Kajaria Ceramics has agreed to form a joint venture with Vennar Ceramics, a wholly- owned subsidiary of Anjani Portland Cement, to manufacture wall tiles.

The venture will set up a unit at Kaikalur in Andhra Pradesh.

The joint venture, to be called Vennar Ceramics Ltd, will mark the entry of Kajarias into South India with a manufacturing facility.

In the joint venture, Kajarias will have 51 per cent equity, while Vennar will have the rest. It will be a 1:1 debt: equity partnership. The project requires Rs 60 crore investment, said Mr K.V. Vishnu Raju, Chairman and Managing Director of Anjani Group.

“While initial MoUs have been completed, the formal agreement would be signed on April 9. The unit will have a capacity to make 7,000 sq.mt of tiles per day and ready by June. Kajaria wants to expand it to 10,000 sq.mt per day later,” Mr Vishnu Raju told Business Line .

The Hyderabad-based Anjani Cement had initiated its diversification into tiles last year. Vennar Ceramics, a BSE listed entity, has the necessary infrastructure and gas linkage from GAIL for the manufacturing unit.

Its 2.7 megawatt, gas-based power unit meets most of its power requirements.

For Kajaria Ceramics, which is the biggest player in the manufacture of tiles, the joint venture will give access to at least five States, where Anjani Cement markets its brand extensively.

“For us, the project becomes viable and entry faster. Otherwise we would have to build the new brand. The tiles made by the joint venture will have the Kajaria brand,” he said.

Kajaria Ceramics has major manufacturing units in Rajasthan, Uttar Pradesh and Gujarat. It has indicated that it would invest in expansion and diversification into floor tiles later.

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