Chairman announces UltraTech Cement CAPEX for new projects

Mr Kumar Mangalam Birla, Company Chairman, discussed the UltraTech Cement’s investment plans at the 14^th Annual General Meeting. A CAPEX of approximately Rs.7,000 crore will go towards expansion projects, brownfield sites and grinding units. This follows the Rs.2,300 crore spent on modernisation CAPEX and a number of projects that were commissioned in FY14, including a 1.6 million tpa cement grinding plant at Jharsuguda, Odisha, and a 10 000 tpd clinker plant and 1.45 million tpa cement grinding facility at the Rajashree cement plant, Karnataka. The cement manufacturer also invested in a number of power projects: 30 MW thermal power plant at the Rawan cement plant in Chhattisgarh; 25 MW thermal power plant at the Rajashree cement plant; 25 MW thermal power plant at the Andhra Pradesh cement plant; 6.5 MW waste heat recovery system at the Awarpur cement plant in Maharashtra.

“The acquisition of the 4.8 million tpa Gujarat Cement Units of Jaypee Cement Corporation Limited, comprising an integrated unit at Sewagram and a grinding unit at Wanakbori at a cost of Rs.3,800 crore, represents a milestone in UltraTech’s growth strategy, strengthening its foothold in the growing western market and bolstering its coastal footprint. With this acquisition the cement capacity of the company stands at 58.8 million tpa in India,” said Mr Birla.

“UltraTech’s installed capacity has been scaled up to nearly 62 million tonnes annually, inclusive of 3 million tonnes overseas. By early 2016 we expect this to scale up to 70 million tonnes when all of your company’s ongoing projects will be fully commissioned. A judicious mix of internal accruals and borrowings have been used for funding the projects.”

UltraTech Cement recently released its results for the quarter ending 30 June 2014 (1QFY15), reporting net sales of Rs.5,649 crore and profit before interest, depreciation and tax of Rs1,264 crore on a standalone basis. During the period, the company sold 11.7 million t of grey cement and clinker and 2.57 lakh t of white cement and wall car putty.

When discussing the outlook for this fiscal, Mr Birla noted: “Even as the outlook in the short-term continues to remain uncertain, I believe, over the long-term demand growth should move up to double digit levels. The growth drivers will be housing and infrastructure.”

Adapted from press release by Louise Fordham

Read the article online at: https://www.worldcement.com/asia-pacific-rim/07082014/ultratech-cement-earmarks-capex-for-new-projects-252/