Birla Corp to invest $1 bn to ramp up production capacity | The Financial Express

Birla Corp to invest $1 bn to ramp up production capacity

The company plans to set up of a 4 million tonne per annum greenfield project, brownfield expansion of existing capacities by another 4 million tonne per annum, and debottlenecking of existing facilities to add another 2 million tonne per annum of output capacity.

Birla Corp to invest $1 bn to ramp up production capacity
At the end of April, the company’s subsidiary RCCPL Pvt Ltd started commercial operations at its 3.9 million tonne integrated cement plant at Mukutban in Maharashtra.

Birla Corporation, an MP Birla Group flagship, is planning to invest at least $1 billion over the next eight years to ramp up its production capacity to 30 million tonne by 2030. The cement maker’s production capacity currently stands at around 20 million tonne per annum.

The capacity addition would be by way of greenfield and brownfield projects as well as debottlenecking across its various plants, Birla Corporation chairman HV Lodha told mediapersons after the company’s annual general meeting (AGM).

The company plans to set up of a 4 million tonne per annum greenfield project, brownfield expansion of existing capacities by another 4 million tonne per annum, and debottlenecking of existing facilities to add another 2 million tonne per annum of output capacity.

At the end of April, the company’s subsidiary RCCPL Pvt Ltd started commercial operations at its 3.9 million tonne integrated cement plant at Mukutban in Maharashtra. With it, the company’s consolidated annual production capacity stands augmented to almost 20 million tonne, a jump of more than 20% from its previous capacity, Lodha told shareholders during the AGM.

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“In terms of borrowings, we managed the Mukutban capital expenditure quite well. The company’s total debt stood at `4,208 crore at the end of March, only marginally higher than a year earlier despite fresh borrowings of `462 crore on account of Mukutban. Your company has managed to consistently reduce borrowing costs, and at the end of June, overall interest rate stood at 6.68%. This is 65 basis points lower than a year earlier,” he said.

Lodha said during the last fiscal, the cement maker was able to scale up sales to top 14 million tonne for the first time in the company’s history, but profitability came under immense pressure as margins for the entire cement industry contracted by 400 to 500 basis points.

“Input costs, which started to shoot in 2021-22, continue to impact profitability in the current year as well. Things may not look up immediately, but post Diwali, we are hopeful of a robust turnaround,” he added.

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