Aditya Birla Group firm Grasim Industries on Tuesday announced its entry into B2B e-commerce platform for building material segment with an investment of Rs 2,000 crore over the next five years.

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The board of the company in a meeting held on Tuesday "approved a foray into B2B e-commerce platform for the building materials segment", which will primarily focus on MSMEs with the potential to further extend to other relevant categories.

This platform will be operated by a newly recruited leadership team from the digital ecosystem, Grasim Industries said in a statement.

"This investment adds a new high-growth engine with clear adjacencies within Grasim's standalone businesses as also that of its subsidiaries and associate companies," it said.

Grasim Industries' subsidiary UltraTech Cement is the leading manufacturer of cement in the country with an installed capacity of 119.95 Metric Tonnes Per Annum (MTPA) and had last month announced an investment of Rs 12,886 crore (around USD 1.65 billion) to add 22.6 MTPA capacity.

Aditya Birla Group chairman Kumar Mangalam Birla said the foray into B2B e-commerce is yet another strategic portfolio choice as "it crystallises our intent to invest in the new-age, high-growth digital space".

"The building material segment presents a huge scalable business opportunity with a proven path to profitability. With this foray, Grasim would be able to leverage the large B2B ecosystem within the Aditya Birla Group," he said.

The overall building material procurement segment in India has grown at a compound annual growth rate of 14 per cent over the last three years.

"This industry is estimated at USD 100 billion with current digital penetration of just 2 per cent. Grasim's digital platform will address various challenges within the existing supply chain," the company said.

This move will also catalyze the growth of the MSME (Micro, Small and Medium Enterprises) in India and provide an impetus to the government's vision of 'digital India'.

"The company believes that B2B e-commerce is a high growth opportunity with attractive long-term returns and will be highly valued accretive to its stakeholders," said Grasim.

Meanwhile, in a separate filing, Grasim Industries said its board in its meeting held on Tuesday approved the re-appointment of Anita Ramachandran as a non-executive independent director of the company for the second term of five consecutive years with effect from August 14, 2023.

However, the company said the decision would be subject to the approval of the members at the ensuing annual general meeting.