Cement major ACC Ltd is poised to increase its manufacturing capacity in India to 35 million tonnes per annum from 30 mtpa (beginning of the year) with the addition of a couple of more plants.

“This capacity addition is part of the ₹3,000-crore capital expenditure the company is implementing,” said KN Rao, Director - Energy and Environment.

Speaking to BusinessLine on the sidelines of a CII conference on energy conservation, Rao said the expansion and setting up of new plants is part of the company’s efforts to further consolidate its business. The expansion includes plants at Jamul in Chhattisgarh and Sindri in Jharkhand. While the capacity at Jamul will be 2.79 mtpa of clinker and 1.1 mtpa of grinding facility, the Sindri unit will have grinding facility of 1.35 mtpa, adding to the overall manufacturing capacity while ensuring supplies.

Demand-supply situation

Referring to the current demand-supply situation in the country, Rao said last year has been particularly tough for the cement manufacturers in the country. The demand, however, varies from one region to another and so does the installed capacity, which is much higher in the South due to availability of limestone.

However, there are clear indications that the demand this year could be up 5-6 per cent as the government focusses on growth of infrastructure, smart cities, and the housing sector, among others. While the Indian cement industry has an installed capacity of over 372 mtpa, the overall domestic consumption has been about 270 mtpa, which was down 2 per cent during 2015, resulting in the industry being competitive.

As a result of available capacity and the lower demand, the overall capacity utilisation in the company has been close to 80 per cent. This was achieved mainly as the company has 17 plants spread across different zones, which helps in bringing about a fair balance in the business, he said.

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