Murugappa Group's global ambition

08 May 2006

The Chennai-based Murugappa Group has ambitious plans to strike out in to the global markets. V Jagannathan reports.

Chennai: It is "mission global" for the $1.6-billion turnover Murugappa Group, a major industrial group based in South India, with a pan India manufacturing presence — 40 manufacturing operations across 12 states — is moving ahead at a relentless pace to ensure that it globalises its operations on schedule.

The group had finalised 2007 for taking all its major operations overseas. However, before venturing abroad, the group wanted to ensure that it would be either the market leader or a strong 'number two' in all its businesses in the Indian market.

To ensure this, the group speeded up its but major restructuring exercise, but a painless one, by exiting some business lines and regrouping others. While the restructuring exercise started in the late '90s, a major part of it was completed only recently. These include:

• Converting the Rs978-crore turnover EID Parry Limited into an exclusively sugar-focussed company by hiving off the fertiliser, pesticides and sanitary ware businesses. (See );
• Floating a separate joint venture with the Spanish group Roca to takeover the sanitary ware business. (See Roca buys into Parryware Glamourooms for €50 million);
• Firming up an overseas collaboration with Singapore's DBS group, which bought into Cholamandalam Investment & Finance Company Limited. The new venture is now Cholamandalam DBS Finance Limited
• Exiting the confectionary business Regrouping investments in group companies. For instance the group brought its investment in its insurance venture Cholamandalam MS General Insurance Company Limited under the Tube Investments Company Limited.