Dalmia Bharat Refractories Ltd, part of the Dalmia Bharat Group, plans to tap into export markets particularly Europe, West Asia, Africa and Asia — that include Vietnam and Bangladesh — apart from consolidating presence in India.
Overseas acquisitions are being explored and talks are on with “two probable entities” in Europe.
Dalmia Bharat Refractories Ltd was formed following the merger of three different refractory units of the Dalmia Bharat Group. The merger was completed in March 2022. The company aims to be listed on the BSE by end-FY23 (one of the merged entity is listed on the Calcutta Stock Exchange and Metropolitan Stock Exchange).
Steel, cement sectors drive refractory growth
According to Sameer Nagpal, MD and CEO, Dalmia Bharat Refractories Ltd, the company is eyeing a turnover of ₹1,500 crore this fiscal, a 20 per cent rise year-on-year. In both the domestic and international markets, refractory growth is being driven by the steel and cement sectors; and also a “China plus one strategy” that companies are taking up to de-risk supply chains post Covid-led disruptions.
China continues to be the world’s largest maker and supplier of refractories. However, in India, some of the steel and cement companies, including PSUs, have now started shifting orders to Indian makers, and avoiding Chinese offerings.
“We have started some trials in Germany before we turn regular suppliers and tap deeper into the export market. We are already present in Germany, Belgium, Italy and France in Europe for steel refractories; in Spain, Canada, West Asia, Nigeria, Kenya and Morocco for cement refractory. We are looking to gain a greater share of the customers’ wallet in these markets and in India,” Nagpal told BusinessLine.
Nearly 25 per cent of the company’s turnover comes from a German company acquired previously; whereas 10-15 per cent of the turnover comes from Indian offerings exported.
“At least one of the two acquisitions we are looking at should materialise by the end of this calendar year. We can take external funding, if required,” he said, adding that “listing on the BSE will be an added advantage”.
Dalmia Bharat Refractory will also look at a capex of ₹300 crore over the next three-four years as it looks at a capacity ramp-up and “investment towards R&D” across units. Around ₹80-100 crore has been spent between FY19 and FY21.
The company currently has five manufacturing units in India, and one each in Germany and China.