Wednesday, June 29, 2022
BusinessDecline in cement stocks, shares of cement companies fell due to expansion...

Decline in cement stocks, shares of cement companies fell due to expansion plan of UltraTech Cement

UltraTech Cement has passed a budget of Rs 12,886 crore to increase the production capacity of the company.

Cement stocks Price: Shares of cement companies are trading in red mark on Friday. Earlier it was reported that UltraTech Cement has passed a budget of Rs 12,886 crore to increase the production capacity of the company.

A week before this, the Adani Group had announced to buy stake in Holcim Cement Company (Holcim). After the announcement of capacity expansion of UltraTech today, almost all cement stocks are trading in the red mark.

At 10.40 in the morning , shares of UltraTech cement are trading at Rs 5812.20, down 3.21% i.e. about Rs 198.30.

  • Shares of Ambuja Cements are trading at Rs 367, down 1.75% i.e. around Rs 6.55.
  • Shares of ACC are trading at Rs 2164.45, down 1.56% i.e. Rs 34.40.
  • India Cements shares are trading at Rs 164.95, down 2.25% i.e. Rs 3.80.
  • Shares of Shree Cements are trading at Rs 20,750, down 4.14% i.e. Rs 885.75.
  • Shares of Ramco Cements are trading at Rs 664.40, down 4.50% i.e. Rs 30.75.
  • Shares of JK Lakshmi Cement are trading at Rs 436.45, down 2.70% or Rs 12.10.
  • Dalmia Bharat shares are trading at Rs 1292.60, down 5.88% i.e. around Rs 81.25.
  • Shares of JK Cement are trading at Rs 2,197.40, down 6.08% i.e. Rs 145.35.

Ultra Tech Cement has decided to invest Rs 12886 crore (about $1.65 billion) to expand its production capacity. This will increase the total production capacity of the company by 22.6 MTPA. This capacity expansion will be done both in brownfield (increasing capacity of old unit) and greenfield (setting up of new unit).

UltraTech Cement, while informing the exchanges about this, has further said that this expansion plan was approved in the company’s board meeting held on Thursday. For this investment to meet future requirement, the company will raise money from debt and its internal sources.

Read Also | Adani acquires ACC & Ambuja Cement for $10.5 billion

The company will set up bulk terminals along with setting up integrated grinding units under this expansion plan. The company has also said that these new units are likely to start production in different phases by the year 2025. At present Ultra Tech has a production capacity of 119.95 MT per annum.

But after the completion of this expansion plan, the total production capacity of the company will be 159.25MPTA.

On this occasion, Kumar Mangalam Birla, Chairman, Aditya Birla Group has said that this ambitious capacity expansion plan of the company will prove to be a milestone in the company’s growth journey. The company has doubled its production capacity in the last 5 years. The company is committed to meet the needs of India’s future housing road and other infrastructure sectors.

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