India: Jaypee shelves Gujarat plant sale, eyes further expansion

Jaypee Cement has decided to defer plans to sell its Gujarat unit and is now looking to expand capacity through acquisitions and the construction of new plants. 

“We did not get the right valuation. So we have shelved plans for selling the Gujarat unit,” Ashutosh Kumar, Joint President (Marketing), Jaypee Cement told local press.

 “We were in discussions with some parties. But, as of now we are comfortable in terms of cash position, Kumar said. According to local reports, India’s largest cement producer, UltraTech Cement, had been closing in on the Gujarat deal. Previously, talks with Irish-based cement major CRH had fallen through.

Looking ahead, the company now plans to raise capacity of its existing facilities as well eyeing acquisitions and the creation of greenfield plants.

"The two Andhra Cement plants acquired recently have started production with initial supplies to natural logistics market of Andhra Pradesh and Orissa. Re-commissioning of the Gulbarga plant in Karnataka has been completed on schedule and it is likely to start production very soon,"  Kumar said.

"In the near future, the group plans to expand its cement capacities via acquisitions and greenfield additions to maximise economies of scale and build on vision to focus on large-size plants from inception," he added.