With the government’s thrust on infrastructure development, housing sector, smart cities and roads, UltraTech Cement chairman Kumar Mangalam Birla says the company is well placed to meet the expected rise in demand and participate in the next phase of growth. He was addressing the shareholders at UltraTech’s 15th Annual General Meeting in Mumbai, on Friday
“UltraTech has a strong balance sheet, robust cash flows and gearing levels well within reasonable limits. The company enjoys the confidence of its stakeholders. It has a market cap of over $13 billion. All of these help stoke the company’s future growth and development,” Birla said.
He said that despite the Indian cement industry being snowed under the slowdown in the rural economy, lack of investment from both private and public sector and the overall sluggish demand, the company has been able to sustain its revenues and earnings during FY 2014-15 and in the first quarter of the current fiscal as well.
Birla said that the acquisition of the Gujarat units of Jaypee Cement has been complete, which comprises an integrated unit at Sewagram and a grinding unit at Wanakbori, with a combined capacity of 4.8 mtpa. “The enterprise value of the transaction was Rs 3,800 crore besides the actual net working capital at closing,” he said.
He also said that UltraTech’s board has approved the acquisition of the cement units of Jaiprakash Associates Limited, situated at Bela and Sidhi in Madhya Pradesh. “With this an additional 4.9 MTPA capacity and thermal power generation capacity of 180 MW will be added. This acquisition will raise UltraTech’s cement capacity in India from 60.2 MTPA to 65.1 MTPA. With the on-going projects underway, the capacity in India will grow to 71.2 MTPA by the end of FY 2015-16,” he said.
The company augmented its captive power capacity with the commissioning of 50 MW of thermal power plants and 22.5 MW through waste heat recovery.
This brings the total thermal power capacity to 717 MW and waste heat recovery at 33 MW, which meets around 80% of UltraTech’s total power requirement, he said.