Balmer Lawrie plans Rs 500 crore capex over 3 years

Diversified public sector enterprise Balmer Lawrie & Co Ltd is rolling out a capital expenditure programme of nearly Rs 500 crore over the next three years, driven primarily by an aggressive expansion in its rail, Third-Party Logistics (3PL) and travel footprint, a top company official said on Monday.

Of the total estimated Rs 500 crore outlay, the railway logistics segment will absorb Rs 200-Rs 250 crore, while around Rs 100 crore is allocated towards routine operational capex across other existing verticals: packaging, greases and lubricants, and chemicals, Chairman and Managing Director Adhip Nath Palchaudhuri said on the sidelines of the 109th AGM.

The company is also deploying Rs 50-Rs 60 crore towards expanding its 3PL operations, alongside investments in cold chain facilities and grease and lubricants small packaging units, and introducing new product variants in packaging and travel businesses, he said.

Under its logistics roadmap, Balmer Lawrie aims to scale up its total fleet to 15 railway rakes, from the three currently operated on a lease model.

In a first, the company will directly acquire three rakes, and tenders have been floated for these. In the first phase, a total of seven more rakes will be added to build greater capacity, including through leasing, after securing fresh rail freight business from iron-ore miner NMDC.

“Railway logistics has emerged as a very strong segment for us where we are putting in significant capex. We are right now running three rakes, and we intend to grow much more, aiming to bring that to around 15 rakes,” Palchaudhuri said.

“With one rake typically costing around Rs 20 to Rs 25 crore, acquiring railway assets will account for a major chunk of our Rs 500-odd crore capex over the next few years,” he said.

In the 3PL vertical, the company is establishing a hub-and-spoke logistics network anchored by a central hub at Dankuni, with spokes expanding to locations such as Siliguri, Guwahati and Bhubaneswar to strengthen regional reach.

Beyond logistics, the company is undertaking targeted capex in its grease and lubricants business by setting up small-filling packaging lines across regional units, including newly operational lines in Kolkata, and plans are afoot for the south, to reduce freight costs and expand its retail market presence.

In its core industrial packaging division, where Balmer Lawrie commands a 35 to 37 per cent market share in 210-litre steel drums, expansion capex is being directed towards adjacent product categories, including smaller drums and intermediate bulk containers (IBCs).

Addressing the shareholders at the AGM, Palchaudhuri said the company was adapting its operations to an increasingly volatile global environment, where geopolitical developments and national security considerations were increasingly influencing global trade.

He also mentioned that the company intends to remain diversified as its traditional core philosophy, which offers a natural hedge against unforeseen situations like COVID, when travel slumped but the logistics division leapt, providing a safety net to its financials.

The company is expanding its supply chain touchpoints with greater emphasis on domestic logistics operations, including its new rail logistics and third-party logistics businesses, he said.

Balmer Lawrie’s logistics business already provides integrated supply chain solutions through its network of container freight stations, warehouses and specialised cold-chain facilities.

The company is also aligning its Travel & Vacations business with the growth in domestic tourism. Its tour packages, retail vacations and MICE (Meetings, Incentives, Conferences and Exhibitions) capabilities have been aligned accordingly, Palchaudhuri said.

Domestic tourism has remained a major component of the travel sector, with visits rising nearly 52.7 per cent between January and September 2025, according to the company.

The chairman said Balmer Lawrie was seeking to strengthen its resilience by catering to these areas of domestic economic activity rather than being solely exposed to disruptions in global trade.

Technology is another key focus as the company enters its 160th year. The chairman identified the company’s long legacy of resilience, alignment with national priorities and adoption of technology as the three defining features of its next chapter.

In 2025-26, the diversified company registered Rs 2785 crore in revenue, which could double by 2030, the company had projected earlier.

In its other businesses, the chemicals division recorded its highest-ever turnover and profit in 2025-26, while the Industrial Packaging business continued technological upgradation across its six manufacturing plants. The Greases & Lubricants business is also working on eco-friendly and synthetic lubricants.

The company’s travel and vacations division recorded a 25 per cent increase in registrations on the exclusive central employee travel portal, while ticketing volumes grew 15 per cent year-on-year and its vacations, retail and MICE divisions recorded their highest-ever gross toplines.

Balmer Lawrie’s approach comes against the backdrop of the Gulf crisis, rising global tariff protectionism and disruptions to established supply chains, which the chairman said had made uncertainty the “new normal”.