Magicrete Building Solutions to set up unit in Tamil Nadu

Targets revenue of Rs 500 cr by FY17

Surat-based Magicrete Building Solutions, manufacturers and distributors of AAC blocks are expanding down South by setting up a manufacturing unit in Tamil Nadu. This unit is expected to be operational by financial year 2015. The expansion plan of the company will take it closer to its target of becoming a Rs 500 crore firm by FY2017, said senior officials of the company. The company that has two manufacturing units-one each in Surat and Delhi—has a total capacity 800,000 cubic meters per year, is the second largest players in the AAC segment. A cubic metre refers to 600 bricks or one AAC block.

“The two centres we have as of now, cater to two regions of the country—North and West. With the third centre we will be able to better handle demand from the Southern India,” said P V S Srikant, Persident marketing, Magicrete Building Solutions.

The company which clocked revenue of Rs 100 crore in FY2013 is aiming to tack its revenue to Rs 500 crore by FY2017. “Globally use of AAC blocks in construction is a norm. In India, where the brick market is estimated to be Rs 50,000 crore, AAC blocks is market is just about Rs 500 crore. Add to this the brick market is completely unorganized,” added Srikant. He further added that AAC market opportunity is expected to be a Rs 5,000 crore market in the next five years.

Though AAC blocks have been available over three decades there are just about 35 operational plants in India, compared to 3,000 in China.

The company that started its operations in 2009 claims to have a market share of 20 per cent, second only to Biltech, an Avantha Group firm. “Other than being cheaper to traditional bricks, AAC blocks also allows saving of up to 15-20 per cent on construction cost,” said Srikanth.

The company which is also planning to set up a manufacturing unit in Mumbai in future, is targeting real  estate development in other areas of Maharashtra. “We work with several players in Pune. The city is one-fourth the size of Mumbai and we are expecting similar demands in Pune. We are also eyeing cities like Kolhapur, Solapur, Nagpur in near future,” he added.

DLF, L&T, Lodha, Shaporji Pallonji, Kalpataru are some of the builders that Magicrete works with. In Pune it has supplied AAC blocks for projects done by Panchshil Reality, and Goel Ganga Group among others.

Other than providing AAC blocks, Magicrete is now moving to become a supplier of end-to-end building materials and prefabricated construction technologies. Six month back the company introduced two more products—MagicBond,  a block joining adhesive and MagicPlast, a single coat gypsum plaster. “About 10 per cent of sand gets wasted at construction site. With MagicBond we are saying the usage of sand will be less and since we provide a complete kit of factory mixed mortar, no jobsite blending ofpowder is required,” said Srikanth.