Shree Cement to invest Rs 700 cr for Rajasthan unit

Despite the glut in the cement industry, Shree Cement, the largest cement player in the North, has placed equipment orders of nearly Rs 700 crore for its kiln unit in Rajasthan, even projects amounting to more than Rs 13,000 crore are running behind schedule.

In the current financial year only two cement manufacturers have placed kiln orders for increasing capacity.

Hari Mohan Bangur, managing director, Shree Cement, said, “We have placed order of close to Rs 700 crore for our 1.5 million tonne per annum plant in Ras, Rajasthan. The construction work has already started on the site and we expect it to complete by next year.”

The company has placed the order with Cologne-based KHD Humboldt for a 4500 tonne per day or 1.5 mtpa plant kiln unit.

Shree Cement has the largest single-location integrated cement plant in North India located in Rajasthan with an installed capacity of 13 million tonne. While North accounts for 72 per cent of its volumes, the rest is from the central India.

Last quarter the company commissioned 150 mega watt (MW), the first phase of its 300 MW merchant power plant. The second phase will be comissioned by December 2012.

In April last year, the company had decided to revive its plans to launch a 2 million tonne per annum clinkerisation unit near Raipur in Chattisgarh. The company has not placed any orders yet for this plant but it has started the land acquisition process in the state. This will be the first time Shree Cement will venture outside Rajasthan.

According to a report by Fortune Group released in December 28, says, “Slowdown in capacity additions in the North is resulting in a likely deficit situation. The region remains a large supplier to both central and western regions.”

The only other order which was placed this year was by Anil Dhirubhai Ambani Group's cement arm Reliance Cement of 10, 000 tonne per day, which has issued letters of intent (LoIs) for equipments for its Satna I unit in Madhya Pradesh. The LoI was issued to European engineering majors Polysius, FL Smidth and Loesche.