"The overall growth in the country's cement production and the consequent over supply of the product has also reflected in the state's cement market. Cement price per bag has come down to Rs 160 from Rs 170 last year," managing director NR Subramaniam said.

During the first half, total sales turnover rose to Rs 52.61 crore from Rs 49.01 crore in the previous year. The company's previous highest ever turnover of Rs 51 crore was recorded in 1995-96. The company expects to achieve a sales turnover of Rs 120 crore in the current fiscal, against Rs 113 crore in 1997-98. On the other hand, the company's capacity utilisation went up to85 per cent from 78.5 per cent during the first six months last year. During the period, total cement production improved to 1.79 lakh tonnes as against 1.64 lakh tonnes in the corresponding period last year. Total clinker production rose to 1.75 lakh tonnes, against 1.31 lakh tonnes in 1997-98.

As part of a market intervention strategy, the company, which is the state's lone integrated cement plant, has chalked out expansion plans. Since the state's cement market is more or less dominated by the leading cement manufacturers in the country, the company plans to increase its market share to around 20 per cent by enhancing its production capacity. With an annual production capacity of 4.2 lakh tonnes, the cement major is at present having a market share of nearly 10 per cent.

However, the absence of lime stone source within the state is prompting the unit to set up two clinker grinding units. The clinker grinding capacity of the unit at present is 4 lakh tonnes.

The board of directors has endorsed theproposal for setting up two clinker grinding units, one at Kasaragod and the other at Alappuzha with a total capacity of 4 lakh tonnes. "Our teams have visited certain places in the coastal areas of these districts to locate the sites for the new units, he said.

"The total project cost is estimated at Rs 20 crore. Another proposal which is yet to be given the go-ahead by the board is to enhance the clinker grinding capacity of the existing unit of Malabar Cements. "We can increase the clinkering capacity by 30 per cent to 50 per cent by adding some balancing equipment to the unit. We will soon appoint a consultant to evaluate the additional investment it would entail," he added.

The first five months have shown that the cement consumption has registered a slight increase. During April-August this year, the cement consumption in the state improved to 16.82 lakh tonnes, compared with 15.97 lakh tonnes in the corresponding period last year.