India Cements plans to up capacity at Rajasthan unit

India Cements is looking at expanding its capacity in Rajasthan with an investment of Rs 650-700 crore. The plan comes in view of the growing demand in Gujarat and Madhya Pradesh.

N Srinivasan, vice chairman and managing director, India Cements, said, “We are examining whether we can expand the capacity at the Rajasthan plant.” The present capacity of the plant is 1.3 million tonnes, and the company is planning to add one more line with similar capacity.

India Cements’ current manufacturing capacity is 15.5 mt with plants in Tamil Nadu, Andhra Pradesh and Rajasthan.

The company’s capacity utilisation is around 70 per cent in South India, which reported a flat growth, while the all-India demand grew six per cent. “The industry is linked with the economy, so the growth is based on economy,” he said.

Its Vishnupuram plant in Andhra is expected to go on full stream by July and this would help the company address power issue.

India Cements net profit dropped to Rs 26.12 crore in third quarter from Rs 56.31 crore, a year ago. Total income rose to Rs 1083.88 crore from Rs 943.95 crore.

Srinivasan said the company was facing operational challenge, especially on the cost front. “The fourth quarter will be better than the third, since demand is expected to pick up. Next year, it will be much better as government spending will increase, since election is around and interest rate is expected to soften,” he said.