Jaypee left with three-fourths of cement capacity

Aug 27 2014, 01:36 IST
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SummaryWith the sale of its 1.5 mtpa cement unit at Panipat to Shree Cement, Jaiprakash Associates’ is now left with just three-fourths of the installed operational capacity it had till last fiscal year and strong foothold in just central India.

With the sale of its 1.5 mtpa cement unit at Panipat to Shree Cement, Jaiprakash Associates’ is now left with just three-fourths of the installed operational capacity it had till last fiscal year and strong foothold in just central India.

With the divestment of its third cement unit in less than a year, JAL’s presence in northern and eastern India have come down to 4.7 mpta and 2.2 mtpa, respectively, even as its market share in the western region is now totally wiped off. This leaves the company with major assets in central and southern regions where its capacities are around 13.25 mtpa and 5 mtpa, respectively.

With southern region already suffering from over capacity glut and low utilisation levels, any further divestment of cement assets may happen in the central region. Central India is the only region where Jaiprakash Cement still is the market leader with nearly 27% market share based on total regional installed capacity while Ultratech — the largest cement producer in India — has got just over 11% share.

According to a June Bloomberg report, Ultratech Cement was in talks with the Jaypee Group for buying the latter’s cement assets, including 7 mtpa Rewa complex in central India. Shares of Jaiprakash Associates on Tuesday closed down 4.83% at R49.30 on BSE.

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