Carborundum Universal Ltd Share Price

History of Carborundum Universal Ltd

Carborundum Universal Limited, which is known by its acronym CUMI, is a largest high alumina ceramic manufacturing company in India. CUMI manufactures and sells mainly Abrasives, Ceramics (Industrial Ceramics, Refractories) and Electrominerals. It manufactures a comprehensive product range which includes, Bonded, Coated, Super Abrasives, Ceramics, Electrominerals and Coolants for a wide spectrum of industries. Carborundum Universal Limited was incorporated in April , 1954 as a joint venture between Carborundum Company, USA, Universal Grinding Wheel Company, UK and Murugappa Group, India. Within ten year, they acquired a coated abrasives facility from Ajax Products Pvt. Ltd. and set up a bonded abrasive facility at Thiruvottiyur in Chennai and bauxite mining in Bhatia. In the year 1978, ... the company acquired the Eastern Abrasives Ltd., which is a coated abrasives manufacturer in Kolkata. In the year 1982, the company established MMTCL as a joint venture company with Morgan Group plc for manufacturing ceramic fibres. The company had collaboration with Wendt GmBH of Germany, Morgan Crucible Co, UK, and also a Joint venture in Australia for the supply of wear resistant ceramics to coal washeries. The industrial ceramics division was started in the year 1991 in technical collaboration with Coors Ceramics, USA and the manufacturing plant is located at Hosur in Tamil Nadu. During the year 1994-95, in order to augment infrastructure facilities, the company commissioned a 2 MW wind farm at Perungudi, Tamilnadu. Cutfast Abrasive Tools Ltd, Eastern Abrasive Ltd, Cutfast Polymers Ltd and Carborundum Universal Investment amalgamated with the company with effect from April 1, 1997. During the year 1999-2000, the company set up a 5 MW natural gas based thermal power plant in Tiruvarur with an outlay of Rs 16 crore. In March 2002, the company commissioned the cloth processing facility at Maraimalainagar in Tamil Nadu. Sterling Abrasives Ltd, which is engaged in bonded abrasives business, and SEDCO, which operates a 5.5 MW natural gas based thermal power plant in Tamil Nadu became the subsidiary of the company with effect form March 31, 2003. During the year 2003-04, the company acquired 51% stake in CUMI Australia Pty Ltd. During the year 2004-05, the company established state-of-the art facilities for certain product lines in their Tiruvottiyur and Pallikaranai plants and also they installed new kilns in their Hosur industrial ceramics plant and the Ranipet super refractories plant. During the year 2005-06, the company set up a 100% subsidiary with the name CUMI Middle East FZE in Ras Al Khaimah, UAE to promote exports in the region and also in February 2006, they set up a 100% subsidiary in Canada, CUMI Canada Inc and acquired the business of a coated abrasive supplier, Abrasive Enterprises Inc at an investment of 2.25 million Canadian Dollars. In October 2006, the company acquired 48.7% stake in Sanhe Yanjiao Jingri Diamond Industrial Company Ltd, which is engaged in the manufacture of synthetic diamond grits, which serves as a raw material for super abrasives. The coated abrasive plant at Sriperumbudur in Tamil Nadu commenced their production in December 2006. During the year 2006-07, the company consolidated their coated abrasive back-end operations of cloth processing and polymer manufacturing at Maraimalai Nagar near Chennai. In order to strengthen their position in the monolithic market, the company acquired two industrial units at Jabalpur, Madhya Pradesh, one, which manufactures monolithic refractories and the other high quality refractory cement, which is an input for monolithic refractories. Also they completed the first phase expansion of silicon carbide during the year. Prodorite Anticorrosives Ltd, a wholly owned subsidiary of the company merged with the company with effect from April 1, 2007 which is engaged in the business of acid resisting cements, corrosion resisting products, polymer concrete and fibre reinforced plastics. Also, the company set up a 100% subsidiary in Cyprus, CUMI International Ltd with an investment of nearly Rs 100 crore. CUMI International Ltd acquired 86% stake in Volzhsky Abrasive Works, Russia, which is ranked as the world's second largest silicon carbide manufacturer, with an installed capacity of 65,000 tons per annum. In November 2007, CUMI acquired the engineered ceramic business of IVP Ltd in Aurangabad to strengthen their presence in the high alumina ceramics business. During the year 2007-08, the company commissioned a modern 2000 tonne facility for resin bonded abrasives and a 1000 tonne vitrified bonded abrasives plant and also they spent Rs 1030 million for the greenfield / brownfield expansions, new product and technology upgradation projects. They set up new automated plant at Hosur for manufacturing wear resistant liner tiles at a cost of Rs 318 million. In July 2008, the company entered into an agreement