JK Cement intends increase production capacity to about 23Mta in the next two years, from 15Mta now, by expanding its footprints in northern and central India.
"We will maintain and grow our market share in the short term. Apart from the ongoing expansion in Panna, and now in Hamirpur, we already have plans for another 4Mt expansion," said Madhav Krishna Singhania, JK Cement’s CEO. "We have visibility of reaching around 23Mta by 2023."
The company will be expanding its footprint in the north and the central regions in the coming years. "While the northern market is very attractive in terms of demand and capacity utilisation, we have the capabilities to become a market leader in the central region," Mr Singhania said.
In line with this plan, the company is setting up a new 2Mta plant at Hamirpur in Uttar Pradesh.
The company has earmarked INR29,700m (US$406.7m) as capital expenditure for adding 2Mta capacity each at the Panna and Hamirpur projects. On a long-term basis, the company’s facility at Panna has a land bank and raw material to grow the capacity to 15Mta, Singhania said.
JK Cement has about 12Mta of grey cement capacity in the north spread across Rajasthan, Haryana, western Uttar Pradesh and Gujarat, as well as 3Mta in Karnataka, which caters to southern Maharashtra and parts of Kerala.
The company recently secured a limestone mine in Jaisalmer, but with just the mineral concession it will take at least 5-6 years to set up a new plant. At present, the average utilisation level of JK Cement is 75-80 per cent.
