Gujarat-based Sanghi Industries is drawing up plans to claim a pie of the Maharashtra cement market, The market will be catered through augmented capacity at its cement unit in Kutch, Gujarat. The company has already indicated expansion of its unit in Kutch from a current capacity of 3.3Mt to 9Mt by 2009-10.
“We hope to achieve financial closure so as to undertake expansion by the end of the current fiscal. However, the technical collaboration for increased efficiency of the new unit will be in place much before that,” said its VP Aditya Sanghi. The company is currently in discussion with at least five players for sourcing of technology. “The new line will be much bigger and more efficient,” Sanghi said.
The Rs 600-crore company is planning to use the cheaper sea route to transport cement into the Maharashtra market and is currently scouting for locations to set up a cement terminal in the state. “Market surveys are being conducted in the western coast of India where we can reach through the sea route,” Sanghi said.
The company has not yet finalised the debt equity structure for fund-ing its expansion which is likely to cost about Rs 1,500 crore. Apart from a new cement unit and upgrading the jetty, investment will be made in a lignite-based power project of 120 MW to be executed in two phases.
“The board has approved raising FCCB funds of up to Rs 1,500 crore to fund our projects. However, no decision has been taken on how much to raise,” Sanghi said.In addition, the Sanghi Group is also planning to set up a 1,200 MW imported coal-based power plant at an estimated investment of Rs 4,000 crore in Kutch.