Chennai, June 11 (IANS): Diversified industrial conglomerate Murugappa group will be investing around Rs.250 crore in its business ventures this fiscal on capacity expansion and on technology, said a senior official.

He said the group is in talks with the Japanese partner Mitsui Sumitomo Insurance group for the latter to increase its stakes in the insurance joint venture.

"Our capital expenditure for this fiscal will be around Rs.250 crore - similar to what we had invested last year. The investment will go in capacity expansion and technology," vice chairman M.M.Murugappan told reporters here on Thursday.

Bulk of the investments - Rs.90 crore - will go into the new 1.5 million units per annum cycle factory coming up in Punjab, he said.

Group company Tube Investments of India Ltd rolls out cycles.

The balance amount will be invested in other group companies.

According to Murugappan, talks are on with Mitsui Sumitomo group on allowing the latter to increase its stakes in the group's insurance company Cholamandalam MS General Insurance Company Ltd.

"The law permits foreign partners to hold up to 49 percent stakes in the insurance companies. But there is no compulsion on the Indian partner to allow the same. The company is doing well and there is no urgent need for funds," said the Murugappa group's director, finance, N.Srinivasan.

According to him, as and when the talks conclude, the Murugappa group may offload part of its stakes in favour of the Japanese partner.

Looking back at the fiscal that went by, Murugappan said it was a difficult year but the group focussed its energies on consolidation and operational efficiencies.

While the group logged 11 percent growth in its total turnover at Rs.26,926 crore the profit before tax went up by 26 percent. According to Srinivasan, the cumulative market capitalisation of the group's listed companies at the end of last fiscal stood at Rs.30,974 crore up from Rs.20,502 crore as on March 31, 2014.

Queried about the status of the sugar refinery plant of E.I.D. Parry (India) Ltd, Murugappan said the plant at Kakinada in Andhra Pradesh is operational after the installation of coal-fired boilers.

The refinery is expected to process 400,000 tonnes this fiscal.

Murugappan said the devaluation of the rouble had impacted group company Carborundum Universal Ltd's subsidiary in Russia.