with Foskor (Proprietary) Ltd, South Africa to acquire 51% equity stake in Foskor Zirconia (Proprietary) Ltd, Phalaborwa, South Africa, which is engaged in the manufacture of zirconia and fumed silica. Carborundum Universal incurred capital expenditure of Rs.442 million in 2009-10, with investment primarily in establishment of the facility for manufacture of Silicon Carbide microgrits, which was at an advanced stage of completion in the Cochin Special Economic Zone, as of the year- end. Apart from the new investments, the company made considerable progress in getting the desired benefits from the various capital expenditure projects commissioned in the past few years. In the Abrasives business division, the company established manufacturing capability for a new range of products viz. rice polishing wheels, ultra thin sleek wheels and cup wheels during the year to meet the emerging market requirements for these products. The Hosur bonded abrasives plant achieved 'self certification status' from a major customer. The plant received the certification under the revised standard ISO 9001:2008. One man and one machine was implemented in a module to improve productivity. For the Power tools division, it was a year of internal consolidation and realigning the business strategy based on an understanding of the market gained during the first 18 months of operations. Product lines were critically reviewed and rationalized both based on the market response and also an assessment of the company's strengths in various segments. Marketing efforts were also focused on specific areas and markets rather than dispersing efforts over a wider area. In Ceramics business division, the process of seeking product approvals which began in 2008-09 paid rich dividends and orders were secured from major global manufacturers of vacuum interrupters. Focused approach on timely delivery coupled with reliable products helped the division to win best new supplier award from a global leader in vacuum interrupters. During the year under review, new products were developed to address corrosion and wear protection applications in mining and high thermal shock applications in casting operations. In Super Refractories & Anti-Corosive products business, the company's Jabalpur plant obtained the ISO 9001-2008 certification and received approved vendor status from EIL for supply of products to fertilizer and petrochemical industries. The new facility in Katpadi Taluk, Tamil Nadu for manufacture of 10,000 tonnes of anti-corrosive products obtained EIL's approved vendor status for all anti corrosive products. A new acid resistant product was developed and established to international standards during the year. Construction of a new line for manufacture of non-woven abrasives in the Tiruvottiyur, India plant was completed towards the end of the year. The facility was set up with knowhow from international sources. In the bonded abrasives plant in Hosur, India manufacturing process for new varieties of castable wheels were developed and stabilized. Improved fast firing cycles were introduced in kilns for vitrified products, which will yield benefits in terms of lower fuel consumption. The abrasives plant at Roorkee, India graduated into a reliable source for bonded and coated abrasives addressing the mass-market segment. Production levels were stepped up substantially over last year. In Volzhsky, Russia re-layout of the manufacturing line was undertaken, in certain parts of the facility, to accommodate additional equipment designed to address the market requirements for specific categories of products. In industrial ceramics, the Company continued to pursue its business model of designing and manufacturing ceramic tiles in India and marketing them through the subsidiaries in Australia, Canada, South Africa and lately CUMI China in their respective markets and with other markets being handled directly by the Indian operations. During the year under review, the company was empanelled as an approved supplier by a leading international product licensor of refractories for petrochemical industry. Investments have been made during the year in the silicon carbide fusion facilities in Volzhsky, Russia to enhance efficiencies and upgrade fusion technology. The first phase of the silicon carbide microgrit facility at Cochin Special Economic Zone, India commenced commercial production in April 2010. CUMI America, CUMI Canada and CUMI Middle East became subsidiaries of CUMI International Cyprus during the year. During the financial year ended 31 March 2014, the implementation of the Total Productive Maintenance (TPM) program at the company's Abrasives business division, started in 2012-13, was extended to other facilities. The Ceramics manufacturing team launched a series of economy grade tiles for price sensitive market. These tiles were used to compete against low cost competition. In the Fused Minerals operation in South Africa, which was acquired during the second quarter of 