Grasim Industries, an Aditya Birla Group company, will increase capital expenditure by 59 per cent to ₹3,117 crore this fiscal in its existing businesses against ₹1,958 crore spent last year.

The capital expenditure would largely be for fresh capacity creation and modernisation of existing plants.

This apart, the company plans to spend ₹10,000 crore in its recent venture into paints business. Of this, the company has already spent ₹605 crore last fiscal. Additionally, it has earmarked ₹2,000 crore for the B2B e-commerce venture.

Kumar Mangalam Birla, Chairman, Grasim Industries, told shareholders at the company’s 75th annual general meeting that the company has exemplified the pioneer spirit at every stage of its growth and as it turns 75 years, it is ready to embark on yet another transformational growth journey which will be marked by the strong growth of existing scale businesses and creation of new growth engines. The strategic foray into paints and B2B E-commerce are decisive steps in that direction, he added.

Fresh investment in paint business will help the company to create a more significant pan-India presence leveraging the ecosystem available under the Grasim umbrella. The business is focused on project execution and is on track to achieving the plant commissioning timelines starting from March quarter of FY’24. The business has obtained land possession at all its six sites and the civil construction work has commenced at four sites, he added.

Global Headwinds

The International Monetary Fund expects the world economy to grow by 3.6 per cent in this year, which is 0.8 percentage points lower than its pre-war projections.

Many economies have experienced a sharp surge in inflation recently, particularly in food and fuel prices, taking their inflation rates to multi-decade highs. Central banks have been forced to respond to surging prices with aggressive rate hikes, he said.

The Indian economy has not remained unscathed by these global developments. Partly on account of the elevated commodity prices in global markets, India’s inflation has pushed higher than the target of the Reserve Bank of India.

On the positive side, economic activity in India has witnessed a sharp recovery to pre-pandemic levels on the back of a rapid and widespread rollout of the vaccination programme, said Birla.

Even as the global headwinds are being felt, India’s growth recovery is progressing well, and most estimates peg economic growth in this fiscal to be about 7 per cent. India, therefore, is poised to be the fastest-growing major economy in the world and an engine of global growth.

The above trends lend confidence to a robust economic narrative for India in the medium-term, which augurs well for the corporate sector as well, said Birla.