JSW Cement Ltd is cementing its clinker production capacity in Andhra Pradesh with an investment of about Rs 200 crore to increase its Nandyal unit’s capacity from 2.4 million tonnes to 3 million tonnes.
“We are readying the project and studying the market trends. We will start work on the (expansion) project at an appropriate time,” Mr K. Swami nathan, Chief Marketing Officer of JSW Cement, told Vizag Industrial Scan on the sidelines of its national-level dealers meet held in Vizag recently.The expansion will be funded by the company’s internal revenue generation, he added.
In the manufacture of Portland cement, clinker occurs as lumps or nodules, usually 3 millimetres to 25 millimetres in diameter. Portland cement clinker is ground to a fine powder and used as the binder in many cement products.
JSW’s AP expansion plan is part of its pan-India expansion plan, which envisages an increase in its production capacity from 15 million tonnes to 25 million tonnes in the next two to three years. “Most of this expansion will be organic in nature. We will be putting up a 1.2 million tonne clinkering plant at our Shiva unit at a cost of Rs 800 crore to Rs 1000 crore. We intend to launch work in April and will take 12 to 15 months for completion,” Mr Swaminathan said.
India’s cement consumption has seen a dip on a quarter-to-quarter basis in this financial year, as an upshot of the general economic slowdown and a staid construction market. However, it began to reverse this trend from December 2019. Presently, India has a production capacity of 500 million tonnes, while its consumption is estimated to be about 350 million tonnes.
“Same is the case with Andhra Pradesh, which has a capacity of about 80 to 90 million tonnes, while its current consumption is about 36 million tonnes,” he pointed out.
The company anticipates an upswing in cement consumption in Andhra Pradesh, in tune with the projected increase nation-wide, in the next two to three years. “We expect the Government to spend more on infrastructure projects. Even if the Government does not, cement demand will naturally rise,” Mr Swaminathan said.
Cement prices To a question on cement prices, he said for the cement industry, the January to July period was the peak consumption period, as construction activities also peak during this time. He expects the industry to hike cement prices by Rs 15 to Rs 20 per bag during this period.