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The joint venture cement plant of Hyderabad-based Sagar Cements Ltd and Vicat Group of France will produce about one lakh to 1.5 lakh tonnes of cement a month from June next year.
“Between June and December next year, we hope to have 0.75 million tonnes of cement dispatches from the phase 1 of the plant coming up at Chatrasal, in Gulbarga district of Karnataka,” Mr S. Sreekanth Reddy, Executive Director, Sagar Cements Ltd, told Business Line here on Wednesday.
The cement would be sold in Maharashtra, Karnataka and Andhra Pradesh markets. “About 60 per cent of cement will go to Maharashtra, followed by Karnataka and AP with 25 per cent and 15 per cent respectively,” Mr Reddy said.
The financial closure — in the form of Rs 1,000-crore debt and Rs 650-crore equity for Phase I of the joint venture with a cement production capacity of 2.5 million tonnes a year – was completed early this year.
The total capacity envisaged, including second phase, is pegged at 5.5 million tonnes by 2014 with an additional investment of Rs 850 crore.
The industry scenario in the country continues to be okay with 70-75 per cent of capacity utilisation on an average. “For this utilisation levels, the present prices are healthy for the sellers as well as buyers,” Mr Reddy said.
The demand is mainly being driven by north and eastern India while it is almost flat in the southern States.
Sagar Cements' scrip declined 1.86 pc to end at Rs 132 on Bombay Stock Exchange on Wednesday.
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