SKL spends Sh132m on Kisaju plant to lift output sevenfold

Listed corrugated carton manufacturer Shri Krishana Overseas Plc (SKL) has spent Sh132 million on its new Kisaju industrial plant, which is expected to increase its annual production capacity by more than sevenfold.

The new manufacturing hub, partly financed through a Sh117.9 million term loan from SBM Bank Kenya, remains incomplete amid delays, signalling the likelihood of further capital expenditure before the project is finished.

SKL's annual production capacity is projected to increase from 3,000 tonnes to 22,000 tonnes.

Construction Progress

"Construction of the company's new manufacturing plant is progressing well although it is running behind schedule. As of year-end 2025, capital work in progress stood at Sh13.9 million. The project continues to be supported in part by a long-term loan facility of Sh117.9 million," SKL says in its 2025 annual report.

The company says civil works at the plant are nearly complete, while all machinery has already been procured.

Management attributes the slower pace of construction at the Kisaju facility to a slower cash conversion cycle, which has moderated growth.

SKL disclosed a Sh117.9 million term loan from SBM Bank carrying an interest rate of 20.7 percent.

Capacity Boost

Completion of the manufacturing plant, which sits on a two-acre parcel of land, is expected to expand the firm's revenue base, which stood at Sh351 million in 2025.

SKL posted a lower net profit of Sh4.1 million for the year ended December 2025, down from Sh10.1 million a year earlier, mainly due to higher overhead costs, including listing expenses.

The firm listed on the Nairobi Securities Exchange (NSE) by introduction last year, becoming a publicly traded company for the first time.

SKL listed 50.5 million shares on the SME segment of the NSE in July 2025, marking the first listing on the Nairobi bourse since December 2020.

The increased production capacity is expected to support rising demand for packaging solutions, particularly from the dairy and edible oils sectors.

"We are seeing growing demand for packaging solutions in other areas such as the dairy, herbs, edible oils and confectionery sectors, which will add to the horticulture exports, the floriculture subsector, and the fast-moving consumer goods (FMCG), which were already well established," said Sonvir Singh, SKL Managing Director.

Growth Plans

SKL says it has begun increasing its workforce in preparation for the additional capacity expected once the new manufacturing plant is completed.

The manufacturer had 40 employees at the end of 2025, up from 33 a year earlier, with 22 in casual roles.

The technical department has nine employees, finance and administration has four, sales and marketing has three, while customer care and business development have one employee each.

SKL says it is also investing further in ICT to improve administrative efficiency.

"We have also made an investment in IT systems that will help us improve our administration, which is critical for the next stage of growth," said Nirmla Devi, SKL Finance Director.