JK Lakshmi Cement draws up Rs 400-cr expansion plan

The Rs 900-crore JK Lakshmi Cement, one of the leading cement manufacturers in north India, has plans to expand it cement manufacturing capacity from the existing 3.4 million tonne to about 5 million tonne with an estimated investment of Rs 400 crore.

Also, it is planning to set up at least 15 to 20 ready mix concrete (RMC) plants with an investment of Rs 8-10 crore per plant of which around six would be added during the current financial year. At present, it has seven RMC plants in northern India.

JK Lakshmi Cement Director Shailendra Chouksey said, "In order to meet the increasing demand of construction sector, we are investing Rs 400 crore for expanding the production capacity. The expansion would be funded by a mix of debt, equity and internal accruals."

The capacity enhancement is expected to be completed by October next year along with increasing its power-generating capacity to meet the requirement.

The company today unveiled Punjab's first state-of-the-art RMC plant in Mohali. Elaborating benefits of RMC, he said, " In the developed economies the site mix concrete now hardly constitute 20 per cent of the total concrete use and the balance is 80 per cent is in the form of RMC. In case of RMC the ingredients are properly selected, stored and mixed in a calibrated weighing mechanism."

Disclosing the RMC business plan, he said, "The RMC industry is rapidly growing at the rate of 25-30 per cent year. According to industry estimates, currently about 6.5 per cent of the total cement is consumed in the form of RMC, the percentage is expected to go up to 11-12 per cent by 2010."

It is estimated that by using JK Lakshmi RMC, customers will be able to save on their total cost of construction. "Our studies indicate that use of our RMC, achieves almost 15.5 per cent savings in construction costs in terms of factors," he stressed.

So in order to meet the burgeoning demand, we are planning to add at least 15-20 plants in the coming years of which at least around six would be added in the current financial year itself.

"The company has a wide spread marketing network with their own marketing offices in Rajasthan, Gujarat, Maharashtra, Punjab, Haryana, Delhi, Uttar Pradesh, Uttrakhand, Himachal Pradesh and Jammu & Kashmir and in last financial year, it clocked a turnover of Rs 972 crore.