MP Birla Group’s flagship company Birla Corporation, now controlled by R S Lodha, today announced its plan to set up a 3Mt cement plant in Madhya Pradesh at an investment of 1,200 crore.
The new plant would augment the company’s total cement capacity to over 10Mt by 2011.
"We have decided to install a 3Mt cement plant in Madhya Pradesh for which we have already signed an MoU with the state government. With commencement of this greenfield plant the cement capacity will cross 10Mt," Birla Corp Chairman R S Lodha said on the sidelines of the company’s AGM here today.
The investment in the MP project would be Rs 1,200 crore and it would be funded through debt and equity which would come mostly from internal accruals, Lodha said.
"We are waiting for the limestone mining block and the state is in the process of allotting it to us cancelling the right given wrongfully to someone else," Lodha said.
The company, he said, would go for land acquisition only after the limestone block has been offered. Birla Corp has asked for 2,000 acres.
If, the company fails to receive the limestone block, which may run into rough weather if the state government fails to cancel the right presently in force, then Birla Corp would relocate the project to other location.
The company has also received an exclusive coal mining block in Madhya Pradesh.
The ongoing brownfield expansion at its existing 0sites like Satna, Chittor and Durgapur would be completed by June 2009 and the capacity would rise to 7.5 MT from 3.5 MT now. Lodha said the group was planning to shift the operation of Soorah jute mill to Birlapur and all its employees, close to 12,000, would be absorbed at the new location.