RHI Magnesita investing ₹3,600 cr in India to expand capacity: CEO
2 min read . Updated: 19 Feb 2023, 02:40 PM IST
PremiumRHI Magnesita has used a portion of the ₹3,600 crore capital expenditure to acquire two refractory assets in India, said CEO Stefan Borgas
RHI Magnesita will invest nearly ₹3,600 crore over the next two-three years in India to expand its production capacity and modernise plants, said company's global CEO Stefan Borgas.
RHI Magnesita has used a portion of the ₹3,600 crore capital expenditure to acquire two refractory assets in India, said CEO Stefan Borgas reported PTI.
"We have earmarked a ₹3,600 crore investment in India. This would go towards organic and inorganic capacity expansion and modernisation of the Indian manufacturing facilities," the CEO said, adding that the capital infusion will be through its subsidiary RHI Magnesita India Ltd.
The company is into manufacturing and suppling of refractory products, systems, and solutions for industries such as steel, cement, non-ferrous metals, and glass.
It recently completed the acquisition of Dalmia OCL and the refractory business of Hi-Tech Chemicals for ₹1,708 crore and ₹621 crore, respectively.
The refractory building capacity of the company is at 5 lakh tonnes per annum (LTPA), of which 1.5 LTPA remains unutilised capacity ready to serve the additional requirements of the Indian market, he said.
The company is looking to modernise the newly acquired assets in India by increasing automation and deploying machinery of international standards.
AI (artificial intelligence) and data-driven digital technologies are being brought to India for improved refractory performance as part of its plans, he added.
Refractory is a specialised heat-resistant material used in making cement, steel, copper, aluminium, non-ferrous metals and glass. Due to its special properties, it can handle high temperatures of up to 1,200 degrees, and magnesia and alumina are the key raw materials required to produce it.
Post-acquisition, the share of the company in the domestic refractory industry has increased to 30 per cent, Pramod Sagar, Managing Director of RHI Magnesita India, said.
On his outlook for the sector, Sagar said in India, there is consumption-led growth. The government has announced a steel capacity target of 300 million tonnes. It had also announced an enhanced capex of ₹10 lakh crore in the Union Budget. All this augurs well for the industry.
"Increased infra spend will increase the demand for products manufactured by our consumer industries," he said.