Tube Investments of India
 
Tube Investments of India
Tube Investments of India Ltd.
Formerly TI Financial Holdings Ltd.
Murugappa group draws up Rs.1,500-crore capex plan
 
Mr. Vellayan, Chairman, Murugappa Group The Murugappa group has drawn up a Rs. 1,500-crore capital expenditure (capex) programme for 2011-12. It incurred a capital expenditure of Rs.410 crore in 2010-11.

Addressing a press conference here on Thursday, A. Vellayan, Executive Chairman of the group, said the Rs.1,500-crore capex commitment would mainly go to consolidate the group's position in dominant sectors with a focus on organic growth. Much of the capex would be spent on three companies — Coromandel International, Tube Investments of India and Corborundum Universal (CUMI).

The group reported a 25 per cent growth in turnover during 2010-11 at Rs. 17,051 crore, up from Rs. 13,617 crore in the preceding year. Earnings before interest, tax, depreciation and amortisation grew by 20 per cent to Rs.2,247 crore (Rs.1,879 crore). The profit before tax was up by 20 per cent at Rs.1,657 crore (Rs.1,382 crore).

Mr. Vellayan said the group was geared to achieve $7.2 billion turnover by 2013-14. A robust GDP (gross domestic product) growth, upbeat customer sentiment, initiatives on the efficiency front, capacity expansion and customer-focussed product innovation had all had positive impact on the growth story of the group, he said. The three acquisitions — Sadashiva Sugars, SEDIS and GMR Industries — had contributed Rs.463 crore to the turnover of the group in 2010-11.

Sales of Coromandel International grew by 18 per cent (at Rs.7,585 crore), Tube Investments by 35 per cent (Rs.3,308 crore), CUMI by 26 per cent (Rs.1,676 crore), EID Parry by 46 per cent (Rs.1,750 crore), Cholamandalam Investment by 28 per cent (Rs.1,222 crore), Cholamandalam MS General Insurance by 23 per cent (Rs.968 crore) and others by 15 per cent (Rs.543 crore).

Mr. Vellayan said Coromandel was well placed to take advantage of the new nutrient-based subsidy policy introduced by the government in April 2010.

The company, he said, also ventured into non-subsidy-based business such as speciality nutrient as a part of the de-risk strategy.

He said the focus now was to make all the acquired sugar facilities profit-making units. Eventually, they would be integrated with EID Parry. Silk Road Refinery, a joint venture with Cargill, had commenced production.

However, the plant was running at lower capacity due to partial gas allocation. He said the books of Cholamandalam Finance were totally cleaned up ever since the group's disengagement with DBS.

The company was now gearing up to the gold loan space. The group, he said, was looking at a growth of 25-30 per cent during 2011-12.