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Murugappa Group’s focus on consolidation and shoring up capacity utilisation across its diversified businesses has contributed to significant growth in sales and profit in a tough year, according to MM Murugappan, Vice-Chairman of the ₹27,000-crore conglomerate.
Addressing media persons on the Group’s performance in 2014-15, he said it has managed to grow in a tough year with continued slow economic conditions. Its turnover grew 11 per cent over the previous year to ₹26,926 crore with profit before tax jumping 26 per cent to ₹1,780 crore.
Financial services – NBFC and insurance businesses — was among the biggest contributor to profits among its wide range of businesses including fertilisers and agriculture inputs, sugar, engineering, financial services, automobile components and bicycle manufacturing.
Capacity utilisation across its manufacturing businesses had increased to about 70 per cent against 50-60 per cent in the previous year. With spare capacities available, the group is toning down on capital expenditure which will remain at about ₹250 crore like last year, Murugappan said. TI Cycles, one of the group companies, is expanding its bicycle production capacity with a new unit in Rajpura, Punjab where it is putting up a ₹95-crore factory to make 1.5 million cycles a year. Its capacity now is about 4.5 million units across three units in Chennai, Nasik and Noida. The company is focussed on high performance and high value cycles.
EID ParryIt is also expanding its ₹300-crore nutraceuticals business with a ₹27-crore investment to increase the production of marine alga Spirulina. The output will increase from 485 tonnes to about 619 tonnes. The joint venture for making agriculture equipment Yanmar Coromandel AgriSolutions Pvt Ltd between Coromandel International and Japanese companies Yanmar & Co and Mitsui has taken off with imported rice transplanters and tractor-drawn rotavators being sold. Plans are on to set up an assembling unit, he said.
Coromandel International, which is into phosphatic and complex fertiliser production grew by 13 per cent to ₹11,416 crore. Carborundum Universal, a group company is transferring its electro mineral businesses from South Africa to India.
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