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Sagar Cements Ltd is expecting Greenfield units of Satguru Cement Pvt. Ltd and Jajpur Cements Pvt. Ltd to be commissioned in the second quarter of next fiscal.
According to Sreekanth Reddy, Joint Managing Director, Sagar Cements the work ”is progressing as per schedule” and the company expects the units to be commissioned before the end of Q2 FY22.
Hyderabad-based Sagar Cements announced the acquisition of 100 per cent stake in Odisha-based Jajpur Cements Private Ltd (JCPL) besides a 65 per cent stake in Indore-based Satguru Cements Private Ltd (SCPL).
As part of the pact, Sagar is investing ₹150 crore in SCPL to set up a greenfield cement manufacturing plant of one million tonne capacity along with a waste heat recovery power plant at ₹426 crore. It will be holding 65 per cent in the equity share capital of SCPL upon completing these projects.
It is also investing ₹108 crore in JCPL in a phased manner to acquire 100 per cent shareholding in it and set up a greenfield grinding unit of 1.5 million tonnes in Jajpur at ₹308 crore.
Capex
For the current fiscal, Sagar plans to invest close to around ₹400 to 450 crore as we are implementing two projects. ``Out of this we have already done 300 crores in the current year so far, likely that we might end up spending another 125 crores in the current next two months that is in the current quarter itself,’’ he said.
The commissioning of Satguru and Jajpur should help Sagar further rationalise its freight mix and aid in enhancing product mix and accessing faster growing markets.
On the Covid impact, Reddy said the company was just coming out of it. ``But I think we should, by the end of the year in the markets that we operate, should end up being anywhere between 7.5 pc to 10 pc lower than the last year,’’ he said.
The markets of AP, Tamil Nadu, Karnataka and Kerala were "fairly doing well," Reddy said.
"The only market that we have seen slightly slowdown is the Telangana market, the primary reason being that the government spends in most of the other places is relatively higher compared to Telangana,’’ he added.
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