Saint-Gobain to proceed with ₹2,500-cr. investment in India
Article By: Lalatendu Mishra
French multinational company Saint-Gobain said it will continue its planned investment of more than ₹2,500 crore in greenfield and brownfield expansion in India in two years.
The company is also looking to invest in start-ups and strategically-fit acquisitions to capitalise on the growth opportunities.
“We are ahead of the curve on the investment front,” said Santhanam B., chairman and managing director, Saint-Gobain India Pvt. Ltd. “Based on the long-range plan, as a group, we will be completing investments of ₹2,500 crore in FY22 and FY23. We are creating larger facilities, looking at potential acquisitions, investments in start-ups, accelerating spends on digital transformation and increasing R&D spend.”
The plan includes two investments of ₹500 crore each in capacity expansion and an investment of ₹1,000 crore in a greenfield plant to manufacture building materials for which the location is yet to be finalised. He said the company had cash of more than ₹2,000 crore in its balance sheet, which would be used for capex.
The investments in start-ups and inorganic growth would be over and above the committed investment.
Stating that business in the April-June ’21 quarter would be severely impacted because of the second wave of COVID-19, he said while this quarter would not be as bad as the same period last year, it would still be a challenging one.
“This second wave might push the recovery behind by six months, but we are not deviating from our long-term plans for India in terms of investment or idea,” Mr. Santhanam said, adding that the long-term prospects for business were robust.
“We believe that the long-term story of India both from the point of an economy growing as well as a contribution for exports of advanced manufacturing products, it is ahead of the curve of IT and digital transformation and can play a global role,” he added.
He said there would be difficulties in this fiscal but that would not force them to deviate from a long term growth path.
Saint-Gobain India which represents almost all manufacturing ecosystems, be it steel, aluminium, fabrication, infrastructure, auto OEM and components, building and construction had reported improved performance of 14% growth on top line and growth in profits in the nine months starting July 2020 to March 2021 as it reduced costs, improved manufacturing processes, introduced new range of products and solutions, and focused on digitalisation, he said.