HS Singhania Group's JK Lakshmi Cement is to expand its capacity at Rs 2,100-crore, to be largely funded by debt. Shailendra Chouksey, Whole-time Director said that the biggest portion of the expansion project – to cost Rs 1,550 crore – would entail the setting up of a 2.7-million-tonne-a-year (mtpa) greenfield project at Durg in Chhattisgarh. This would include a captive limestone mine and two grinding units.
The Durg project would use Bhilai Steel Plant’s slag. Rs 200 crore towards loan repayment in FY13 has helped restrict the firm’s debt equity ratio to 1.09:1, as against 0.96:1 in FY12, Chouksey said. The company has, so far, invested around Rs 800 crore in the project. It, along with the second grinding unit in Odisha, it will be operational in early FY 2015, he said.
Commissioning of the Durg project will take the total installed cement capacity to 8.5 mtpa from the current 5.3 mtpa.
The project is meant to help the company penetrate the eastern market. In the next leg of eastern expansion, the company has decided to put up a grinding unit in the Asansol-Durgapur region of West Bengal. Rajasthan-registered JK Lakshmi is also setting up its second unit in Gujarat, at Surat, at a cost Rs 150 crore.