Adani Group-owned Ambuja Cements is set to expand its clinker capacity by 8 million tonnes at its Bhatapara and Maratha units, the company announced on Friday. In a stock exchange filing, the company said that it will place orders for the capacity expansion and that the projects are expected to be commissioned in nearly 24 months. The total cost of the project will be funded by the company’s internal accruals.
“The capacity expansion projects will enable the production of Blended Green Cement of 14 million tonnes, post all requisite approvals,” the company said in its statement. The brownfield expansion projects are part of the company’s strategy aimed at doubling the production capacity over the next five years from the current capacity of 67.5 MTPA.
The move is expected to help the company keep pace with rising demand for cement in India, which has been experiencing rapid growth in infrastructure projects and housing construction. The expansion is also expected to support the company’s efforts to produce green cement, which is becoming increasingly important as the country seeks to reduce its carbon footprint.
Green cement is an eco-friendly alternative to traditional cement, which is made by reducing the amount of clinker used in the production process and replacing it with other materials. This results in a reduction in CO2 emissions and energy consumption during production.
Ambuja Cements has been working to improve its sustainability profile in recent years and has set a target to reduce its carbon dioxide emissions by 30% by 2030. The company has also been investing in renewable energy projects and has installed wind turbines at its various facilities to reduce its dependence on fossil fuels.
The expansion is also expected to benefit the local economy, as it will create new jobs and generate business opportunities for suppliers and contractors in the area. Ambuja Cements is one of the largest cement producers in India and operates 12 cement plants across the country.
The company’s move to expand its capacity comes at a time when cement prices in India are on the rise due to a shortage of supply. The COVID-19 pandemic has disrupted supply chains and logistics, leading to a slowdown in production and distribution of cement. However, with the easing of lockdown restrictions, demand for cement has picked up again, leading to a shortage in some parts of the country.
According to data from the Cement Manufacturers Association, cement production in India increased by 14.6% to 29.32 million tonnes in March 2022, compared to the same month in the previous year. The increase in production was largely driven by the rise in demand for cement in the infrastructure and housing sectors.
Ambuja Cements, a subsidiary of the Adani Group, has announced plans to expand its clinker capacity by 8 million tonnes at its Bhatapara and Maratha units. The company plans to use the additional capacity to produce blended green cement of up to 14 million tonnes, subject to all required approvals. The brownfield expansion projects are part of Ambuja Cements’ strategy to double its production capacity over the next five years from the current 67.5 million tonnes per annum.
The company said that the expansion projects are expected to be commissioned in approximately 24 months and the capital expenditure required for the expansion will be funded through internal accruals. The move is expected to help Ambuja Cements strengthen its position in the Indian cement industry, which is currently the second-largest cement market in the world after China.
Ambuja Cements is not the only company in India to announce expansion plans recently. Other major cement producers in the country, including UltraTech Cement and Dalmia Bharat, have also announced plans to increase their production capacity to meet rising demand. With the Indian economy expected to continue growing at a rapid pace, the demand for cement is likely to remain strong in the coming years, creating opportunities for cement companies to expand their operations.
