Reliance Cement, which is part of Anil Ambani’s Reliance group has taken indirect control of the Durgapur based Ma Chandi Durga Cement Pvt. Ltd. The deal with the Kolkata-based Kedia family, which owns the cement manufacturing unit in Durgapur was concluded in February this year and announced at a press conference in Kolkata on Wednesday (21 May).
Atul Desai, a director and chief marketing officer at Reliance Cement Co. Pvt. Ltd said that the Reliance group has an irrevocable right to gain control of Ma Chandi Durga Cement whenever it wishes to exercise it. He, however, refused to specify when his company could take direct control of the cement manufacturing unit at Durgapur.
“It’s a one-year old plant built with inputs from Holtec, so it meets our quality standards,” Desai said, referring to one of the leading consultants to the cement industry—Holtec Consulting Pvt. Ltd. Reliance Cement will use the Durgapur factory to set foot in West Bengal, where, subject to clearances, it proposes to build a 2.1 mt plant in Purulia district. It has already got possession of a 100-acre plot for the proposed unit.
The enterprise value of the Durgapur unit is estimated at Rs.60-70 crore, according to an industry expert. To set up a half-a-million tonne unit will cost around Rs.100 crore, this person said, asking not to be named. There are bottlenecks and the Durgapur unit may not be running at its peak capacity as of now, he added.
Ma Chandi Durga Cement Pvt. Ltd situated at Bamunara of Durgapur with a current production capacity of 0.5 million tonnes per year will soon see a capacity expansion to 1 million tonnes of cement per year. Reliance Cement will supply limestone to the Durgapur factory from its mines in Madhya Pradesh.
This is the first of its kind of expansion in Durgapur by the Reliance group.