Hinduja group company Gulf Oil today decided to demerge its industrial explosives business comprising of packaged explosives, bulk explosives, metal cladding business into a wholly owned subsidiary called IDL Explosives.
Currently, the company has four autonomously managed divisions namely lubricants, explosives, contract mining and real estate.
"Last year the company felt that the business model needs to be reviewed to allow the growth of its various business segments," the company said in a statement to the stock exchanges.
The company said that the market for bulk and packaged explosives has become extremely competitive and requires highly customer centric, cost optimised supply chain. It says that the demerger will help Gulf Oil have a level playing field with competititors who are focused only on the explosives business.
The turnover of the planned demerged business areas last year, was around Rs 220 crore from seven manufacturing plants. Steps for the scheme of the demerger of the business into a wholly owned subsidiary along with necessary approvals are being taken and will be completed over the next few months.
