Captains Speak

Published: Dec 29, 2021
Updated: Dec 29, 2021

EPC orders highest in 25 years

Century Textiles and Industries, a BK Birla group company with a 123-year-old legacy, has a wide presence in paper and pulp (which contributes around 70 per cent of revenues), textiles (23 per cent) and real estate (6 per cent). It is now diverting its focus to real estate and has lined up Rs 1,000 crore for capex for the current fiscal year. Interestingly, this capex is almost nine times the allocated amount for the other two businesses.

JC Laddha, Managing Director, says Birla Estates, the real estate vertical of the company launched in 2016, has a valuable portfolio of land parcels cushioning the price impact and making the business more attractive in the context of the massive cost of land in the cities the company is focusing on – Mumbai and its suburbs, Delhi NCR, Bengaluru and Pune.

Maintaining that “we have set aside a sizeable amount in capex for the Birla Estate vertical this fiscal and going forward,” Mr Laddha adds, “Our main focus will now be on real estate and we want to be among the top five players over the next 3 to 5 years.”

In fact, he says, “The real estate business has clocked an excellent performance in fiscal 2021, buoyed by strong sales at all our launched projects — Birla Vanya at Kalyan, Birla Alokya at Bengaluru and Birla Navya at Gurugram. The first quarter saw the industry come to a grinding halt with the countrywide lockdown. The reiteration of the importance of home ownership due to the pandemic, record low interest rates and government support to the sector led to the revival of residential demand in the remaining quarters. We achieved sales in terms of booking value of Rs 621 crore with a growth of 34 per cent yoy.”

PROJECTS SOLD OUT

Though the company deferred the launch of its premium residential project at Gurugram-NCR, named Birla Navya, to October 2020, the project met with an overwhelming response. Likewise, phase-I of the Kalyan project in Maharashtra, Birla Vanya, got booked over 95 per cent in terms of booking value, while Birla Alokya, Bengaluru also witnessed strong sales during the year.

Mr Laddha says with confidence, “We have a strong pipeline of upcoming new projects in Mumbai and Bengaluru, and new phases at Birla Vanya, Kalyan and Birla Navya, Gurugram.” Elaborating on the reasons for this success, especially during these challenging times, he points out that “at Birla Estates, we deployed advanced technology to provide improved services to our existing and potential customers. We created a platform for 360- degree virtual and guided tours and upgraded the WhatsApp-based chatbot LIDEA. Our digital system for tracking and responding to customer queries helped our relationship managers deliver solutions in a timely manner.”

Commenting on Century Pulp and Paper – the major contributor to the company’s revenues — Mr Laddha says, “Our pulp and paper business witnessed high volatility during the year. Products such as board and tissues witnessed heightened demand from pharmaceutical and FMCG customers due to the pandemic. At the same time, the demand for writing and printing paper decreased as educational and other institutions remained shut. The turnover contracted by over 26 per cent from Rs 2,383 crore to Rs 1,774 crore.”

He adds, “Reacting with agility to the situation, the company increased its tissue-making capacity by 100 per cent by expanding with a new plant. To service the growing demand for tissues, we have invested Rs 100 crore in capacity upgradation over the last few years. Additionally, the company also decided to utilize its idle capacity of writing and printing paper to cater to the demand for other products like packing boards.”

Under the pulp & paper division, the company has four major products — writing & printing paper with 550 tpd capacity, multi-layer packaging board with 500 tpd, tissue paper with 200 tpd (Century is the largest and most advanced manufacturer of jumbo soft tissue paper rolls in India) and rayon grade pulp. The latter is a highly purified form of cellulose made from wood and used in a wide variety of consumer applications, including viscose staple fibre, viscose filament yarn and cellophane paper. Its total capacity stands at around 100 tonnes per day. While referring to the textiles business, Mr Laddha says, “Our textiles business was impacted by the pandemic due to the discretionary nature of the product, mostly comprising premium offerings. The revenue contracted by around 21 per cent from Rs 735 crore to Rs 583 crore.”

GREENFIELD PROJECT

The greenfield integrated textile project known as Birla Century, set up in 2008 on 100 acres of land at Jhagadia, Bharuch in Gujarat, has a product portfolio comprising shirtings, bottom weight, fine fabrics and bed linen. It is the world’s second and India’s first LEEDV4-certified textile manufacturing company. Mr Laddha says, “In order to strengthen our offering of world-class products in textiles, during the year the company inked technological collaborations with world leaders like HeiQ, a Swiss innovator, Health Guard, an Australian chemical giant, and Gencrest, a supplier of patented green technology for the development of greener and sustainable fabrics. The company is now focusing on margin-accretive products and exports. It is also planning to expand its footprint in the US hospitality sector, with emphasis on the made-up segment.”