• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

For exports, raw material sourcing

MR A. VELLAYAN

Chennai May 8 The Murugappa group is exploring overseas business opportunities for exports and raw material sourcing to consolidate its position at home. Raw material is the key for growth in the fertilisers and abrasives business. The group companies are exploring overseas locations for raw material based sourcing. They are `actively prospecting for ammonia and urea in two-three countries.'

Coromandel Fertilisers and Godavari Fertilisers need over 5,50,000 tonnes of ammonia and 4,00,000 tonnes of urea. Similarly, Carborundum Universal, an abrasives company, was also looking at overseas sources of raw materials such as aluminium oxide and silicon carbide, Mr A. Vellayan, Vice-Chairman of the group, told a press conference here today.

He said the group had chalked out a capital expenditure of over Rs 1,000 crore in 2007-08 for its major business areas — fertilisers, sugar, tubes, abrasives and financial services. These are areas in which the group was taking a long-term view. Last year, it spent Rs 480 crore.

Mr Vellayan said the companies in the fold were looking at overseas acquisitions to expand raw material availability and market reach. Overseas business contributed to about Rs 550 crore of the 2006-07 turnover.

Between Tube Investments' tubes and chains division and Carborundum Universal, the Murugappa group is investing over Rs 150 crore in Uttarkhand. These companies are expected to start operations later this year, he said.

Carborundum Universal has also entered into a joint venture agreement with China Engineering and Exploration Bureau to acquire a 49 per cent stake in Sanhe Yanjiao Jingri Industrial Diamond Company, China, to strengthen its abrasives range and access the global markets.

Carborundum Universal has also set up a high precision microgrit manufacturing facility in Palghat to cater to solar wafer cell makers.

Apart from the traditional businesses, the group was keenly watching emerging business opportunities like nutraceuticals, the algae-based nutrients. The company will invest over Rs 100 crore soon in setting up a 300-acre facility for producing Omega-3 compounds. It is scouting for a coastal location where it will cultivate marine algae. The nutraceuticals business has been merged with EID Parry and is set to grow to about Rs 200 crore in the next three or four years, he said.

Integrated Facilities

During the year, EID Parry set up a 22-MW cogeneration plant and an ethanol facility. It is investing over Rs 350 crore for a distillery at its Pudukottai and Sivagangai sugar mills. The company is in the process of converting its sugar mills to integrated facilities with cogeneration and distillery facilities.

In its financial services business, the securities and distribution services operations of DBS Cholamandalam were integrated under the wealth management and services umbrella to offer comprehensive investment solutions for customers, he said.

More Stories on : Diversified | Overseas Investments | Exports & Imports | Fertilisers

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Murugappa group exploring overseas acquisitions

Copyright © 2007, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line