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Cement players look at east India for growth

Of the cement national production of 300 million tonnes (mt) per annum, the contribution of east India with 55 mt capacity is 17-18 per cent

Avishek Rakshit  |  Kolkata 

Cement players look at east India for growth

Emami’s foray into the space, Nirma’s entry into the segment after the buyout of India’s 11-million tonne (mt) business, and Cement’s proposed investments have laid the ground for players eyeing more revenues from east India. 

According to H M Bangur, managing director of Cement, while the industry nationally will grow by five per cent this year, the growth in east India will be 10 per cent, which will make this region a key priority for the players.

Of the national production of 300 million tonnes (mt) per annum, the contribution of eastern region with 55 mt capacity is 17-18 per cent.  The national capacity at the moment is 370 mt per annum. With demand expected to scale up to 600 mt over the next 10 years, the capacity would need to be at least 700 mt, Bangur added. 

“In the east, consumption is lower than the national average. This situation will change as the capita consumption of in the east is likely to increase,” said Bangur, adding that the contribution from the eastern market to the national production will increase marginally this year. 

While Chhattisgarh seems to be the favourite among the players, eyeing the eastern market, thanks to Cement, Cement, and others, Jharkhand, and are also in line. Shree, which has been strong in the northern markets over the past years, is eyeing the eastern zone by setting up plants in Bihar and Chhattisgarh with an investment of Rs 2,000 crore. 

It is also in talks with the government to take up a Rs 600-crore project subject to the availability of limestone and other raw materials. Recently, earmarked Rs 700 crore to step up capacity in its Raipur plant from 2.6 mtpa to 5.4 mtpa. According to Bangur, the enhanced capacity will help the company increase its market share by better streamlining of availability in the markets in Bihar, Chhattisgarh and  

“India is treading on a growth part and there is immense potential in the eastern region especially in roads, construction and real-estate. We want to tap this projected opportunity and hence is going for the expansion mode,” said Bangur. 

Consumer goods major Emami, which has been a late entrant in the space through its group company Cement, has ambitious plans to evolve into a pan-India player, but it is first setting up capacity in the east and central parts of India.

It has set up a four mtpa integrated project consisting of clinkerisation plant and grinding plant at a cost of ~3,000 crore at Risda in Chhattisgarh and is also setting up a Rs 500 crore grinding unit in Panagarh in West Bengal, which will have a two mtpa capacity. Raw material for the Bengal unit plant will be sourced from the company’s captive limestone mines in Chhattisgarh. 

has obtained clearance from the government, too, to set up a 1.5 mtpa plant in Begunia in the state’s Khurda district at an investment of Rs 255 crore. 

With these investments in place, supported by its goal to emerge a national player by setting up plants in and Karnataka, the company expects revenue of Rs 2,500-3,000 crore. “We are also open to acquisitions,” said Aditya V Agarwal, director, the Group of  

Similarly, Burnpur Cement, which is on the lookout for a larger market share, is also planning to invest Rs 500 crore for expansion of its production capacity to 3 mtpa in its plant in and another one in Patratu district in These plants have a 0.3 mtpa installed capacity each. A plan to build a two-mtpa project in is also under consideration. 

Birla Corporation, too, has ambitious plans to make it big across the eastern and northern markets. With operations in in Madhya Pradesh, in Rajasthan, in and in Uttar Pradesh, the company like its peers wants to gain market share in the eastern space. 

has marked its presence in the eastern market after acquiring Lafarge’s plants in and for ~9,478 crore. Production from these plants caters to the needs of the eastern market. According to an analyst with Motilal Oswal, the government’s infrastructural push will lead to higher uptake of In the past three months, the shares of eastern have also shown an upward trend highlighting market confidence.

While Cement’s prices shot up from Rs 13,426.9 apiece as on May 30, 2016 to Rs 16,924.05 as on August 29, 2016, Birla Corporation’s share prices went up from Rs 418 per share to ~659.45 in the same time frame. Burnpur also showed an upward trend as its prices headed north to Rs 14.65 as on August 29, 2016 in comparison to Rs 9.41 apiece three months ago.

