The country’s largest power generation company, National Thermal Power Corporation’s (NTPC), move to foray into cement making in a joint venture has aroused interest among the domestic cement players.
NTPC last week said that it has invited expressions of interest (EoI) from companies to partner the state-owned company in setting up four plants to manufacture cement using fly ash generated from its power stations.
North-based Shree Cements, which has plans to set up a grinding unit in a joint venture with NTPC, has already submitted an EoI.
H M Bangur, chairman and managing director, Shree Cements, told Business Standard, “We are definitely interested in such a venture and we are far ahead in discussion with NTPC.” Though the model of the JV is not known, it is learnt that along with supplying fly ash at a pre-determined price, NTPC will pump in investments too in the cement company’s units.
“The location of our grinding unit, which will have a capacity of around 1 million tonnes per annum, could be in Haryana, Uttar Pradesh or Rajasthan, close to Delhi’s Badarpur unit of NTPC,” said Bangur, who is also the president of Cement Manufacturers’ Association. “We will supply clinker and NTPC will provide fly ash,” he added.
| FIRM MOVE | |
| * National Thermal Power Corporation has 18 coal-based power units | |
| * The units produce 23 million tonnes of fly ash per annum | |
| * The PSU plans to manufacture cement using fly ash generated from its power stations | |
| * Shree Cements plans 1 mn tonne grinding unit with NTPC | |
| * Ambuja says no problem if JV fits well in its business model |
Other existing players in the cement industry too have welcomed the NTPC proposal. A L Kapur, managing director of Ambuja Cements, a part of the Swiss major Holcim, said, “A JV with NTPC can happen for a grinding unit. We will be interested if the deal fits into our business model and makes good commercial sense. The locations of the NTPC’s plants should be close to the consumption centres which will save costs on the transportation front.” Ambuja, already has an understanding of fly ash supply from NTPC for its Dadri (UP) and Farakka (West Bengal) units.
Vinod Juneja, managing director, Binani Cement, said, “We are examining the proposal but it will be too premature to say on this move, as factors like land, market, logistics and limestone will have to be taken into consideration.”