BirlaNu eyes higher capacity, acquisitions to revive growth

The Delhi-based firm will look to expand manufacturing capacities and pursue inorganic growth opportunities through acquisitions to drive growth. The company has 31 manufacturing plants in the country and two manufacturing plants in Germany and Austria.

“Investing across our product lines such as pipes, construction chemicals, and flooring and focusing on global growth is going to be important,” Avanti Birla, president at BirlaNu, said in an interview. “Hopefully, markets also become better in terms of demand.”

Revenue growth amid losses

In the October to December period, the firm’s revenue grew 3% to ₹805 crore and its losses widened to ₹35 crore from ₹7 crore in the year-ago period. The company is present in the building solutions space, which includes construction chemicals, roofing, flooring, and piping.

The firm’s revenue and profitability fell for two consecutive financial years 2023 and 2024.

“By the time we have closed this year, our volumes in the pipe segment will have grown by 70%. Second, our flooring brand Parador has grown in volumes by about 8-10% in Europe at a time when the markets there have declined by 25-30%,” Akshat Seth, managing director and chief executive officer at BirlaNu.

“There are early tailwinds in different segments so we remain hopeful about growth.”

The company acquired Germany-based Parador in 2018 for ₹687.2 crore to enter the global flooring solutions market. About 40% of the company’s total revenue in the last quarter came from the German brand, which remains a loss-making enterprise. In the last quarter, its losses increased from ₹16 crore to ₹19 crore.

Future outlook

“On profitability, we will have better results in the last quarter of the financial year. Profitability in a market where growth is hard to come by is an absolute priority, and the results of our work are now starting to become visible,” Seth said.

The company is now looking to ramp up the presence of Parador in the country and wants to scale it up quickly to make India one of the top 10 markets for Parador in a short period of time.

The efforts to revive growth come at a time when competition in building solutions is ramping up. The company competes with the likes of Everest Industries Ltd and Ramco Industries Ltd.

As competition ramps up in adjacent markets in the construction space, such as paints due to the entry of Aditya Birla Group, many players like Asian Paints Ltd. are diversifying into the building solutions space to protect growth.

“Entry of big players in the space is actually a good thing because it demonstrates the potential of the market. As the market is a mix of organised and unorganised players, consolidation in favour of organised players will help us,” Birla said.

Stock performance, credit downgrade

BirlaNu’s share price has fallen by over 26% in 2025 compared to a 2% fall in the Sensex. Besides, in a 13 March note, rating agency India Ratings and Research downgraded the bank loans of BirlaNu due to “persistent weakness in HIL’s operating performance and credit profile”.

“The company’s performance is likely to be significantly weaker than its earlier expectations for FY25 given the prolonged weakness in the European business and a weakening in the domestic demand for roofing and building solutions in FY25, resulting in a fall in realisations and profitability,” Sarthak Bhauwala and Sachita More of India Ratings and Research wrote.