Birla Corp Ltd, part of the M P Birla Group, is planning to raise its production capacity to 27.6Mta by 2028-29 through the addition of new clinker and grinding plants, Chairman Harsh V Lodha told shareholders at the company’s annual general meeting (AGM).
The company expects cement demand in India to grow at a CAGR of 6-7 per cent over the coming years, justifying its expansion strategy.
Currently operating at 20Mta, Birla Corp anticipates a capital expenditure of INR43.35bn (US$520m) for the programme, Lodha confirmed. The corresponding increase in energy consumption will require greater coal availability, he added, noting that the allocation of coal blocks to the company is at various stages of approval.
Its wholly-owned subsidiary, RCCPL, plans to invest INR20.35bn (US$244m) to expand the clinker production capacity of its Maihar unit in Madhya Pradesh, which will in turn supply three new grinding units to be established at Prayagraj, Gaya and Aligarh. “We have budgeted for an investment of a little over INR2035 crore for these new units,” said Mr Lodha.
The Chairman welcomed the Goods and Services Tax (GST) Council’s recent decision to cut the rate on cement and rationalise taxes on other building materials, saying the move is expected to boost housing demand as well as improve profitability.
Looking back on FY24-25, Mr Lodha noted that it was a year of unprecedented pricing pressure. Cement prices fell by 11 per cent in the first eight months, with only modest recovery towards the end of the year. “Despite unfavourable market conditions, the company’s cement division maintained a capacity utilisation of 91 per cent and registered sales growth of 2.5 per cent by volume,” he said.
