Adani wouldn’t want to be unnecessarily disruptive: Kumar Mangalam Birla

In a conversation with CNBC TV18, Kumar Mangalam Birla, Chairman of the Aditya Birla Group, talked about the plans of the paints-to-cement group, including a planned capacity expansion of 22 million tonnes for Ultratech cement.

Birla said the cement business has been around for about 40 years, with strong roots across the country, including a widespread network of dealers, vendors and suppliers. Its expansion will continue as planned, he asserted, even after the takeover of Ambuja Cements and ACC by the Adani group. Birla believes the Adani group is a responsible player. “They wouldn’t want to be unnecessarily disruptive,” he says. “And it’s always good to have smart competition.”

As for the group’s entry into the paints business, Birla says the approach will be a little different because the sector has strong incumbents who have been around for many years. “Our mission is to be the second-largest in the next few years,” he told CNBC TV18. India is slowly moving from the unorganised to the organised sector, and the paint industry is also a part of this shift, he noted. Consumption of paint per capita is quite low geographically, but since the onset of the pandemic, people, particularly in the affluent middle classes, want their own spaces, and this opens a very clear path for growth in the business, said Birla.

On distribution, due to the overlap of the paint and cement businesses, Birla says that both these products are distributed through the same channels. Given the fact that distribution is quite a strong factor, he said this gives the group a clear edge.