UltraTech Cement, an Aditya Birla Group company, plans to invest ₹12,886 crore to add capacity of 22.6 million tonnes per annum with a mix of brownfield and greenfield expansion across the country. The fresh capacity addition comes at a most competitive cost of $76 per tonne.

The commercial production of the new capacity announced on Thursday will go on stream in a phased manner by FY25. Upon completion of the latest round of expansion, the company’s capacity will increase to 159.25 mtpa, reinforcing its position as the third largest cement company in the world, outside of China. The new investment was approved by the board of directors at its meeting held here on Thursday.

Last August, the company announced an investment of about ₹6,500 crore to increase capacities by 19.8 mtpa to 136.25 mtpa from 119.96 mtpa in a phased manner by this fiscal-end.

Doubled capacity in 5 years

Kumar Mangalam Birla, Chairman, Aditya Birla Group said the company has more than doubled its capacity over the last five years and is committed to meeting India’s future needs for housing, roads and other infrastructure. Given the size of the investment outlay, the new capacity creation will have a multiplier effect leading to jobs and growth across multiple regions in India, he added.

The $7.1 billion building solutions company, UltraTech Cement has consolidated grey cement production of 119.95 mtpa. It is the first company in India and the second in Asia to issue dollar-based sustainability linked bonds.

Competition

The fresh capacity expansion comes as Adani Group company plans to make its entry in cement business with the acquisition of Ambuja Cement and ACC with a combined capacity of 65.9 mtpa which will go up to 80 mtpa by 2023. As per the open offer made by Adani Group, Ambuja Cement capacity acquisition is valued at $299 per tonne and that of ACC at $131 a tonne. The current 120 mtpa capacity of UltraTech is valued at $199 a tonne while the 47.4 mtpa capacity of Shree Cement is at $223 a tonne.