Chennai-based cement producer India Cements announced on Friday its decision to monetize its land assets in an attempt to repay debt and for capital expenditures. The company has an outstanding debt of Rs 3,000 crore in its books per. March 31, 2022. It owns about 26,000 acres and has set up an internal group to monitor the revenue process. With the aim of upgrading some of its older facilities, a certain amount will be collected through land sales.
N Srinivasan, Vice President & MD, India Cements, told a select group of media people that the sale of land will only happen at the right price. “I have 26,000 acres of land. I am not a distressed seller. I have appointed a team of experts to decide. The amount will be used to repay the debt and make some improvements to its facilities,” he said.
Last fiscal year, the company repaid Rs 551 crore, and this year it planned to repay Rs 500 crore. There would be no change in its planned capex, he said, adding: “I may only sell the land to the extent I need. We have land in the city, outside the city and in the countryside.”
India Cements will resort to price increases in three phases next month in an attempt to stay afloat. “My OPC / PPC mix also changed, affecting production costs. My costs increased. To compensate for the cost increase, I have decided to increase the price per. bag on June 1, June 15 and July 1 with DKK 20, 15 and 20, respectively. Whether others want to support me or increase the price, it must be seen, ”he said. According to Srinivasan, the average price of cement in the South ranged from Rs 320 to Rs 400 per bag.
He said most cement companies in the south operated with 40-50% capacity. “If the cement does not disappear from here, the Nordic region will face a huge shortage in a few years,” he said. Srinivasan praised the Union’s finance minister for supporting their demands, saying he hoped something positive would come soon.
