The Telegraph
Since 1st March, 1999
Email This Page
AV Birla group chief chants core mantra

Bhubaneswar, March 10: Private sector conglomerate Aditya Vikram Birla group has decided to exit from non-core areas and focus on its core competencies to become a “true multinational”.

The Rs 22,000-crore group, in the throes of a restructuring exercise for the past four years, will continue to focus on cement, metal, fertiliser and fibre through Indian Rayon, Grasim, Indo Gulf, and Hindalco.

Group chairman Kumar Mangalam Birla said: “We will witness a tighter business portfolio, possibly exit from businesses where we are a small player or where we can’t meet performance expectations. To fuel even faster rates of growth and to consolidate our positions in those segments, we will place larger and bigger bets in segments where we remain.”

Elaborating on their plans for the cement business, he said the group aims to more than double its capacity from 12 million tonne per annum (MTPA) to around 25 MTPA in the next five years. “This could be achieved through the organic process or acquisitions. We are looking at both.”

While refusing to disclose Grasim’s divestment strategy, he said the company would primarily stick to cement and fibres. There is no particular investment plan for the textile and sponge iron businesses at present. The group is planning a further expansion drive in the carbon black business with an aim towards a global footprint in this segment.

Indo Gulf Corporation, which has recently hived off its copper business to Hindalco, will focus on fertiliser. The group is closely watching the government’s selloff plans as well as the fertiliser policies. “Once these policies are clear, we will be able to chart out future growth strategies for Indo Gulf, which remains one of our core businesses,” he said.

Birla, however, remains optimistic of Idea, a cellular joint venture with the Tatas and AT&T. “We are committed to our exposure and ready to invest further if required,” he said.

Consolidating all non-ferrous metal businesses under Hindalco, the group plans to invest over Rs 15,000 crore to set up a greenfield integrated project, Aditya Aluminium and Utkal Alumina in Orissa, he added.

Email This Page