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Kesoram Industries Ltd, the diversified flagship company of the BK Birla group, is planning to restructure its businesses.
Mr B.K. Birla, Chairman of the company, told reporters after its 92nd AGM here on Tuesday that McKinsey has been appointed to prepare a report and recommend an appropriate strategy in this direction. The company is into cement and tyres. But there are business interests in spun pipes, rayon and chemicals too. While the first two are non-operational divisions of the company, a closed entity — Hindusthan Heavy Chemicals, a subsidiary — still exists in its books.
The company management is also looking at revamping “product lines” with an eye on boosting the bottom line.
The company's tyre division, Birla Tyres, has been facing pressure on the margins and is planning to induct higher-margin products.
It is also planning to appoint a new CEO for the business.
Mr Deepak Tandon, former CEO, left the company early this year.
“McKinsey will map out the future course of action,” Ms Manjushree Khaitan, Mr Birla's daughter and a director, said. During 2010-11, Kesoram Industries reported a net loss of Rs 210.2 crore against a net profit of Rs 237.3 crore in 2009-10.
This was mainly because of poor performance of the tyre division.
On another matter, Ms Khaitan said Mr Kumar Mangalam Birla will not be joining the board and taking charge of the company in the near future. “He will take charge when it is required,” she added.
Mr B.K. Birla had earlier indicated that while Mr Kumar Mangalam Birla will be the future Chairman of the company, Ms Khaitan would be the Vice-Chairperson.
Mr Birla said: “Kumar Mangalam is holding 28 companies at present. He is not yet ready to take additional responsibility.”
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