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Cement players look at east India for growth

Of the cement national production of 300 million tonnes (mt) per annum, the contribution of east India with 55 mt capacity is 17-18 per cent

Of the cement national production of 300 million tonnes (mt) per annum, the contribution of east India with 55 mt capacity is 17-18 per cent
Emami’s foray into the space, Nirma’s entry into the segment after the buyout of India’s 11-million tonne (mt) business, and Cement’s proposed investments have laid the ground for players eyeing more revenues from east India. 

According to H M Bangur, managing director of Cement, while the industry nationally will grow by five per cent this year, the growth in east India will be 10 per cent, which will make this region a key priority for the players.

Of the national production of 300 million tonnes (mt) per annum, the contribution of eastern region with 55 mt capacity is 17-18 per cent.  The national capacity at the moment is 370 mt per annum. With demand expected to scale up to 600 mt over the next 10 years, the capacity would need to be at least 700 mt, Bangur added. 

“In the east, consumption is lower than the national average. This situation will change as the capita consumption of in the east is likely to increase,” said Bangur, adding that the contribution from the eastern market to the national production will increase marginally this year. 

While Chhattisgarh seems to be the favourite among the players, eyeing the eastern market, thanks to Cement, Cement, and others, Jharkhand, and are also in line. Shree, which has been strong in the northern markets over the past years, is eyeing the eastern zone by setting up plants in Bihar and Chhattisgarh with an investment of Rs 2,000 crore. 

It is also in talks with the government to take up a Rs 600-crore project subject to the availability of limestone and other raw materials. Recently, earmarked Rs 700 crore to step up capacity in its Raipur plant from 2.6 mtpa to 5.4 mtpa. According to Bangur, the enhanced capacity will help the company increase its market share by better streamlining of availability in the markets in Bihar, Chhattisgarh and  

“India is treading on a growth part and there is immense potential in the eastern region especially in roads, construction and real-estate. We want to tap this projected opportunity and hence is going for the expansion mode,” said Bangur. 

Consumer goods major Emami, which has been a late entrant in the space through its group company Cement, has ambitious plans to evolve into a pan-India player, but it is first setting up capacity in the east and central parts of India.

It has set up a four mtpa integrated project consisting of clinkerisation plant and grinding plant at a cost of ~3,000 crore at Risda in Chhattisgarh and is also setting up a Rs 500 crore grinding unit in Panagarh in West Bengal, which will have a two mtpa capacity. Raw material for the Bengal unit plant will be sourced from the company’s captive limestone mines in Chhattisgarh. 

has obtained clearance from the government, too, to set up a 1.5 mtpa plant in Begunia in the state’s Khurda district at an investment of Rs 255 crore. 

With these investments in place, supported by its goal to emerge a national player by setting up plants in and Karnataka, the company expects revenue of Rs 2,500-3,000 crore. “We are also open to acquisitions,” said Aditya V Agarwal, director, the Group of  

Similarly, Burnpur Cement, which is on the lookout for a larger market share, is also planning to invest Rs 500 crore for expansion of its production capacity to 3 mtpa in its plant in and another one in Patratu district in These plants have a 0.3 mtpa installed capacity each. A plan to build a two-mtpa project in is also under consideration. 

Birla Corporation, too, has ambitious plans to make it big across the eastern and northern markets. With operations in in Madhya Pradesh, in Rajasthan, in and in Uttar Pradesh, the company like its peers wants to gain market share in the eastern space. 

has marked its presence in the eastern market after acquiring Lafarge’s plants in and for ~9,478 crore. Production from these plants caters to the needs of the eastern market. According to an analyst with Motilal Oswal, the government’s infrastructural push will lead to higher uptake of In the past three months, the shares of eastern have also shown an upward trend highlighting market confidence.

