Chettinad Cement on growth path
Chennai-based Chettinad Cement Corporation, which is controlled by M A Ramaswamy & Associates, has been aggressively ramping up capacity to take advantage of rapid growth in cement consumption in southern markets.
The company had brought on stream an additional two million tonnes of capacity in the fourth quarter of FY09 at Ariyalur district, Tamil Nadu. This has doubled its total installed capacity to nearly four million tonnes. In addition, the company will soon add another two million tonnes and the full benefit of these expanded capacities will be felt from FY10 and onwards. During FY10 alone, the company is expected to add nearly Rs 525 crore, or 46%, to its revenues thanks to higher sales volume. The company featured in the list of ETIG’s 100 Fastest Growing Small Companies and it offers investment opportunities for long-term investors.
Chettinad’s installed cement capacity will shortly reach 6Mt, and it has also started installation of an additional cement grinding unit with a capacity of 0.5Mt. As part of its rapid expansion, Chettinad Cement invested nearly Rs 1,200 crore during FY07 and FY09, while its cash flows were Rs 596 crore during this period. Capex has, however, been more aggressive and its debt to equity ratio was 1.92 at the end of March ’09, compared to 1.2 at the end of March ’07. Published under Cement News
