Birla group scores in March cement despatches

The Aditya Birla group has outpaced the Swiss cement giant Holcim in the domestic operation in terms of cement despatches in March. The Birla group, which comprises UltraTech Cement and Grasim Industries, registered a despactch growth of over four times compared to Holcim, which controls a majority stake in ACC and Ambuja Cements.

The Birla group despatched 3.37 million tonnes of cement in March — a rise of 11.24 per cent against 3.03 million tonnes in the corresponding month last year. However, Holcim could see a despatch growth (putting together despatches of ACC and Ambuja) of only 2.75 per cent in March at 3.73 million tonnes as against 3.63 million tonnes last year in the same period.

Industry analysts say low despatch growth was expected for ACC and Ambuja as they were facing capacity constraints whereas Birla group has constantly been raising its capacity. “Grasim had a significant capacity expansion of grinding units last year which helped the company to increase its volumes,” said an analyst with a domestic brokerage firm.

In the January-March quarter too, Birla group left Holcim behind with a despatch growth rate of 9.68 per cent whereas Holcim could reach only up to 5.88 per cent growth.

The cement capacity of Aditya Birla group is scheduled to go over 45 million tonnes with its expansion projects whereas Holcim’s overall expansion will take its capacity to around 50 million tonnes in the next one and a half year. However, if the capacity of Century Textiles and Industries - part of the B K Birla group - is taken into consideration, Birla group’s capacity will raise up to 54 million tonnes.

The 207 million tonnes domestic cement industry is expected to add around 30-35 million tonnes of fresh capacity in the current financial year.

RACING AHEAD Despatch growth of the two biggest cement maker groups
	Holcim			Aditya Birla group
	2008	2009	% growth	2008	2009	% growth
March	3.63	3.73	-2.75	3.03	3.37	11.24
Jan-Mar	10.04	10.63	-5.88	8.47	9.29	9.68
Figures in million tonnes

Since November last year, the industry is consistently maintaining a despatch growth of over 8 per cent. In December, the growth had even touched 12 per cent on the back of demand from the semi-urban regions for low housing projects, pre-election demand for infrastructure and personal housing segment. The cement sector is hopeful to maintain a growth of around 8 per cent in FY09.