ACC to add 5 mtpa capacity in next 3 years

Enthused by rising cement demand from the eastern region, ACC will create additional five million tonnes per annum capacity (mtpa), entailing an estimated investment of around Rs 3,000 crore.

The expansion, which is likely to go on stream over the next three years, will take the overall cement making capacity of the company to 35 million tonnes a year.

"The group company ACC will increase cement capacity in east India by additional five million tonnes by early 2015," Holcim, which is a majority stakeholder in ACC Ltd, said in a release.

A company official declined to comment on the likely investment. However, an industry official said that it takes around Rs 600 crore investment to create a one million tonne cement manufacturing capacity.

ACC has nine million tonnes per annum cement making capacity in the country's eastern part, where the demand for cement is of late going up by nearly double digits. Aiming to cash in on the increased demand, cement makers are putting in 18 million tonnes per annum additional capacity between FY'12 and FY'14 in the eastern India to its overall current capacity of 60 million tonnes.

The cement making capacity of the country is currently pegged at a little over 300 million tonnes per annum, up from 200 million tonnes in 2008 and the industry is projected to add 72 million tonnes a year capacity between FY'12 and FY'14. Capacity utilisation is also one of the highest in the eastern region so far in the current fiscal at 80%.

Holcim said the existing Jamul clinker making facility in Chhattisgarh would be replaced by a latest plant and grinding capacity to be increased simultaneously.

The Jamul facility would have 2.79 million tonnes clinker manufacturing capacity with an estimated investment of Rs 800 crore. In addition, capacity of the existing Sindri grinding plant would also be increased.

"... A new grinding plant will be built at Kharagpur (in West Bengal). Both (Kharagpur and Sindri) installations will source clinker from the new Jamul plant. Therewith, overall capacity of ACC will increase to 35 million tonnes," it said.

In the recent past, ACC Ltd has increased capacity at its Chanda plant in Maharashtra and has begun operating world's largest clinker kiln at its Wadi plant in Karnataka.

ACC's sister firm Ambuja Cements is also ramping up its clinker capacity at Rauri in Himachal Pradesh and Bhatapara, near Raipur and setting up two new grinding stations.

Holcim holds majority stake in Ambuja Cement as well.