Displaying items by tag: India
India: The state investment promotion board of Andhra Pradesh has approved proposals by Chettinad Cement and KCP to build cement plants in the state. Chettinad Cement plans to spend US$210m towards building a grinding plant in Vizag and a plant in Guntur, according to the Economic Times newspaper. These projects are scheduled to start production in March 2019. KCP has allocated US$83m towards its project in Krishna with the first phase of operations due to start in mid-2018. However, media commentators have noted that the south of India is facing cement production over capacity.
India: The government of the Puducherry union territory has proposed a subsidised cement scheme for low and middle-income residents. The scheme will be named after former Congress President Sonia Gandhi, according to the Press Trust of India. The project intends to emulate the Amma Cement scheme currently running in Tamil Nadu. Cement for the scheme will be procured outside of the region due to a lack of production plants.
Indian cement producers continue to defend prices
12 June 2017India: Sagar Cements, India Cements and Bharathi Cements have continued to defend public concerns over cement pricing due to economic trends beyond their control. In a press conference the producers blamed rising input costs, distribution costs, taxes and high margins by dealers, according to the Times of India newspaper. They added that the key demand drivers for the industry are residential house building and government projects.
S Srikanth Reddy, Executive Director of Sagar Cements forecast that cement demand will rise by 10 – 18% in Telangana and Andhra Pradesh over the next two to three years due to large government-run infrastructure projects. Tamil Nadu and Kerala are expected to rise by no more than 5% and Karnataka is expected to rise by 2 – 5%.
However, despite increases in the short term, the cement producers forecast problems for the industry in the south of the country, and in Andhra Pradesh and Telangana in particular, due to production overcapacity as producers increased their installed capacity in anticipation of high demand. At present they say that producers are forced to run plants at 60% production utilisation rates with high volatility in price rates in a highly fragmented market with over 50 brands.
India: The cement industry is expected to grow at 6-7% in the current 2017-2018 fiscal year, which runs from 1 April 2017 to 31 March 2018, according to HeidelbergCement India. The company said that, while infrastructure (including a focus on concrete roads), affordable housing programmes and the prospect of a normal monsoon augur well for the industry, oversupply may restrict the ability to pass on any input cost increases.
India: Members of the Cement Manufacturers Association (CMA) have met with Nitin Gadkari, the Minister for Road, Transport and Highways, to discuss price concerns around the country’s road building campaign. Local producers stand accused of increasing prices despite no rise in input costs amidst a national plan to build more roads, according to the Hindu newspaper. Producers dismissed these concerns, saying that price were lower than they had been in 2015. Instead they bashed discrepancies in export taxes between India and Pakistan.
Delegates from the cement producers at the meeting included N Srinivasan, managing director of India Cements, HM Bangur, managing director of Shree Cement, KK Maheshwari, managing director of UltraTech Cement, Ajay Kapur, managing director of Ambuja Cement, Mahendra Singhi, Group chief executive officer and wholetime director of Dalmia Cement, Ujjwal Batria, country chief executive officer and managing director of Nuvoco Vistas Corp and Aparna Dutt Sharma, Secretary General of the CMA.
India: Orient Cement has signed a deal with Jaiprakash Associates to buy three cement plants from it for US$302m. The arrangement, which was originally announced in October 2016, includes a deal to buy a 74% stake in Bhilai Jaypee Cement for US$225m and the acquisition of the Nigrie cement grinding plant in Singrauli, Madhya Pradesh from Jaiprakash Power Ventures for US$77m, according to the Hindu newspaper. Bhilai Jaypee Cement, a joint venture between Jaiprakash Associates and the Steel Authority of India Limited (SAIL), has a 2.2Mt/yr integrated Portland slag cement plant in Satna Madhya, Madhya Pradesh and a grinding plant in Bhilai, Chhattisgarh.
The transaction will be funded by Orient Cement through a mix of internal accruals, debt and equity funding. The acquisitions will increase Orient Cement’s production capacity to 10.2Mt/yr from 8Mt/yr and it will grant it access to the central and eastern regions of the country.
India: 15 companies have expressed interest in building cemeunt plants near to NTPC’s power stations. The electricity generation company sought cement producers in early 2017 to submit expressions of interest for partnerships to build 1Mt/yr cement plants, according to the Mint newspaper. NTPC wants its partners to sign long-term agreements with it to exclusively use fly ash and electricity from its power plants. The company has declined to name the companies that have expressed interest in the scheme. However, the power plants it wants to set up cement plants near include Barh, Farakka, Bongaigaon, Dadri, Badarpur, Moda and Aravali Power.
Japla plant to reopen in Jharkhand
26 May 2017India: Jharkhand Chief Minister Raghubar Das has reassured the people of Palamu that the Japla cement factory, which has been closed for many years, will be reopened soon. Das said that talks have been completed with the Steel Authority of India Ltd (SAIL) with respect to handing over of the limestone mines to Jharkhand State Mineral Development Corporation to serve the Japla Cement Factory. He added that reopening of the factory would provide employment to thousands of people.
Ramco Group chairman Ramasubrahaneya Rajha dies
17 May 2017India: P R Ramasubrahaneya Rajha, the chairman of business conglomerate Ramco Group, has died at the age of 82 after a brief illness. He is survived by his wife and son P R Venkatarama Rajha, the vice-chairman and managing director of the group, according to the Press Trust of India. Ramasubrahaneya Rajha was the son of the group’s founder P A C Ramasamy Rajah.
India: Shree Cement’s revenue rose by 4% year-on-year to US$442m for the quarter that ended on 31 March 2017 from US$424m in the same period in 2016. However, its profit fell by 54% to US$47.5m from US$103m. The fall in profit arose from the group’s power business and other income sources. The earnings before interest, depreciation, taxation and amortisation (EBITDA) after inter-segment transfers rose by 10% to US$76m from US$69m. The cement producer said that its results are not comparable as it adopted a change in its accounting year from the 2015 - 2016 period.