MUMBAI, India — Balkrishna Industries Ltd.'s board of directors has reconsidered a plan to keep open a 32-year-old factory in Waluj, India, and instead will redirect a $45 million investment earmarked for that plant to a new plant built nearby.
The company disclosed the board's decision in its third-quarter financial results, saying the change will help improve the new plant's economies of scale.
The revised investment strategy will result in the production capacity at the newer Waluj plant, which opened in 2021, being boosted to 55,000 metric tons a year, up 83% over the previously disclosed capacity. The older plant will be phased out, but BKT did not disclose a timetable for doing so.
BKT disclosed its intention to build the second Waluj plant in 2018, budgeting $72.5 million at that time for the project.
The additional capacity will boost BKT's overall annual capacity by 7.4% to 360,000 tons, the company said.
BKT has three other plants in India: in Bhiwadi and Chopanki, Rajasthan; and Bhuj, Gujarat.
For the quarter and nine months ended Dec. 31, BKT reported lower earnings on higher sales.