Cement maker Jaiprakash Associates (JA) today said it would invest around Rs 10,000 crore in the next three years to increase its annual production capacity to 50 million tonnes from a little over 20 million tonnes at present.
“We will invest around Rs 10,000 crore, in the next three years, including Rs 3,000 crore, in the current financial year, to jack up our annual production capacity to 50 million tonnes,” said Rahul Kumar, chief financial officer.
The company has 19 million tonnes of installed capacity at its 12 plants across the northern, central and western parts of the country and a 2.2-million tonne facility within the Bhilai Steel Plant in a joint venture with Steel Authority of India Limited (SAIL). Kumar said the proposed investment will be funded through a mix of debt and equity in the ratio of 70:30, but the firm does not have “any immediate plans” to raise equity to finance the debt part.
“We have new plants coming up in almost all parts of the country. This will take our installed capacity to 34 million tonnes annually,” he said. JA produced 11 million tonnes of cement in 2009-10 and hopes this will go up to 20 million tonnes in the current financial year by enhancing capacity utilisation to almost 100 per cent. Asked whether the company plans any acquisition, either in India or abroad, Kumar said, “We will be open to evaluating any opportunities that may come our way.” India’s total installed cement capacity, as of March, 2010, stood at around 250 million tonnes, though actual production last year was around 200 million tonnes. According to Crisil Research, about 35 million tonnes of capacity is likely to be commissioned in 2011-12.