Dalmia Bharat readying next phase of expansion to be pan-India player.

Cement manufacturer Dalmia Bharat Ltd., which is currently executing an expansion plan, is working on its next phase of expansion that will take its capacity to 75 million tonnes per annum (mtpa) by 2027 and set it on its course to be a pan-India player.

Under its current expansion plan, it will be reaching an annual capacity of 54 mtpa by the end of FY24, from its current capacity of 39 mtpa. 

In a recent meeting with select analysts, the company’s management said that it was firm on allocating capital for its core businesses while it would be divesting non-core holdings such as its stake in India Energy Exchange to focus on its growth. It has sold about 5 per cent stake in the energy exchange and still holds about 15 per cent stake in it.

Over this financial year and the next, the company’s capex of about ₹10,200 crore will be partly met through operating cash flows of ₹6,400 crore.

Dalmia Bharat’s management expects cement demand to grow faster than the country’s GDP and the expansion plans that have been set in motion will equip it to meet that demand and aid it in its goal of becoming a pan-India player.

Through its expansion, the company aims to reduce its exposure to the east-south region of the country and by the end of 2024 to be present in the western, mid, and northern regions as well.

The current capacity expansion includes the 5 mtpa added through the acquisition of some assets of JP Associates by Dalmia Bharat’s subsidiary, Dalmia Cement Bharat. It also expects to acquire another 4 mtpa from JP Associates.

Laying the groundwork for its next phase of expansion, Dalmia Bharat has been actively participating in limestone auctions. To reduce its dependence on Coal India for its coal requirements, the company is also in line to acquire coal mines.

HBL