2012-13, the process of ramping up the operation continued during the year. In Russia, the Silicon Carbide fusion facility registered highest fusion volumes ever. In Cellaris Refractories India Limited, the plant for manufacture of Ceramic foam was commissioned during the last quarter of the year. During the year under review, CUMI International Limited, which holds majority stake in overseas subsidiaries, infused fresh funds to support operations in China, America, Canada and South Africa. During the financial year ended 31 March 2015, introduction of high performance grains from the company's captive Electrominerals facility helped fuel revenue growth of the company's Abrasives business. Coated products delivered a significant growth on the back of better exports and launch of technical products. In Non-Woven business, the focus during the year was on increased participation in the industrial segment and development of new products. Significant number of value projects, tailored to meet cost reduction through improvement in material efficiencies, energy cost reduction, labour productivity improvements and maintenance efficiencies were undertaken and completed during the year. The Abrasives business division achieved a significant milestone in Total Productive Maintenance (TPM) journey, which commenced in 2012-13. TPM initiatives have helped in enhancing equipment effectiveness, debottlenecking various constraints in the production process thus releasing additional capacity and reduction in lead time of production. The Coated business has significantly benefitted from this initiative resulting in growth in profit. In Ceramics business division, debottlenecking projects in metallized plant led to release of capacity in the existing facility. The Refractories division commissioned the alternative fuel fired tunnel kiln, which is expected to give a cost saving. In view of the increasing input costs and considering future viability, it was decided to wind down the operations in Thukela Refractories Isithebe Pty Ltd., South Africa. Considering the decision taken to wind down operations, the fusion plant operations of Thukela Refractories, were mothballed. The two furnaces meant for fusion will be relocated to Edapally plant in India. In 2014, Carborundum Universal inaugurated a production line for making new line of Engineered Ceramics parts. In Russia, the Silicon Carbide fusion facility registered highest fusion volumes ever. The Russian entity continued to flex its manufacturing process to generate more metallurgical products to serve its domestic market. In Cellaris Refractories India (CRIL), the stabilisation process of the plant for manufacture of ceramic foam continued in FY 2014-15. Consequent to the acquisition of remaining shares in CRIL from Cellaris, Israel, this entity became a wholly owned subsidiary of the company during the year. During the year under review, Carborundum Universal, through CUMI International Limited (CIL) set up a marketing subsidiary, CUMI Europe s.r.o, based out of Europe, to serve the European markets better with products and services of CUMI Group. During the financial year ended 31 March 2016, Carborundum Universal's Abrasives business aggressively appointed new channel partners and expanded its dealer network. Retail development and industrial storming initiatives were carried out which gave the necessary mileage. Emphasis was given on the core business with introduction of new products and brands in the Vitrified standard range and select Resinoid ranges. New technically advanced products were launched in bonded non-standard space. Successful realisation of the synergy effect of consolidation of Super Abrasives and Power Tools gave higher growth in those product segments. In Coated products, the business aggressively targeted new territories through new product launches, upgraded select products to international benchmarks and targeted Tier II and Tier III segments. With regarding to manufacturing, the Abrasives division's key strategy over the years has been to increase the indigenous sourcing and lowering the gap between exports and imports to ensure sustainable profitability. Key initiatives undertaken during the year towards fulfillment of this strategy were commencement of techno commercial projects to sustain cost reductions, joint projects with Electrominerals division, identification of alternate suppliers and business partnering with key suppliers. The Industrial Ceramics division was able to tide over the challenges of deferment in schedules from select customers by adding new customers and augmenting the customer basket. The Domestic Wear Ceramics business strengthened relationship with Original Equipment Manufacturers (OEM) from non-power sector. The Industrial Ceramics division was able to successfully complete the debottlenecking project in Metallized business resulting in increasing the current capacity to 1 million cylinders per annum. In Russia, in order to provide the