To tap the growing demand of cement in the country, Ambuja Cements is expanding its cargo fleet for the internal movement of the construction material and is adding three ships by next year at an investment of Rs 150 crore.
The company currently has a fleet of seven cargo ships for transporting cements for domestic as well as export purpose.
"Seeing the demand in the country and the cost and problems faced in transporting cement through the surface route, we have decided to primarily opt for sea traffic. To consolidate our strength, we will add three cargo ships to our existing fleet by the end of next year," Ambuja Cements Ltd Managing Director A L Kapur told PTI.
The first of the ships is expected to be delivered during the current year, while the remaining two would be delivered to the company next year, he added.
The ships are being manufactured here by a domestic company, Kapur said adding "... Only engines were imported".
He said two ships would cost Rs 52 crore each, whereas one would be for Rs 44 crore.
"Two ships will have carrying capacity of 4,000 DWT (Deadweight tonnage) and one will be of 2,800 DWT," Kapur said adding that the ships would primarily cater to cement distribution for the domestic market.
The company currently exports 1.2-1.4Mt of cement annually and plans to cut down it in the future.
"Domestic demand is accelerating. So we plan to cut down gradually and this year we will export only about eight lakh tonnes," he added.
Ambuja Cements currently has three dedicated terminals at Panvel (Mumbai), Surat and Mul Dwarka (Gujarat) ports and plans to add one more at Cochin (Kerala) port. The Mul Dwarka terminal, which caters to both domestic and international market, has a transportation capacity of 4-5Mta, while Panvel and Surat have 1.5Mt and 0.8Mt capacities each year respectively.
"We are constructing a new terminal at Cochin at an investment of Rs 85 crore with carriage capacity of about 1Mta, which will be meant for domestic distribution. It will be ready for operation by next year," Kapur said.
To meet the domestic cement demand created by the infrastructure boom, Ambuja Cements is embarking on a Rs 3,500 crore capacity expansion drive, which would take its total production to 25Mt in two years.
The company’s current production stands at about 18Mt.
It currently has five integrated plants, besides six grinding units at different locations across the country.
The company would expand its capacities in Rauri (Himachal Pradesh) and Bhatapara (Chhattisgarh) by setting up new lines of 7000tpd clinker production in each.
The Mumbai-based company is also expecting a 50 per cent jump in revenues to up to Rs 9,000 crore on the back of the capacity expansion by 2010. Last year, it had an income of about Rs 6,000 crore.