The Hindu Business Line : India Cements plans plants in Himachal, Rajasthan, M.P.

India Cements Ltd, which has reported a profit for the second straight year, plans to have a pan-India footprint. Apart from signing up for a two million tonnes a year cement plant in Himachal Pradesh, the company is scouting for mining leases in Rajasthan and Madhya Pradesh for setting up plants in these States.

It hopes to finalise the plans for its Himachal Pradesh plant, for which it has signed an agreement with a State Government undertaking, in the next month or so. The company expects to complete this project in the next three to four years.

With its plans to enter Rajasthan and Madhya Pradesh, India Cements wants to be present in all the major markets, according to Mr N. Srinivasan, Vice Chairman and Managing Director, India Cements.

Helped by strong demand and improved prices, India Cements' profits before exceptional items for the fourth quarter of 2005-06 more than doubled over the same period in the previous year while sales grew 26 per cent. For the year ended March 31, 2006 the company's net profit jumped almost 10 times while sales were up 32 per cent.

Mr Srinivasan was optimistic about the company's prospects given the growing demand for cement across markets where the company now had a presence. It was catching up with industry leaders in terms of various operating parameters and its plants were operating to full capacity.

In 2005-06, the company produced nearly 75 lakh tonnes of cement.

He said the company was modernising and improving facilities at its plants, which would increase capacity by two million tonnes over the next two years.

He said India Cements had brought down its long-term loans to Rs 1,400 crore from Rs 1,900 crore at the end of last financial year and repaid another Rs 100 crore so far this year. With the money raised through foreign currency convertible bonds available for capital expenditure - this year the company would spend about Rs 150 crore more than its normal capital expenditure of Rs 30 crore - India Cements was confident that by the end of this financial year, it would repay a substantial part of its debt. Its accumulated losses stood at Rs 262 crore.

The board of directors has not recommended any dividend in view of the accumulated losses.