Ultra Tech plans Rs1,424 crore investment; pays 17.5 per cent dividend
28 Aug 2006
Mumbai: UltraTech has lined up investments of Rs1,424 crore involving the setting up of two captive power plants at its Gujarat and Chhatisgarh units and creation of an additional four million tonne capacity at its plant in Andhra Pradesh.
"The company has earmarked a capex of around Rs1,424 crore to be spent over the next three years. Of this, Rs844 crore is towards the installation of captive power plants at its units in Gujarat and Chhatisgarh. To cater to the growing demand for cement and grow its market share in South India, we will additionally invest Rs1,274 crore towards a four million tones per annum capacity expansion at UltraTech's plant in Andhra Pradesh. This is inclusive of setting up of a 1.30 million tones per annum split grinding unit and a 46 MW captive thermal power plant," Kumar Manglam Birla, chairman, told the company's fifth annual general meeting.
Ultratech also declared a dividend of Rs1.75 per share, up 133 per cent from Rs0.75 per share paid in the previous year. The total outgo on account of dividend, inclusive of corporate tax works out to Rs24.85 crore as against Rs10.60 crore in the previous year.
Birla said UltraTech would focus on optimising efficiencies, leveraging logistic benefits, higher use of alternative fuels and a thrust on value-added product mix.
"The government's initiatives on infrastructure development and the boom in the housing sector are major growth drivers for the cement industry', he said.
While the Indian Cement sector is the second largest in the world after China, he said, "the per capita consumption of cement in India is just 125 kg, which is very low in comparison with the average world consumption of 267 kg, and underlines its tremendous growth potential".
In the medium term, he said, the demand and supply situation is expected to be in balance, with a couple of years before the next cycle of new capacity enters the market.
Ultra Tech's net revenues, at Rs3,299 crore, grew by 27 per cent from against Rs2,607 crore in the previous year. Profit before tax and provision for diminution in investment stood at Rs286 crore compared to Rs43 crore in the previous year. Profit after tax was Rs230 crore as against Rs3 crore in the previous year.
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