Binani Cement Limited has become the first Indian Cement Manufacturing Company to enter the ever expanding markets of China with its dedicated Cement production facility in Shandong province in North China. Binani Cement Limited has bought 49% stake with management control in an ongoing Cement Manufacturing Plant in China having reserves of 148 mn tons of limestone in the nearby mines for US$ 11 million. Binani Cement has invested in a running virgin cement plant in China. This plant has a present clinker capacity of 0.5 Million Tonne Per Annum (MTPA) and cement of 0.3 MTPA which will be scaled to 2.2 MTPA in the next 2 years. BCL?s cement plants are situated in Binanigram, Pindwara, Sirohi, Rajasthan. In order to reduce freight cost the second grinding mill is being setup in Neem Ka Thana closer to Haryana and the adjoining NCR region.
Vinod Juneja, is Deputy Managing Director in Binani Metals and Financial Advisor in Binani Cement. Prior to this, he was Deputy Managing Director, Bank of Rajasthan.
He started his banking career from Syndicate Bank. Later he joined Export-Import Bank (EXIM Bank) during the period 1981 to 1989. His other stints include SANWA Bank of Japan, Choung Bank of South Korea. He was also associated with Sumitomo Bank of Japan (now known as Sumitomo Mitsui Banking Corporation - after merger of Sakura Bank) as Dy. CEO.
Replying to Anil Mascarenhas of India Infoline, Vinod Juneja says, ? In spite of the new capacities being added to the cement plants there would be wide difference in demand and supply.?
What are the trends being witnessed in the cement sector?
Looking to the industrial growth, the trends will remain upwards because of wide difference in demand and supply due to sudden spurt in construction activities, infrastructure development, i.e., highways, air ports, ports, urban housing etc. in spite of the new capacities being added to the cement plants.
What growth do you see for the next two to three years?
This trend will continue to persist in the coming years. The cement demand is expected to grow by 10% for the next three years due to limited capacity additions to cater the increased demand.
Are the projections about infrastructures development getting reflected in the cement demand? What is India?s per capita cement consumption compared to other countries?
Due to huge potential for the infrastructure development in India, the demand for cement will continue to remain on higher side. Secondly, per capita cement consumption in India is 125 kg as against 800 kg of China, 960 kg of South Korea and 450 kg of Thailand, which again shows the huge potential for growth in cement industry.
What is the current clinker production per day from the new unit you have commissioned recently?
The new unit was commissioned in the last week of July?07. Plant operations stablised in a very short span and now the kiln is running at more than 6000 TPD clinker production and by the end of the financial year, it is expected to achieve the level of Kiln at 7000 TPD.
What is the production estimate for FY08 and FY09 ?
For financial year ?08, the cement and clinker sale is estimated to be 3mn tons and 0.6mn tons respectively. The expected cement production for FY09 is 6mn tons per annum
What is your call on cement prices in the current year and next year ?
We see it upwards, as input cost will increase mainly due to increase in prices of fuel & energy. Considering an expected production and consumption growth of 9 to 10 % during this year, demand supply position in cement industry is expected to improve from 2008-09 onwards resulting in an expected price stabilisation.
When do you expect the next round of cement price increase in the northern market?
We see it happening very soon
What is the current wholesale and retail cement price per bag of 50 kg in various northern cities like New Delhi, Jaipur, Chandigarh ?
What is the state wise cement sales at present and what are the expectations for financial year 2009 ?
Our State-wise Cement sales are as under:
Expected in 09
Any plans to dilute stake ?
We have no immediate plans. We will do it at appropriate time, when further expansion comes up.
What is the update on your Captive Power Plant at Binanigram ? What is the capacity and utilization?
Present capacity of CPP is 20 MW. Two new CPPs each of 22.3 MW have been added and the total capacity after commissioning will become 64.6 MW. Present capacity utilization of the existing unit is 105%.
What opportunities are you exploring in alternative source of energy?
It is the endeavor of the company to maximize the use of alternative fuels. Company has developed the system to feed Alternative fuels directly to the pyro process. Presently, we are using Agro waste, Effluent plant sludge to lower the cost of production and reduce the carbon emission. The company has already got the host country approval for Alternative Fuel Project.
Give us details about your real estate business in Wada?
In Wada we have got a land of approximately 56 acres. We would look at how the same can be utilized for real estate.
By when do you see your subsidiary BT Composites turning around? What is the outlook for this company ?
This company future is bright, product is in demand and with modification and improved technology, the factory will have a turnaround in next 18 months.
What progress have you made in finding strategic partner for Goa Glass Fibre?
We have given mandate to some of the consultant and awaiting the result.
Are you looking at getting active in Wind Energy and Filament winding ?
We have no immediate plans.
Your dividend policy ?
We are following the company law practice for dividend and as and when we have profit we will share with our share holders.
Your message to shareholder?
The cement capacity in Binani from Udaipur is operational and the impact of new line and new furnace will be visible from 2009. The Gujrat Green field project is also going to be finalised. Company will require the share holder?s support, confidence and trust in the company to continue and we are confident that our share holders will be rewarded suitably.