Rajasthan-based Binani Cement, which is expanding into foreign markets, is facing land acquisition problems for its grinding unit in South Africa.
Binani Cement Managing Director Vinod Juneja said, "There are some local land acquisition issues in South Africa. The location of the unit may be changed, which will delay the project by around six months." The cost of the project, with an annual capacity of 1 million tonnes, was Rs 350 crore.
The Rs 1,000-crore company from the Braj Binani stable is in the process of ramping up its overall capacity to 13 million tonnes by 2012 from the current 6 million tonnes, half of which would be outside India in countries such as China, South Africa and Mauritius.
The company is trying to offset slowing domestic demand by expanding into foreign shores. Recently, Kanpur-based JK Cement too had said that the company would rework its proposed project of 2.2 million tonnes, which was worth $400 million, in the United Arab Emirates citing liquidity crunch and infrastructural hurdles at the location.
Binani Cement has plans to cater to the South African market from its Chinese plants (where Binani is doubling its existing capacity to 2 million tonnes annually) by supplying clinkers. The company is also doubling its capacity in Dubai to two million tonnes and setting up a 0.8 million tonnes plant in Mauritius.
In the quarter ended September, the company's net profit dropped 44 per cent to Rs 26.81 crore compared with Rs 47.87 crore in the corresponding period last year.
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On the Bombay Stock Exchange, the company's share price at Rs 29.40, up 2.26 per cent, today.
It was significantly lower than its 52-week high of Rs 127.50 it hit in November last year.