Aditya Birla Group’s CAPEX Mahotsav

New Delhi: Aditya Birla Group – one of India’s largest conglomerates – has planned to spend almost Rs 82,000 crore over the next five financial years globally. The conglomerate – which makes clothes to beer cans – will spend close to Rs 48,000 crore in India till FY27.

The group has announced capital expenditure for three of its key businesses – Hindalco, Grasim, and UltraTech.

Companies	CAPEX Amount (Rs Crore)	Period	Details	Balance Sheet Position
Grasim	10,000	Till FY25	For Paint business; aims to become the second largest player	Net Cash Of Rs 550 cr
Hindalco India		Till FY27	Brownfield and greenfield rolling mills, aluminum smelters, and an alumina refinery	Net Debt Of Rs 39,100 cr; net debt-to-EBITDA improved to 1.4x from 2.7x
	25,260
Hindalco Novelis	34,500 - 37,500	Till FY27
UltraTech	12,890	Till FY25	Cement capacity expansion of 22.6 MTPA; total capacity to increase to 159.25 MTPA by FY25	Net Debt Of Rs 3,750 cr; net debt-to-EBITDA improved to 0.3x from 0.5x
Total	82,650 - 85,650

(*assuming INR-USD @ 75)

The company will be spending nearly Rs 10,000 crore till FY25 to build its paint business. Earlier it had announced a CAPEX of Rs 5,000 crore but doubled the amount recently. The company aims to become the second-largest paint company in the country. Management, in its conference call, highlighted that industry growth has been higher than original expectations and the market structure is also changing. This prompted the company to accelerate its growth plans for this foray.

The company has announced CAPEX plans not only for its standalone business but also for its subsidiary Novelis. It has planned brownfield and greenfield rolling mills, aluminium smelters, and an alumina refinery.

The management sees strong demand for aluminium from major segments like beverage cans, automotive body sheets, specialities, and aerospace. The supply disruption in aluminium will deepen the deficit and result in higher LME prices through FY23 and FY24.

The country’s largest cement maker plans to get bigger. It announced a CAPEX of Rs 12,866 crore to add 22.6 MTPA capacity. The proposed expansion, along with ongoing CAPEX, would take Ultratech’s cement capacity to 159 MTPA by FY25. The company’s balance sheet appears to be strong with net debt of only Rs 3,750 crore. Its leverage ratio – net debt to EBITDA – improved to 0.3x from 0.5x in FY21