KOCHI: Kerala Minerals and Metals Ltd (KMML) is embarking on an expansion plan aimed at increasing its titanium dioxide (TiO₂) production capacity from the current 40,000 metric tonnes per annum to 60,000 MT initially, with a longer-term target of 1,00,000 MT.
While the project stands to benefit from KMML’s experienced management and a largely standardised and automated production process, it is still exposed to implementation risk, pending a final go-ahead from the Government of Kerala, according to sources.
KMML, once considered one of Kerala’s most reliable PSU cash cows, is now grappling with shrinking profits and mounting competitive pressures.
KMML reported a net profit of Rs58.55 crore in FY24, down from Rs85.04 crore in FY23 — and a sharp fall from the post-pandemic peak of Rs310.5 crore in FY22. The FY22 performance was driven by favourable global pricing, strong export demand, and limited competition due to supply chain disruptions — conditions that have since normalised, putting margins under pressure.
The state-owned company, which manufactures titanium dioxide and titanium sponge, is now investing in plant upgrades and exploring adjacent segments such as medical-grade titanium and value-added titanium products. These moves are intended to future-proof operations and diversify revenue streams.
It has also outlined capital expenditure plans to strengthen its presence in both domestic and export markets.
Although KMML’s topline has remained relatively steady, the weakening profit trend indicates its inability to replicate the extraordinary performance of FY22. Key challenges include rising input costs, stiff global competition, and muted price realisations in the titanium pigment segment.
To support its investments, KMML is raising funds via non-convertible debentures (NCDs), rated ‘IND A+’ by India Ratings and Research. The rating agency highlighted KMML’s strategic importance, government backing, and stable operations as positives, while also flagging that timely state support would be crucial if cash flow pressures intensify.
Analysts say KMML’s expansion efforts could pay off over the medium to long term, but stress that near-term priorities should centre on operational efficiency and cost control, especially as internal accruals weaken.
KMML remains one of Kerala’s key industrial public sector undertakings — and a rare player in the titanium dioxide space. But unless the expansion delivers results soon or market conditions improve significantly, the company could struggle to return to its FY22 profitability levels.