required level of quality and production volume, the Silicon Carbide processing plant commissioned a crushing complex which is now operational. This has enabled the plant to introduce various grit sizes in the market. The merger of Carborundum Universal's wholly owned subsidiary Cellaris Refractories India Limited with the company was completed during the year. During the year, consequent to the consolidation of its operations with CUMI America, CUMI Canada was legally wound up and hence ceased to be a subsidiary of the company. The Madras High Court sanctioned and confirmed the Scheme of Amalgamation of Carborundum Universal's wholly owned subsidiary Cellaris Refractories India Limited (CRIL) with the company effective from the appointed date 1 April 2015. During the financial year ended 31 March 2017, Carborundum Universal's Coated Abrasive business registered good growth in the conventional products in domestic market. The growth came about by way of launch of new products, focus on technical products, strong brand recall and dealers' readiness to invest in this product segment and quality consistency of the products. In order to cater to increased demand for Coated products, the division pursued capacity expansion projects in Maraimalai Nagar to ensure feed with higher width across all product ranges in cloth and paper to Sriperumbudur Coated facility. The entity in Russia completed the up-gradation of bond production facility in vitrified Abrasives area. New products like high-porosity Bonded Abrasives were introduced to the local markets during the year. In Ceramics business, new products like Tap Hole Clay and Slide gate faced delays in customer acceptance. The Industrial Ceramics division accomplished important business milestones during the year. A new state-of-the-art Research and Development facility (DSIR approved Lab) was inaugurated during the second quarter of the year with advanced characterisation and research facilities. The new Metallized Cylinder manufacturing line with assets from NTK, Japan was set up and the commissioning is likely to commence during early 2017-18.During the year, the business was able to qualify as partner with OEM's for the new products launched. In Electrominerals business division, the relocated facilities from South Africa were commissioned in Cochin, India in March 2017. The new Zirconia Bubble Fusion Plant and the two Alumina Fusion Plants will result in creation of one of the most advanced and integrated Electromineral complexes in the world. The new facilities will add, at full capacity, about 25,000 tons of fused minerals generation Capital expenditure during the financial year ended 31 March 2017 across all geographies was majorly in the nature of capacity additions besides automation, quality enhancement, line balancing and general infrastructure.During the financial year ended 31 March 2018, Carborundum Universal's Coated Abrasives business continued to register good growth in the conventional products in domestic market. The growth came about by way of launch of new products, focus on technical products, strong brand recall and dealers' readiness to invest in this product segment as well as quality consistency of the products. The business during the year launched breakthrough products in this category. During the year, the business aggressively appointed new channel partners and expanded its dealer network both in India and abroad. Retail development and industrial storming initiatives were conducted for better market penetration. Introduction of newer industrial products were pursued during the year which were sold through industrial distribution chain. On the manufacturing front, the business continued to focus on pursuing dual strategy - firstly, of moving from traditional Brown to Semi-friables to gain significant competitive advantage; secondly, of offering superior Coated technical products with high performance Zirconia and Ceramic grains. In order to cater to increased demand for Coated products, the division pursued contract manufacturing. The Non-standard business was engaged in productivity improvement for customers with continued slew of new product launches. The division worked on various research and development opportunities in the field of precision grinding, 3D printing, light metal grinding etc. During the year under review, the company's ceramics business established entry into Japanese markets through qualifications at OEM's for supply of Ceramic lined bends. New products with backing materials were developed for addressing high impact applications. The new Metallized Cylinder manufacturing line with assets from NTK, Japan was commissioned and the production commenced during the year. On the manufacturing front, the division could implement multi-cavity mould for near net shape moulding and commissioned Ceramic Injection Moulding line. In-house raw material was produced for Engineering Ceramics and Metallized Ceramics product enabling a better