A truly sustainable business model

Many dream of a sustainable world, but Neptune Papers (Pvt.) Ltd. is fulfilling that dream every day. A wholly-owned subsidiary of Ex-Pack Corrugated Cartons Ltd., Neptune Papers, also known as Neptune Recyclers, is a provider of recycling solutions for paper-based waste. The company collects more than 10 grades of paper waste, which would otherwise end up in landfills, and proceeds to process this material for recycling and or upcycling into new usable paper, board, and raw materials for the paper-making industry. The Morning Business spoke with Neptune Papers General Manager Fazleen Majeed to better understand their environmentally friendly, sustainable, and profitable business model; particularly as the parent company, Ex-Pack, is shortly about to make an Initial Public Offering of its shares and seek a listing on the Colombo Stock Exchange. 

Providing an overview of the business, Fazleen explained: “Our goal is to create a closed loop where products are manufactured, used, collected and then recycled or upcycled for use again, with minimal waste and adverse impact on the environment. For example, we work closely with our parent company to ensure minimal waste during the process of manufacturing corrugated cartons. Whatever waste is generated is then channelled through us and we process it to create new usable products. We work with a wide variety of businesses and other organisations to collect paper-based waste through our island-wide collection and supplier network. Whether it’s a household, corner shop, local collection authority, SME, or large industry, we do not discriminate. Instead, we provide convenient solutions, including logistics, to ensure that this waste is collected and brought to us, to be processed for recycling.”

Neptune Papers has established a strict quality control system that screens all the collected recyclable material that enters their state-of-the-art processing centre. Trained staff are also constantly on the lookout for materials that can potentially be upcycled as these need to be processed separately. Recyclable material is processed through Neptune Papers’ automated baling technology, and prepared for further recycling or export. 

Placing emphasis on the Company’s upcycling operations, Fazleen said: “We take every effort to ensure that we are able to upcycle as much of the waste as possible, instead of channelling it into the recycling process. This is because good quality materials like newspapers and magazines can be easily converted into products for packaging, particularly for fruits and vegetables and for use as bags. This allows us to help support other SMEs as well, who then take on these products for further upcycling and or sale and distribution. The recyclable waste is processed by our facility and sold onwards to paper mills who process it into fresh reams of recycled paper and board, which is then used by others to create products such as corrugated cartons, inner cartons, writing and printing paper and tissues and wipes, among others. Thus, a significant portion of the corrugated cartons produced by our parent company, Ex-Pack, actually come from recycled paper waste, further adding to the sustainability of our combined businesses.”

Neptune Papers’ parent company Ex-Pack Corrugated Cartons Ltd. is seeking to raise Rs. 700 million in capital from the public through the sale of 83,333,333 ordinary voting shares at a price of Rs. 8.40 per share, at its upcoming IPO, resulting in a projected market capitalization of Rs. 2.8 billion. Ex-Pack serves top corporate customers and brands worldwide across a range of industries, including FMCG, consumer durables, apparel, tea and fisheries. Ex-Pack’s team presently produces upwards of 2,650 metric tonnes (MT) of corrugated cartons each month at its 203,000 square-foot production facility, with this expected to rise to 4,000 MT on the back of its planned new manufacturing plant, set to become operational by 2025.

Neptune Recyclers enjoys a reputation for sustainability within Sri Lanka’s recycling industry, while consistently and continuously supporting SMEs and the communities the company works with. Discussing this, Fazleen went on to explain: “The collection and transport of paper waste provides livelihoods to many people who may otherwise lack opportunities in life. Thus, we are very humbled to know that, through our business activities we are helping many people sustain themselves and their families. In fact, over the years, we have been instrumental in supporting the growth of many entrepreneurs to build their own businesses and grow within the recycling industry as part of our network and supply chain. As a sustainable business, we are also big proponents of the ‘reduce-reuse-recycle’ mantra. Thus, through educational programmes, we encourage people to ‘reduce’, while focusing strongly on the ‘reuse’ and ‘recycle’ part of that mantra.”

Neptune Recyclers, having grown to become a giant in Sri Lanka’s waste paper recycling industry, is now also looking to expand its business activities into other areas of recycling to further improve their value proposition and build on their sustainable business model. As a recycler, the company is looking at how it can help to combat the problems of plastic, electronic, and fabric waste.

Elaborating on the company’s future plans and how recycling can help create a better world, Fazleen added: “There are plenty of opportunities for expansion into new areas of recycling. We intend to rely on our own experience and collaborate with others already active in these areas to create new value chains. Through recycling, we can truly make the changes we need to live in a more sustainable world. For example, as a recycler of paper waste, I can tell you that with every ton of paper that is recycled, we prevent the cutting down of 17 mature trees, save 4,000 KWh of electricity, 31,780 litres of water, 1,755 litres of oil, and keep three cubic metres of waste from entering a landfill. But there is still so much more that we can do and we are actively looking to expand our activities to include other recyclable waste as well.”