The MP Birla Group flagship, Birla Corporation, plans to enter the construction chemicals and additives market. It will begin test-marketing of its offerings soon.

The demand for construction additives, such as wall putty and waterproofing material, is growing exponentially. Among cement makers, Ultratech has already introduced such products. Some, like JK Cement, have entered select areas such as wall putty.

According to sources, Birla Corp will initially source the products and market them under the MP Birla franchise.

The company believes that since construction additives are sold through the same channels as cement, there’s a synergy between the two businesses.

“Since the company is going for contract manufacturing, the investment towards manufacturing is nil. However, it will incur only operational expenses,” Birla Corp said in a notification to the bourses. The company may consider manufacturing the products if the volumes pick up.

According to a company release, the second phase capacity expansion at the Kundanganj unit of the company (at Uttar Pradesh) will be carried out. A third production line, with an annual capacity of 1.2 million tonnes, will be installed at an expected investment of ₹250 crore. The Kundanganj unit’s current capacity is 2 million tonnes.

For the quarter ended September 30, 2018, Birla Corp reported a near 55 per cent dip in standalone net profit to ₹2 crore, against ₹4.40 crore in the year-ago-period. Total income during the period stood at ₹999 crore.

On a consolidated basis, the company’s net profit increased manifold to over ₹16 crore in Q2 FY19 (₹1.46 crore). Net income saw a 19 per cent jump YoY to ₹1,485 crore.

Cement production during the quarter stood at 30.97 lakh tonnes, compared to 26.84 lakh tonnes in the year-ago-period. Cement sales for the period stood at 30.68 lakh tonnes.

On Tuesday, Birla Corp shares closed at ₹573.85, down by 0.12 per cent, on the BSE.

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