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BW Businessworld

Concrete Plans

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In 2010-11, Ultratech Cement moved into a consolidation phase, merging Grasim’s cement business with itself and acquiring Dubai-based ETA Star Cement. The move helped Ultratech emerge as one of the top 10 cement companies in the world. In addition, chairman Kumar Mangalam Birla allocated $2.4 billion towards capital expenditure for the next three years in a bid to maintain the company’s leadership position.

Ultratech’s revenues have increased at a compound annual growth rate of 30 per cent to Rs 20,077 crore in the last four years. Maintaining a profit of over Rs 2,000 crore in each of the past three years, the company has achieved a market valuation of over Rs 60,000 crore.

Despite competition and inflationary pressures, the company has continued with its acquisitions and expansion and increased its cement-making capacity to 62 million tonnes per annum (mtpa) from 52 mtpa four years ago. “In the next two years, we expect it to touch 70 mtpa, when all ongoing projects are fully commissioned,” Birla said in the recent annual report.

In the last financial year, Ultratech acquired the 4.8 mtpa Gujarat Cement unit of Jaypee Cement Corporation for Rs 3,800 crore as part of its growth strategy. It strengthened the company’s base in the growing western market, bolstered its coastal footprint and enhanced its exports. As part of its expansion plan, it commissioned a 10,000 tonnes per day clinker plant at Rajashree Cement Works in Karnataka, a 1.6 mtpa cement grinding unit in Odisha and thermal power plants of 30 megawatts at Rawan Cement Works and 25 megawatts each at Rajashree Cement Works and Andhra Pradesh Cement Works at a capex of Rs 2,562 crore.
(This story was published in BW | Businessworld Issue Dated 11-08-2014) ]]>