Saint Gobain investing Rs 8,000 crore in India to meet growth targets, aims 10% growth in FY24
The company, which recently acquired stone wool manufacturer Rockwool India and glass wool maker Twiga still has an appetite for inorganic growth
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New Delhi: Saint Gobain India, a leading glass maker and a player in housing solutions business, is investing Rs 8,000 crore in 4-5 years to fund capital expenditure and acquisitions to fuel growth, its chief B Santhanam said.
The company, which recently acquired stone wool manufacturer Rockwool India and glass wool maker Twiga still has an appetite for inorganic growth here. Saint Gobain India, a subsidiary of the French glassmaker, expects around 10 per cent volume and mix-led growth from the Indian market, where it is witnessing a demand surge.
"Saint-Gobain India is performing very well in India in terms of growth, profitability, expansion, sustainability, digital and people talent. All our businesses be it in building and construction or industrial solutions are performing well," Saint Gobain CEO of Asia Pacific and India region and Chairman, Saint-Gobain India, Santhanam said. "We are close to the annualised rate of Rs 13,200 crore... Comparing FY24 to FY23 we will be 8-10 per cent more in terms of growth," he said. He added that India is the third most profitable country in the Saint-Gobain global business.
Over the investments, Santhanam said most of its businesses are undertaking capacity expansion. "What we believe is that in a 4-5-year cycle, we will invest about Rs 8,000 crores with over 90 per cent focused on capex. As our scale goes up, we will re-evaluate our Capex needs," he said. Saint Gobain India is financing the investments through its internal accruals, said Santhanam adding "We are debt-free and have adequate internal funds to fuel our growth appetite."
When asked about outlook for the Saint Gobain's business here, Santhanam said it is "favourable" in the long term as people are investing money in better solutions that combine aesthetics, functionality, comfort, and sustainability. Saint Gobain India offers solutions for facades, partitions, ceilings, and bathrooms; ceramics for infrastructure industries like steel, cement, and aluminium and glazing solutions for mobility.
"Our long-term growth can be two times the GDP growth rate," he said adding there is a "strong appetite" for Saint Gobain's solution for facades, windows, ceilings, partitions, shower enclosures, office, home interiors and construction chemicals. Even in the industrial space, there is a strong demand from auto, auto components, steel, aluminium, glass, and infrastructure industries, he added.
"In most categories, premiumization is the order of the day, be it residential homes, commercial premises, appliances, or cars. Today, the shift to SUVs has doubled the average price realization of the cars. It is the same for residential homes," he said. Moreover, a strong push on infrastructure by the Modi government has led to rapid growth driving demands for construction chemicals that offer sustainable solutions and reduce carbon footprints.
Besides, Saint Gobain India also exports advanced products to the markets of ASEAN, North Asia, Middle East, and Australia, New Zealand from India. “Even if there has been a slowdown of the exports of goods from India, our exports (good and services) have remained steady at 15 per cent,” he said. However, if the asymmetry in duties on glass with select ASEAN countries is removed, Saint Gobain India can do even better, Santhanam added.
