Shree Cement To Spend Rs 20,000 Crore On Capacity Expansion, Says MD Hari Mohan Bangur

Shree Cement Ltd. has planned a capital outlay of Rs 20,000 crore over the next four years as it looks to expand its capacity to 80 million tonne from the current 50 MT, according to Managing Director Hari Mohan Bangur.

Out of the total outlay, Rs 6,000 crore will be funded from the company's bank and the rest through internal accruals, Bangur told BQ Prime's Sajeet Manghat in an interview. "We think we may borrow Rs 3,000 crore to be on the safe side, but that we will decide after six months."

By the end of the financial year, the company plans to increase the capacity to 56 MT, and to 62 MT by the end of next fiscal.

For the quarter ended September, the company's net profit more than doubled to Rs 447 crore and revenue jumped 19% to Rs 4,800 crore year-on-year, according to an exchange filing. "Profit has come because of lower costing," Bangur said.

The prices were almost stable during the quarter, but volume still increased 10% in the July–September period, and roughly 13% during the first half of the fiscal, according to Bangur.

Volume grew in the second quarter despite poor rain. The growth will be better in the next two quarters, which are a part of cement season, he said.

The company aims to increase its revenue by 12% in the current fiscal and that includes a 15% growth from the infrastructure segment and a 10% growth from the housing segment, Bangur said.