Balmer Lawrie plans to go ahead with its expansion and capital expenditure plan even though the Covid-19 pandemic and the lockdown has affected its business verticals.

The city-based diversified public sector undertaking has a presence in segments such as industrial packaging, greases and lubricants, leather chemicals, refinery and oilfield services, logistics, travel and vacation services.

“Balmer Lawrie spends around Rs 30-35 crore every year as capital expenditure for both modernisation and replacement of old machinery. This year, our target capex is around Rs 35-40 crore. We are setting up a new temperature controlled warehouse in Bhubaneswar that we hope to commission in the last quarter,” said Prabal Basu, chairman and managing director of Balmer Lawrie.

“Going forward in the next two years, we will continue with a capex of around Rs 40 crore per year. We are thinking about expansion in cold chain space and some modernisation of our plants,” he said.

Balmer Lawrie has recorded a profit before tax of Rs 232 crores in 2019-20 as against Rs 280 crores in 2018-19. “The decrease is being attributable to the decrease in the performance of some SBUs, primarily on account of adverse impact of onset of Covid-19 pandemic during the last quarter of the financial year,” Basu said at the company’s annual general meeting on Friday.

He added that despite a challenging first quarter, the company would remain profitable for the rest of the year. The travel and vacation vertical however will take a longer time to recover, he said.