CUMI Plans Rs 30 Crore For Capex

Chennai, Aug 26 | Updated: Aug 27 2004, 05:30am hrs
Carborundum Universal Ltd (CUMI), a Murugappa group company, is planning to shell out Rs 25 crore to Rs 30 crore towards capital expenditure this fiscal. This includes Rs 8 crore to Rs 10 crore to be spent on the expansion of the companys plant in Hosur.

Addressing a conference here on Thursday, MM Murugappan, chairman, CUMI said the Hosur facility expansion will be to scale up manufacturing capacity in electrominerals, grains and for setting up coal washeries. The Hosur facility of CUMI caters mainly to the Australian market. Our sales in the Australian market is to the tune of 3.5 million Australian dollars. It is a growing business for us, Mr Murugappan stated.

CUMI is also looking at overseas acquisitions to compete in the international market in a big way, Mr Murugappan said. We are looking at opportunities for acquisitions in Europe and parts of Asia. We have a dedicated team scouting for opportunities in China, he pointed out. The company made an entry into the Australian market in 2003, with the establishment of a marketing and service centre in Australia.

At present exports contribute 10 per cent of CUMIs total sales. The company also aims to step up its exports to 20 per cent of its total sales in three years time, Ramesh Agarwal, chief executive officer, CUMI said.

The company is also strengthening its distribution network in Europe and the US, which contribute a majority of the exports.

The total abrasives market is valued at Rs 650 crore, of which CUMI has a market share of 29 per cent. In the bonded abrasives segment, it has a market share of 50 per cent and in the coated abrasives the company holds 31 per cent share.