Kesoram Industries, part of the B K Birla group, announced its continued commitment to its loss-making subsidiary, Cygnet Industries Ltd, after the demerger of its cement business. The company plans to engage with its Japanese technical partner, Futamura, as a strategic investor.
Speaking at Kesoram’s 105th Annual General Meeting, chaired by Satish Narain Jajoo, Kesoram CEO P. Radhakrishnan said there are no plans to sell off Cygnet. The focus is on completing the demerger process of the cement business by December this year. Radhakrishnan expressed confidence in Cygnet’s potential to turn around due to its innovative packaging products.
The cement business, which contributed 90% of Kesoram’s revenue, has been sold to UltraTech Cement for Rs 7,600 crore. The sale has received all approvals except from the National Company Law Tribunal (NCLT).
Kesoram CFO Rohit Shah mentioned ongoing research and development to meet Futamura’s requirements. Cygnet’s biodegradable cellulose paper, currently aimed at retail use, is being tailored for industrial packaging as part of Futamura’s global supply chain. Radhakrishnan noted that Cygnet needs a fund infusion of Rs 45-60 crore, which could help the company achieve a turnover of Rs 1,000 crore in the next few years.
