Dalmia Bharat Cement aims to become pan-indian player

Dalmia Bharat Cement is planning to expand beyond southern and eastern India and become a pan-indian player by setting up units in the western and northern parts of the country.

The firm is set to make its debut in Maharashtra by acquiring Murli Cement through the corporate insolvency route, while in Rajasthan, it is acquiring land to put up a plant in the region.

Ujjwal Batria, chief operating officer, has said that while its plans for Murli Cement acquisition has been approved by the National Company Law Tribunal (NCLT), it has come with certain riders, which is being deliberated upon.

Dalmia Bharat has asked for the mining lease belonging to Murli Cement to be transferred in its name, along with the incentives enjoyed by Murli Cement, if it is to acquire the west-based company.

Although the NCLT Mumbai Bench approved Dalmia Bharat’s plan of acquisition, it rejected a clause which facilitated Dalmia Bharat to call off the deal at any stage and instead has asked it to prevent Murli Cement’s liquidation. Sources said Dalmia Bharat’s offer for Murli Cement stands at around ~400 crore, while the liquidation value of Murli Cement is pegged at around ~230 crore.

While this acquisition will open up the Maharashtra and Gujarat market for the company, a plant in Rajasthan will help it foray into the northern market as well.

The company has mining leases in Rajasthan and it is in the process of purchasing land. "We can get into this market at any point of time when we think it is right," Bataria told this newspaper.

The idea of a greenfield project in Rajasthan came up in November last year when Dalmia Bharat eventually failed to acquire the 6.5 million tonne per annum (mtpa) Binani Cement and mooted an idea to opt for a 4 mtpa plant in two phases.

While the cost of the plant is being worked out, had the Supreme Court allowed Dalmia Bharat control of Binani Cement, the former would have spent around ~7,000 crore to enter this highly-competitive region.