Three companies within the Murugappa Group – Tube Investments, CG Power, and Carborundum Universal – are pursuing growth
strategies that include disciplined capital allocation, expansion of capacity, and strategic investments in areas like
semiconductors, mobility solutions, and electrical equipment.
The Murugappa Group, established in 1900 and based in Chennai, is one of India's oldest and most respected business
groups. Its operations span diverse sectors such as engineering, financial services, agriculture, and mobility
solutions. The group is known for its commitment to strong governance, conservative financial management, and a focus on
long-term value creation. Its portfolio includes market-leading companies such as Tube Investments, CG Power,
Carborundum Universal, Cholamandalam Investment & Finance, Coromandel International, and EID Parry. The group continues
to expand its domestic and global presence through innovation, sustainability efforts and professional management.
**Tube Investments of India Ltd**
Tube Investments of India Ltd (TII), a major engineering and manufacturing company based in Chennai, is a key part of
the Murugappa Group. TII manufactures a wide array of engineered products, including precision steel tubes, automotive
and industrial chains, metal-formed components, bicycles, and other mobility products, managed through divisions like TI
Cycles, Tube Products of India, and TI Metal Forming.
With a market capitalization of Rs. 51,007 crore, Tube Investments of India Ltd saw its shares close at Rs. 2,635.95, an
increase from the previous day's closing price of Rs. 2,575.55.
The company has fully repaid its debt and currently has approximately Rs. 150 crore in investments. Management has
outlined a structured capital allocation framework with multiple priorities. They anticipate core standalone capital
expenditures of Rs. 300 to 400 crore in the coming year to strengthen and expand current operations.
An additional Rs. 300–400 crore is earmarked for growth investments in new sectors like TI Medical and 3xper. The actual
capital deployed will depend on the entry method, with acquisitions or new manufacturing lines requiring larger upfront
investments. Management also stated that they are actively assessing M&A opportunities in related business segments that
could drive further growth, with Rs. 200–300 crore allocated for such transactions. Further funding for TICM is also
being considered, with a decision expected later in the year.
Looking ahead, management projects standalone revenue growth of about 10%, with profit before tax growing at a faster
pace of 12–15%. Recent capacity additions are expected to support near-term growth. The Nashik plant has recently begun
producing cold-rolled strips, and the Phaltan plant commenced commercial production this month. According to management,
these additions provide sufficient capacity for at least the next one to two years, supporting the company's planned
growth without the immediate need for major capacity expansion.
**CG Power & Industrial Solutions Ltd**
CG Power & Industrial Solutions Ltd is an Indian industrial engineering company with a history in designing and
manufacturing power generation, transmission, and distribution equipment, including transformers, motors, switchgear,
and railway signaling products. The company is now focused on strengthening its core electrical products and industrial
solutions businesses, as well as expanding capacity and capabilities in key areas.
With a market capitalization of Rs. 1,05,657 crore, CG Power & Industrial Solutions Ltd closed at Rs. 670.90 per share,
up from its previous close of Rs. 661.65 per share.
The company has made a significant strategic move into semiconductors through its OSAT (Outsourced Semiconductor
Assembly and Test) and design platform. CG Semi marked its entry with the commissioning of the G1 factory near
Ahmedabad, which represents the initial step in building semiconductor manufacturing capabilities. The plant has a peak
capacity of approximately 0.5 million units per day.
The larger G2 plant is currently under construction and is expected to be operational by the end of next year or early
2027, bringing the combined capacity to nearly 15 million chips per day. The project is expected to create around 5,000
direct and indirect jobs in the coming years and is supported by government incentives under the ISM/MeitY OSAT scheme,
with approvals covering FY24–FY29, along with significant central and state assistance.
Axiro, the design side of the business, is progressing as planned. Management anticipates FY26 revenue of around USD 50
million (approximately Rs. 450 crore) and indicates that the business is currently at breakeven. While the consolidated
segment reflects losses due to the investment phase at CG Semi, management has emphasized strong growth plans, including
expanding beyond radio-frequency technologies, continued hiring, and potential acquisitions to scale the platform.
In addition, the board has approved a greenfield capital expenditure of Rs. 748 crore (net of taxes) for expansion in
the Power Systems and Switchgear business. This investment is intended to meet the increasing demand for medium- and
extra-high-voltage circuit breakers, instrument transformers, and GIS products across both domestic and export markets,
thereby strengthening the company’s position in core electrical equipment segments.
**Carborundum Universal Ltd**
Carborundum Universal Ltd, a diversified materials science and engineering firm within the Murugappa Group, specializes
in abrasives, electro-minerals, industrial ceramics, refractory products, and related engineered materials.
The company serves a wide array of industries, including manufacturing, automotive, mining, and infrastructure. With a
global presence that includes operations and exports across multiple continents, Carborundum Universal is a key player
in technical materials and industrial consumables.
With a market capitalization of Rs. 16,262 crore, Carborundum Universal Ltd closed at Rs. 853.95 per share, up from its
previous close of Rs. 850.40 per share. Capital allocation is proceeding as planned, with capital expenditure in the
first half of FY26 reaching Rs. 162 crore, compared to Rs. 124 crore in the same period last year, against a full-year
plan of Rs. 350 crore. Standalone capital expenditure was Rs. 120 crore, versus Rs. 69 crore in the prior period, with
management stating that investments are “progressing as per the plan.”
Key capital expenditure areas include the semiconductor ceramics facility, aerospace and defense ceramics,
high-performance silicon carbide (HP SiC), and thin wheel relocation. Management noted that the majority of investments
are focused on newer growth areas within the portfolio.
Several emerging growth platforms are nearing commercialization with defined timelines. The semiconductor fab equipment
ceramics facility is progressing as planned and is expected to begin contributing from next year. Investments in
aerospace and defense ceramics are on track, with partial contributions expected next year and a more significant impact
the year after, initially focusing on domestic applications such as vehicle and body protection in collaboration with
DRDO and CGCRI. The HP SiC pilot plant is also on schedule, although management indicated a seeding period of
approximately two years before it begins to meaningfully contribute to revenues.
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