Utility services including Power generation plants with its required infrastructure will be

developed as a unit.

6.2 Residential Area

MDF manufacturing with contipress is a continuous manufacturing process and therefore

some of the critical operations are to be manned promptly in case of break down. A dedicated

area will be allotted for development of Residential dwellings – specifically for such essential

staff viz. Firefighting personnel, security supervisions, Maintenance technicians, Electricians

etc.

We propose to develop such facility for essential staff to stay as per necessity. The facility

will include social infrastructure facility for the people staying in this residential area.

6.3 Green Belt

Green belt is proposed all along the boundaries of the plot and will plant appropriate type

trees to provide a thick green wall. A systematic irrigation system will be installed and the

treated waste water will be utilized for watering the trees.

6.4 Drinking Water Management

Underground water source will be pumped through Tube well and after primary and

secondary filtration, a structured network for Drinking water distribution will be made for all

parts of the plant. Rain water harvesting will also be practiced.

At user points, a dedicated tertiary filtration / purification systems will be installed for

Purified quality of drinking water.

6.5 Sewage System

All domestic waste from the Toilets will be conveyed through underground sewage pipes and

brought to a collection tank. The equalized sewage will be treated through Sewage treatment

plant and the treated water will be used for gardening. Sludge will be dried in sludge drying

bed and will be used as manure for greenbelt.

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6.6 Industrial Waste Management

The wastewater from all the sources (integrated plant) will be collected in equalization tank

for downstream chemical / aerobic – anaerobic treatment according to the quality analysis of

the quality of water after equalization tank.

Treated wastewater will be used for our industrial / agriculture use and therefore depending

on the quality of treated water a tertiary treatment to be carried out to bring the water quality

good for industrial cooling circulation.

6.7 Solid Waste Management

No solid waste will be generated

Lubricants and oils – which is drained from the mechanical components will be collected in

drums and will be sold to oil refinery.

6.8 Power Requirement & Supply / Source

The requirement for resin plant shall be sourced through grid.

7.0 Resettlement & Rehabilitation Plan

Resettlement and Rehabilitation is not applicable as the entire land has been purchased on

mutual agreed terms and conditions. The land has already been converted for industrial use.

8.0 Project Schedule and Cost Estimates

Sr. No. Description Estimated cost Rs. Lakhs

1 Land and Building 300

2 Plant & Machinery including related Civil,

Electrical, Structural and Pre-Operative

Expenses.

1075

Total 1375

8.1 Projected Implementation Schedule

The resin plant project would be completed within –four -months after obtaining Consent to

Establish from APPCB.

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ANNEXURE-I

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