India’s largest cement producer, Ultratech cement, on Thursday (2 June) announced a capital expenditure of Rs 12,886 crore to increase its cement production capacity by 22.6 Million Tonnes Per Annum (MTPA) with a mix of brownfield and greenfield expansion.
This additional capacity will be created across the country by setting up integrated units, grinding units and bulk terminals.
Commercial production from these new capacities is expected to go on stream in a phased manner by 2024-25. UltraTech’s current expansion program is on track and estimated to be completed by 2022-23.
“Upon completion of the latest round of expansion, the Company’s capacity will grow to 159.25 MTPA, reinforcing its position as the third largest cement company in the world, outside of China,” the company said.
“This ambitious capacity expansion plan is a significant milestone in the ongoing transformational growth journey of UltraTech. The company has more than doubled its capacity over the last five years and is committed to meeting India’s future needs for housing, roads, and other infrastructure,” Kumar Mangalam Birla, Chairman, Aditya Birla Group, said.
“This investment is backed by a strong conviction on India’s growth potential as well as a deep and nuanced understanding of the market dynamics of the cement industry. Given the size of the investment outlay, I am confident that this new capacity creation will have a multiplier effect leading to jobs and growth across multiple regions in India,” he added.
In 2022, the Indian cement industry has experienced significant developments.
Recently, Gautam Adani-led Adani Group, through an offshore special purpose vehicle (SPV), has acquired a controlling stake in Holcim AG’s cement businesses in India (63.11 per cent in Ambuja Cements and 54.53 per cent in ACC) in a $10.5 billion (Rs 80,000 crore) deal to become the second-biggest cement producer in the country.
With India’s cement consumption at just 242 kg per capita, compared to the global average of 525 kilograms per capita, there is significant potential for the growth of the cement sector in India.