GMM Pfaudler on the lookout for acquisitions after buying the parent company gives it access to new tech, markets

Mumbai: Process equipment maker GMM Pfaudler is weighing more acquisition and expansion opportunities even as it completes the purchase of its overseas parent, the Pfaudler Group.

The acquisition of the parent will also give GMM Pfaudler entry into multiple new markets that it previously couldn't enter due to non-compete pacts.

“We want to not only be a player in the glass-lined or the anti-corrosion (equipment) space but also in the chemical processing and pharma processing space. So, acquisitions are definitely an important part of our strategy,” Tarak Patel, managing director of GMM Pfaudler, told ET.


“We would definitely look at either adding new technology, a new region or a new market, or even new process innovation that we can sell along with some of our equipment and we believe that we will be doing some more acquisitions in the short term very quickly,” he said.

The India unit will soon start exporting equipment to markets like Southeast Asia and the Middle East, which were until now catered to by Pfaudler UK and Pfaudler Germany, respectively.

Targeting Green Projects
Making industrial equipment for acid recovery, biogas and renewables are some of the areas that it will diversify into beyond making equipment for the pharmaceuticals and chemicals industries, Patel said.

The company recently acquired the technology to make acid-recovery equipment and Patel said that it was close to getting its first order in India.

GMM Pfaudler’s business in India is also benefiting from pharma and chemical companies looking to set up local manufacturing capacities to reduce reliance on China, Patel said.

Pfaudler Inc., USA had acquired a majority stake in Gujarat Machinery Manufacturers renaming the company as GMM Pfaudler. In August, the Indian unit announced that it was buying a majority stake in the Pfaudler Group for $27.4 million from private equity firm Deutsche Beteiligungs AG Fund VI (DBAG). It has received all the regulatory approvals and the transaction is expected to be closed in the next two weeks.

“Future order inflow outlook continues to remain strong, led by continued investments from the pharma and chemicals industry. Order backlog at China and Germany factories stood at 12 months and 14 months respectively, while backlog for Mavag AG stands at CHF (Swiss Franc) 21 million which is the highest in its history,” analysts at JM Financial wrote in a note post an earnings conference call.

Mavag AG is a Swiss subsidiary of the company.

Analysts expect the company to register a compounded annual growth rate of 20% and 33% in profit margin and net profit over FY21 to FY23.