Companies

RHI Magnesita India to expand; merger of subsidiaries with Orient to be over by November

Shobha Roy Kolkata | Updated on September 17, 2019 Published on September 17, 2019

Parmod Sagar, MD and CEO, RHI Magnesita India

The Indian unit of RHI Magnesita, the refractory maker, is looking to expand capacity both through the organic and inorganic routes.

The company, which is into production and supply of high-grade refractory products, systems and solutions, recently acquired two units for an estimated sum of around ₹60 crore.

According to Parmod Sagar, MD and CEO, RHI Magnesita’s India operations, the company would aim to double its market share in India to 40 per cent in the next 3-4 years.

The refractory market in India is estimated to be close to ₹8,000 crore.

Refractory products are vital in all high-temperature processes in the making of metals, cement, glass and ceramics. The steel industry is one of the biggest consumers of refractory products, accounting for nearly 60-70 per cent of the total production.

RHI Magnesita has three operating companies in India: the listed company Orient Refractories, RHI India and RHI Clasil. Orient Refractories has a manufacturing unit at Bhiwadi in Rajasthan and two franchise services (toll manufacturing) at Salem in Tamil Nadu. RHI Clasil has a plant at Vizag in Andhra Pradesh. Put together (own and toll manufacturing), RHI Magnesita has a total capacity of 200,000 tonnes.

The company, which recently acquired Intermetal Engineers Ltd and some of the assets of Manishri Ceramics, is exploring options for inorganic growth. “We are looking into various options. We are open to acquire any company which fits into our scheme of things. We know some good targets,” Sagar told BusinessLine.

When asked about the status of merger of the two unlisted subsidiaries — RHI India and RHI Clasil — with Orient Refractories, he said that the process is likely to be complete by end of November. Following completion of the scheme and subject to receipt of necessary approvals, Orient Refractories is proposed to be renamed to RHI Magnesita India Ltd. “We have had shareholders and creditors meeting and approval. We have submitted the report to NCLT and we expect an interim order by next week and after that there will be a two months process,” he said.

Published on September 17, 2019
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