Ambuja Cements' two grinding projects cost may rise by 10pc

MUMBAI: Ambuja Cements, which is setting up two grinding units at Bhatapara in Chattisgarh and Rauri in Himachal Pradesh, said the project cost would shot up by 10 per cent from earlier estimates of Rs 1,600 crore due to increased commodity prices.

"The total investment in these projects has escalated by around 10 per cent, mainly due to the steep cost increases for steel and civil engineering during the year," Ambuja Cements said in its annual report.

Ambuja Cements had earlier said that the cost of putting up these plants, having a total capacity of 4.4 million tonnes, would be approximately Rs 1,600 crore.

"Both the units are on track," Ambuja Said, adding that the Bhatapara unit would go on stream in the middle of 2009 and the Rauri unit by the end of the current year.

Ambuja Cements, which produced 17.8 million tonnes of cement last year, increased clinker production capacity at its Rabriyawas facility last year through upgradation, but this was offset by lower production as a result of unplanned stoppages at the Maratha and Darlaghat plants.

As a result, the net increase of its total clinker production in 2008 was just one per cent at 11.5 million tonnes. It had to continue clinker purchases last year to feed the grinding units at Farakka and Sankrail.