Shree Cement aims to be a pan-Indian player

The company is aiming for 40 mtpa capacity in the coming five years from its existing 25.6 mtpa

Shree Cement is considered the northern market leader in the sector but is now aiming at a national presence. It intends to invest Rs 6,000 crore over the next five years to this end, through new projects and expansion of existing ones.

With surplus from its limestone reserve in Chhattisgarh, it intends to expand there and supply upcoming plants in Jharkhand and West Bengal. In limestone scanty Jharkhand, it is establishing a two million tonnes per annum (mtpa) grinding unit at a cost of Rs 600 crore. In Bengal, another Rs 600 crore for grinding units in the Raghunathpur region.

It recently added 1.6 mtpa capacity to the two mtpa Bihar unit and has undertaken steps to expand the capacity at Raipur in Chhattisgarh by 2.8 mtpa. The company is in the process of finalising locations in neighbouring states for setting up grinding units which will source clinker from the Raipur unit.

H M Bangur, managing director, says, in recent years, he has been emphasising on setting up clinker grinding units at locations close to major consumption centres. "These help in serving customers more efficiently and are (more) cost-effective and environmentally friendly," he said.

The company first entered the eastern market in 2007 when it signed an agreement with the Chhattisgarh government to set up clinkerisation units. It marked the company's first foray outside its traditional base in Rajasthan, where it has five units.

Thereafter, Bangur, who now claims to have the second highest market share in Chhattisgarh, went ahead with expansion in Bihar, where it now has the largest share. Jharkhand and Bengal that were missing in its coverage of north and east will now be filled by sourcing limestone from Chhattisgarh.

In 2015-16, it added a two mtpa grinding unit at Bulandshahr in Uttar Pradesh.

The southern region will be a new area. "Market dynamics are different in the south and the north," says an analyst with Motilal Oswal. Karnataka, where operations are likely to commence in 2018, will mark Shree's first foray into south India.

Bangur is aiming for 40 mtpa capacity in the coming five years from its existing 25.6 mtpa. According to its 2015-16 report, it was the market leader in Rajasthan, Haryana, Delhi and Bihar, and number two in Chhattisgarh.