Carborundum Universal plans two new facilities in India

Updated - June 11, 2024 09:54 pm IST

Published - June 11, 2024 09:22 pm IST - Chennai

Carborundum Universal MD Sridharan Rangarajan says it would take two years to set up the new facility

Carborundum Universal MD Sridharan Rangarajan says it would take two years to set up the new facility

Murugappa group firm Carborundum Universal Ltd. (CUMI) plans to set up two new facilities in India to make thin wheels and high purity silicon carbide with an estimated expense of ₹350 crore in FY25, said a top company executive.

In FY24, CUMI acquired the assets, brand and technology of abrasive product manufacturer Dronco of Germany, which went bankrupt, similar to another German firm Rhodius acquired by CUMI in February 2022.

“We moved assets into India last month. We are setting up this facility in India using Rhodius technology and it would take two years. That is how the synergies will play out,” said MD Sridharan Rangarajan on an analysts call.

Mr. Rangarajan said the new plant will have a capacity to produce 50 million thin wheels and generate revenue worth ₹250-300 crore from FY27.

CUMI will also set up a six-ton-per-month high-purity silicon carbide facility in Kerala. This will take about 18 months. Besides, this the firm will set up IT infrastructure and safety-related capex.

The carbide facility will serve two markets - the semiconductor industry where high-purity silicon carbide will be used and in the technical ceramics field. Capacity will be scaled up upon utilisation.

Asserting that they have moved from a lab to establishing a plant, he said they have tied up with an anchor customer in silicon carbide for ceramic business and another for semiconductor use.

The MD said CUMI continues to be debt free and that the newly acquired firms Rhodius and Awuko are on a growth path.

“We have done a good job in terms of reorganising and strengthening the leadership team at various levels. And we are currently working on a long-term strategy and a vision going up to 2030,” he said.

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