On its new paint business, Birla Opus, it said production has started at three plants and the remaining three are on track for completion. All six plants will be fully operational by fiscal 2025.
Aditya Birla Group Chairman Kumar Mangalam Birla on Tuesday said the conglomerate’s construction materials business is expected to witness significant growth in the coming years and cement and decorative paints will emerge as a key segment on the back of India’s housing and infrastructure boom.
Furthermore, the outlook for the Indian economy remains “positive”, supported by strengthening macroeconomic fundamentals, a sound financial and corporate sector and a resilient external sector.
The government’s continued emphasis on capital spending as it pursues fiscal consolidation and consumer and business optimism bode well for investment and consumption demand, he said.
Birla was addressing the annual general meeting of the group’s holding company, Grasim, which controls the group’s flagship companies including UltraTech, Aditya Birla Finance and other investments in textiles, chemicals and paints.
Grasim has invested Rs 50,000 crore in capital expenditure over the last five years, of which 77 per cent is dedicated to growth initiatives, he said, adding that this would position it for sustained growth and value creation.
“Surprisingly, 40 per cent of this amount, nearly Rs 20,000 crore, was spent in FY 2023-24 alone, marking the highest capital expenditure in our history,” he added.
According to Birla, its cement and decorative paints will be a key segment of this expansion, with “strong demand” projected across the country.
“With our cement business, UltraTech, our decorative paints business, Birla Opus, and our B2B e-commerce platform for construction materials, Birla Pivot, we are well equipped to lead the charge in meeting the growing construction needs in India,” Birla said.
Cement maker UltraTech is rapidly increasing its capacity through acquisitions and brownfield expansions. Last month, it announced the acquisition of Tamil Nadu-based India Cements Ltd (ICL). Its Rs 3,142 crore open bid to acquire a 26 per cent stake in ICL will open on September 19.
In FY2024, it increased its cement production capacity by 13.8 MTPA through expansion projects and crossed 150 MTPA of production capacity. It is now the third-largest cement company in the world excluding China.
“With the completion of ongoing expansion projects across India, and after receiving requisite approvals for the recently announced acquisitions of Kesoram Cement and India Cements, our total cement capacity will cross 200 MTPA by FY27,” Birla said.
On its new paint business, Birla Opus, it said production has started at three plants and the remaining three are on track for completion. All six plants will be fully operational by fiscal 2025.
“We remain confident in our forecast of achieving Rs 10,000 crore in revenue within three years of full-scale operations,” he said.
Its B2B e-commerce business for construction materials, Birla Pivot, has crossed Rs 1,000 crore in revenue in its first year of operations.
“With the strong growth trajectory of the building materials sector and rapid digital adoption across industries, Birla Pivot aims to achieve USD 1 billion in revenue over the next three years,” Birla said.
He also added that in line with its goal of becoming a net-zero company by 2050, Grasim is actively working to reduce its carbon footprint and improve environmental sustainability through various measures.
In FY24, Grasim’s annual revenue stood at Rs 1,30,978 crore, surpassing USD 15 billion in consolidated revenue.
Founded in 1947, Grasim operates in segments such as Viscose Staple Fibers, Viscose Filament Yarns, Chemicals, Textiles, Insulation, Paints and B2B E-Commerce.
Through its subsidiaries, UltraTech Cement, Aditya Birla Capital and Aditya Birla Renewables, it is also India’s largest cement producer, a leading player in diversified financial services and a player in clean energy solutions.
(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First published: August 20, 2024 | 19:14 IS
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