grip on the quality and the timely availability. Third production line for base level Ceramics contract manufacturing was established during the year enabling the business to cater to higher volume requirements from the customer. The fine powder business of Silicon Carbide at Kakkanad, Kerala carried under the Electrominerals business division has seen renewed heights with one of the world's largest manufacturer of Diesel Particulate Filter approving the fine powder for their requirement. The relocated Alumina facility from South Africa scaled up and delivered the products as per the market requirements. The modernised Alumina plant with efficient furnace system gave the business the advantage of producing high end variants of Alumina. The shortage of availability and hike in raw material prices - Zircon sand and Electrode affected the scaling up of operations of relocated Zirconia Bubble facility, situated in India. The South African subsidiary, Foskor Zirconia which is into production of Monoclinic Zirconia was also affected due to volatile input pricing. Carborundum Universal's capital expenditure during the financial year ended 31 March 2018 across all geographies was majorly in the nature of quality enhancement, line balancing and general infrastructure. Investment in mutual funds as on 31 March 2018 was Rs 544.79 million. In FY'21, the Company commissioned a continuous Metallization furnace at the Metallized Ceramics Plant, Hosur, as part of METZ 2.5 Project, in Metallized Cylinders for Vacuum Interrupters. The project was executed between overseas supplier providing virtual support and the IC team commissioning the furnace and completing the validation. It started work on the second Plant for Lined Equipment of the Ceramics business at Hosur. The facility for manufacturing Sintered Silicon Carbide (SSIC) Ceramics was commissioned at Hosur during the year. The furnace, which was equipped with IoT enabled process systems and high temperatures was installed and commissioned through remote monitoring. The Electrominerals business expanded the capacity of White Fused Alumina Plant at SEZ, Kakkaned, to 12,000 TPA, through process optimisation and efficiency improvements. Electromineral Plants at Edappally and Volzhsky Abrasive Works, Russia (VAW), was undertaken to maximise efficiencies and enhance productivity. It expanded capacity of Nitride Bonded Silicon Carbide facility at VAW, in Russia. A Gas plant was commissioned at VAW, Russia, for purification of exhaust gases and to neutralize the emissions from operations. The Prodorite business added a new plant at Serkadu for manufacture of Nacelle Cover for Wind Turbines for the green energy segment. Manufacturing of Composite Rebars for high corrosive and reinforcement applications was started during the year. A similar transitioning was planned for continuous operations at the Bonded Abrasives plant, in Hosur. Leveraging the proximate positioning of two Plants to each other, and combining their requirement, a Gas Supply Agreement (GSA) was signed with GAIL in February 2019 for dedicated pipelines to the two Plant. The Refractories business developed and introduced Feeder Channels to expand Container Glass industry across the globe. The Abrasives business added innovative range of products to create application specific products that enhance efficiencies, reduce downtime and provide superior quality output. A Surface Technology Centre for Coated Abrasives was created at Sriperumbudur, equipped with proto type machines and a simulation lab to provide for experiential training and product testing for painters and carpenters. During the year 2022, the Company acquired the main assets of AWUKO Abrasives Wandmacher Gmbh & Co. KG, in Germany effective on 1st February 2022. The Abrasives business of RHODIUS Group was acquired in 2022. During the year 2023, the business commissioned an energy efficient fiber lined high temperature kiln that increased the capacity of fired products by 1200 MT. The Company acquired the assets, technology & brand of DRONCO in Germany in FY24. In FY 2025, Company's Ceramics Business commissioned a Tunnel Kiln for Engineered Ceramics, with high levels across Metallised Cylinder lines, and activated fullscale ramp up of new kilns and screw presses for high-alumina Refractories. The Company launched India's first coupling agent for PC/ABS alloys in the automotive sector through the Polymer division. The Electrominerals business established graphene for auto detailing applications, by commencing the plant scale operations. In the Refractories and Composites, the business has developed and implemented customised monolithic products, including various gunning materials, self-flow Castables, and precast shapes for rotary kilns in the Grate Kiln process. The business made major strides in new product development, such as enhancing fired refractory and castable materials for the Glass industry and producing large blocks for glass tank bottoms through pressing.