Succumbing to inventory pile-up and declining realisation, Rajasthan-based Shree Cement, a dominant player in the northern market, has resorted to take its dispatches to as far as Mumbai market. The city-based dealers said that Kutch-based Sanghi Industries also has similar plans as prices are no more remunerative.
Mumbai is an unconventional market for a player like Shree, mainly because of the long distance — almost a thousand kilometres from its production units in Rajasthan. Normally, cement transport is viable up to a maximum of 400 kilometres from the production units as freight costs go up.
H M Bangur, chairman and managing director, Shree Cement, told Business Standard, “We have sent two rakes to Mumbai, each of 3,000 tonnes. It is a negligible quantity and we have no business plans to be in Mumbai.”
When asked, what prompted the company to do so, Bangur responded that the measure was taken so that inventory level did not pile up in the North.