Project Consultancy, Reports & Profiles

The Indian cement industry is on a capacity expansion spree and was expected in 2007-08 to add another 60 mn tonne, with an investment of around Rs 100 bn. Between 2005 and 2008 around 55 companies announced either greenfield or brownfield expansion plans. With these projects, India's cement capacity was to touch a new high of approximately 200 mn tonne by 2008. Indian cement firms had also plans to increase their capacity by 74 mn tonne by 2010 with investment of Rs 300 bn. Companies like Zuari Cement, OCL, Dalmia Cement, Binani Cement, Birla Corp, India Cements, Saurashtra Cement, NCL Industries and JK Cement have proposed or are implementing capacity expansion projects. By 2008, about 21.5 mn tonne of additional capacity was expected to be realised through expansion only. 

The overall capacity expanded to 210 mn tonne (MT) in 2008-09. According to Cement Manufacture's Association, capacity of around 13.5 mn tonne was added in 2008-09, of which 9.85 mn tonne was contributed by greenfield projects. The industry is expected to add 50-60 mn tonne in the next two years. Most of the large players will add up capacities under their capital expenditure programmes. Leading the lot is Jaypee group which recently announced expansion of 25 mn toone, ACC has plans to expand capacities by 7 mn tonne, Ambuja Cement by around 7.5 mn tonne, Madaras Cement by 6 mn tonne and UltraTech by 5 mn tonne.

The small and medium sized cement companies are looking at adding around 15-20 mn tonne of capacity per annum in the next two years. Binani Cement was to add 2.2 mn tonne in 2007-08, Dalmia Cement was expected to add 2.3 mn tonne. A division of Century Textiles was to add 1.5 mn tonne. Similarly, Jaiprakash Associates were expected to add 4.2 m tonne. J K Cement has planning to add 3.5 mn tonne by 2008-09. Kesoram has announced plans to add another 1.7 mn tonne. Madras Cements 4 mn tonne; Mangalam Cement of 11.0 mn tonne, OCL of 2.5 mn tonne; and Shree Cement 4.5 mn tonne.