Vicat to invest Rs.1,300 crore at Gulbarga cement plant
Hyderabad, Jan 30 : Vicat Group, an international cement manufacturer, will build a second unit at its greenfield cement plant in Gulbarga district of Karnataka with an investment of Rs.1,300 crore.
The second unit, with a capacity of 2.75 million tonnes per annum, will come up in two to three years, said Gilles du Manoir, country head-India, Vicat Group.
The plant at Chatrasala Village commenced production a few days ago when the first line with a capacity of 2.75 million tonnes per annum became operational.
A joint venture between Vicat Group, France, and Sagar Cements, the plant will ultimately have a capacity of 8.25 million tonnes per annum. The second phase of the project, with two more units, is expected to be completed in three to four years.
Announcing the launch of its Bharathi brand cement in the Telangana region of Andhra Pradesh here Wednesday, he told reporters that the company invested Rs.1,800 crore in the first line with a debt equity ratio of 35:65.
With the commencement of Gulbarga plant, Vicat Group's capacity in India has gone up to 7.75 million tonnes per annum.
It already has a joint venture with Bharathi Cement, in Kadapa district of Andhra Pradesh with five million tonnes capacity which has been in operation since 2009.
The cement from the Gulbarga plant will be used for domestic consumption, the focus markets being north Andhra Pradesh, north Karnataka and Maharashtra.
M. Ravinder Reddy, head marketing-India, Vicat Group, said the Kadapa plant was running at 50 percent capacity due to electricity shortage.
The Gulbarga plant will operate at 60 percent capacity in the first year. Vicat Group has a sales target of 4.5 million tonnes from both the plants during 2013.
Manoir evaded queries relating to its plans for further acquisitions in India and about the likely impact from the ongoing Central Bureau of Investigations (CBI) into Bharathi Cements owned by YSR Congress party president Y.S. Jaganmohan Reddy, who is in jail in an illegal assets case.
He said Vicat's investment decisions were clean. The French company in 2010 acquired 51 percent stake in Bharathi Cements. It earlier joined hands with Hyderabad-based Sagar Cement for 53 percent stake in joint venture.
Vicat, which had revenues of 2,265 million Euros in 2011, operates in France, Switzerland, Italy, the US, Turkey, Egypt, Senegal, Mali, Kazakhstan and India.