JK Lakshmi Cement plans to spend almost Rs.3.5 billion on rehabilitating the operations of its Udaipur plant. Of the total investment, JK Laskshmi itself will inject more than Rs.1 billion, whereas the rest will be in the form of loans. This spending is part of a Rs.20 billion capital expenditure programme planned for the next 4 financial years, with the immediate goal of almost doubling its capacity to 10 million tpa over the next 2 years. The scheme is moving ahead as planned, and the current capacity stands at around 5.3 million tpa.
The work at Udaipur, which is expected to add 1.4 million tpa to the company’s capacity, was recently sanctioned by the board for Industrial and Financial Reconstruction (BIFR) after the plant had previously been declared ‘sick’, meaning that it made an obvious choice of upgrade project for JK Lakshmi’s mid-term plans to almost double its production capacity. It is expected that the work will be completed by October 2014, said Company Director, Shailendra Chouksey. “The plant will have new equipment and better technology,” he said, adding, "We will get the best technology possible.”
The company is also currently increasing its clinker capacity in Rajasthan from 3.96 million tpa to 4.29 million tpa. "The additional clinker would enable us to further enhance cement production capacity by about 0.5 million tpa," Chouksey said.
The company’s 2.7 million tpa greenfield project at Durg, Chhattisgarh, is expected to begin operations by December next year. Once production is underway, it will represent an increase in JK Lakshmi’s total capacity to about 8.5 million tpa. Therefore, if the rehabilitation project at Udaipur stays on schedule, the company should just about meet its target of 10 million tpa in the next two years.
Adapted from various sources by Jack Davidson.
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