While Cement’s prices shot up from Rs 13,426.9 apiece as on May 30, 2016 to Rs 16,924.05 as on August 29, 2016, Birla Corporation’s share prices went up from Rs 418 per share to ~659.45 in the same time frame. Burnpur also showed an upward trend as its prices headed north to Rs 14.65 as on August 29, 2016 in comparison to Rs 9.41 apiece three months ago.
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Business Standard
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Cement players look at east India for growth

Of the cement national production of 300 million tonnes (mt) per annum, the contribution of east India with 55 mt capacity is 17-18 per cent

Emami’s foray into the space, Nirma’s entry into the segment after the buyout of India’s 11-million tonne (mt) business, and Cement’s proposed investments have laid the ground for players eyeing more revenues from east India. 

According to H M Bangur, managing director of Cement, while the industry nationally will grow by five per cent this year, the growth in east India will be 10 per cent, which will make this region a key priority for the players.

Of the national production of 300 million tonnes (mt) per annum, the contribution of eastern region with 55 mt capacity is 17-18 per cent.  The national capacity at the moment is 370 mt per annum. With demand expected to scale up to 600 mt over the next 10 years, the capacity would need to be at least 700 mt, Bangur added. 

“In the east, consumption is lower than the national average. This situation will change as the capita consumption of in the east is likely to increase,” said Bangur, adding that the contribution from the eastern market to the national production will increase marginally this year. 

While Chhattisgarh seems to be the favourite among the players, eyeing the eastern market, thanks to Cement, Cement, and others, Jharkhand, and are also in line. Shree, which has been strong in the northern markets over the past years, is eyeing the eastern zone by setting up plants in Bihar and Chhattisgarh with an investment of Rs 2,000 crore. 

It is also in talks with the government to take up a Rs 600-crore project subject to the availability of limestone and other raw materials. Recently, earmarked Rs 700 crore to step up capacity in its Raipur plant from 2.6 mtpa to 5.4 mtpa. According to Bangur, the enhanced capacity will help the company increase its market share by better streamlining of availability in the markets in Bihar, Chhattisgarh and  

“India is treading on a growth part and there is immense potential in the eastern region especially in roads, construction and real-estate. We want to tap this projected opportunity and hence is going for the expansion mode,” said Bangur. 

Consumer goods major Emami, which has been a late entrant in the space through its group company Cement, has ambitious plans to evolve into a pan-India player, but it is first setting up capacity in the east and central parts of India.

It has set up a four mtpa integrated project consisting of clinkerisation plant and grinding plant at a cost of ~3,000 crore at Risda in Chhattisgarh and is also setting up a Rs 500 crore grinding unit in Panagarh in West Bengal, which will have a two mtpa capacity. Raw material for the Bengal unit plant will be sourced from the company’s captive limestone mines in Chhattisgarh. 

has obtained clearance from the government, too, to set up a 1.5 mtpa plant in Begunia in the state’s Khurda district at an investment of Rs 255 crore. 

With these investments in place, supported by its goal to emerge a national player by setting up plants in and Karnataka, the company expects revenue of Rs 2,500-3,000 crore. “We are also open to acquisitions,” said Aditya V Agarwal, director, the Group of  

Similarly, Burnpur Cement, which is on the lookout for a larger market share, is also planning to invest Rs 500 crore for expansion of its production capacity to 3 mtpa in its plant in and another one in Patratu district in These plants have a 0.3 mtpa installed capacity each. A plan to build a two-mtpa project in is also under consideration. 

Birla Corporation, too, has ambitious plans to make it big across the eastern and northern markets. With operations in in Madhya Pradesh, in Rajasthan, in and in Uttar Pradesh, the company like its peers wants to gain market share in the eastern space. 

has marked its presence in the eastern market after acquiring Lafarge’s plants in and for ~9,478 crore. Production from these plants caters to the needs of the eastern market. According to an analyst with Motilal Oswal, the government’s infrastructural push will lead to higher uptake of In the past three months, the shares of eastern have also shown an upward trend highlighting market confidence.

While Cement’s prices shot up from Rs 13,426.9 apiece as on May 30, 2016 to Rs 16,924.05 as on August 29, 2016, Birla Corporation’s share prices went up from Rs 418 per share to ~659.45 in the same time frame. Burnpur also showed an upward trend as its prices headed north to Rs 14.65 as on August 29, 2016 in comparison to Rs 9.41 apiece three months ago.

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Business Standard
177 22