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Ambuja Cements to Invest 1,000 Cr. in a 4 MMTPA Grinding Unit

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Ambuja Cements Ltd., part of the Adani Group, will be setting up a 4 Million Metric Tonne Per Annum (MMTPA) Cement Grinding unit in Jharkhand. The estimated cost of this project has been pegged at Rs. 1,000 crore.

This information was given by Ambuja Cements in a press release dated 21st February 2024.

Grinding Unit to be Set Up in Proximity to Adani Power Jharkhand, Fly Ash to be Recycled

Ambuja Cement’s upcoming grinding unit will be set up in Motia village of Jharkhand’s Godda district, near Adani Power (Jharkhand) Ltd.’s 1,600 MW Ultra-supercritical Thermal Power plant. As per Ambuja Cements, this is a “…comprehensive approach to disposing of fly ash in an environmentally safe manner and contributing to the circular economy”.

Fly ash, which is discarded from thermal power plants, can be used in the cement & concrete industry. Typically, fly ash can be added to Portland Cement Concrete (PCC) to increase cost-effectiveness and durability of the concrete.

Significant Milestone in Expanding Presence, Socio-Economic Development of Region – CEO, Adani’s Cement Business

Mr. Ajay Kapur, CEO of Adani Group’s Cement Business, said that through this new cement grinding unit the company “…intends to achieve a significant milestone in our commitment to expanding our presence and contributing to the socio-economic development of the region”.

It is estimated that the aforementioned grinding unit would open up about 2,500 direct and indirect employment opportunities.

Godda district of Jharkhand has a sizeable tribal population, and the literacy rate of the district sits at around 56.40% (as per Census 2011). The chief economic occupation of the people is agriculture. Therefore, Ambuja Cements’ plant is expected to have a positive socio-economic impact on the region.

Ambuja Cements’ Stock Continues to Gain after New Plant’s Announcement

Cement

Ambuja Cements’ stock has been on an upward trajectory since the announcement of the aforementioned CapEx in Jharkhand. The company’s shares were trading at Rs. 587.80 apiece on 21st February 2024, which has increased to Rs. 608.60 apiece as on 26th February 2024. This reflects a 3.54% increase over a period of 4 trading days.

New Cement Grinding Unit to Serve Ambuja Cements’ FY-28 Production Target

Ambuja Cements has set a target of achieving 140 MMTPA cement production by FY-28. As of 31st December 2023, Ambuja Cements’ consolidated cement production capacity sits at 77.4 MMTPA. Ambuja Cements’ investor presentation for Q3 of FY-24 states that about 32 MMTPA of cement production capacity is currently under implementation, and once commissioned, the company’s production capacity would touch 110 MMTPA.

In Jharkhand, Ambuja Cement already has two cement plants, which have a cumulative capacity of 6 MMTPA. Therefore, the aforementioned Cement grinding unit, which will be the company’s third facility in Jharkhand, is a step towards augmenting Ambuja Cements’ consolidated production capacity.

About Ambuja Cements Ltd.: Ambuja Cements Ltd. became a part of the Adani Group in September 2022. A major Indian manufacturer of cement, the company reported a revenue of Rs. 38,937.03 crore for fifteen months ended 31st March 2023 (entire FY-23 and three months post acquisition by the Adani Group).