ACC inaugurates unit in Karnataka, plans to resume ready-mix concrete expansion projects

ACC inaugurates unit in Karnataka, plans to resume ready-mix concrete expansion projects
Published: 14 December 2009

ACC inaugurated a greenfield cement grinding plant at Thondebhavi in Chikballapur district of Karnataka. The plant, which has been set up with an investment of INR350 crore, has a capacity of 1.6Mta and would produce fly ash-based Pozzolana cement.

The company is also expanding the capacity of its plant at Wadi in Karnataka from the present 5.8Mta to 8.8Mta by March 2010.

The company is also increasing the capacity of its plants in Chandrapur in Maharashtra and Bargargh in Orissa as part of a INR1500-crore capacity expansion plan for this financial year. In the financial year 2010-11, the company plans to invest INR1300 crore for capacity expansion, mostly to complete ongoing projects.

Banerjee said the additional capacity the company was creating now "would be absorbed in the market without any problem."

Meanwhile, the company has decided to review its decision of scaling down the company’s ready-mix concrete business and recommence the expansion plan by the middle of 2010.

“We have a long-term view of this business. All that we have done is scale down our capex expansion plan due to the decline in demand for ready-mix concrete in certain mega cities like Mumbai and Bangalore. We will review the whole thing by the middle of 2010 and recommence expansion plans,” ACC Managing Director Sumit Banerjee said today.

The company had earlier announced a plan for investing INR 600 crore to set up ready-mix plants by 2011. Later, the slowdown in demand in the realty and private construction segment forced the company to drop the plan. Banerjee said the company is expecting to see a recovery in the ready-mix business in cities like Bangalore, Mumbai and Chennai by the middle of 2010, and "will get back to business" then.

The RMX business of ACC is now being handled by its wholly-owned subsidiary, ACC Concrete. The company owns 37 plants for this business. With the fall in demand, the company had decided to either scale down the production or close down some of these plants temporarily.

But ACC has re-opened its ready-mix concrete plant in Yelahanka in Bangalore. "We operate with just one plant in Bangalore," said Banerjee, pointing out that the company is keeping a close eye on demand. ACC owns six ready-mix plants in Bangalore alone.