Dalmia is expanding its footprint by making a strategic investment about Bharat Limited 3,520 crore, to be funded through loans and internal prosecutors. The cement manufacturer will install a 3.6 million tonnes per year (MTPA) clinker unit and a 3mtpa grinding unit at its plant in Belgaum, Karnataka. It will also set up a 3mtpa capacity Greenfield Split Grinding Unit in Pune, Maharashtra. These units will be commissioned by the March Quarter of FY27.
Along with these, Dalmia is looking at the southern and unused Western Maharashtra markets to complete and improve. Considering these expansion and the ongoing 2.9MTPA capacity expansion in Assam and Bihar, Dalmia’s total installed cement capacity will increase to 55.5mtpa.
Large cement companies are fighting hard competition, forcing them to pursue the market share. Therefore, these expansion are directly positive for domination. However, to meet its vast goal of becoming pan-India cement and achieve 75mtpa capacity by FY28 and to achieve 110–130mtpa by FY31, more and more additions should be one.
Time will tell
“FY28 target means a 14% CAGR (FY24-28), which we consider aggressive, but nothing we have not seen before, the expansion of peers like UltraTech and Ambuja is at a similar rate, about 12% of the circulation annual growth rate (FY24-27) but most of their projects are in advance.”
Given the standing timeline, the broking firm is expected to expand more than Dalmia in 2025.
The management is expected to unveil a detailed capital allocation scheme by July to reach the 75MTPA target. This helps in increasing visibility on the company’s long -term development. With the assets of Jayaprash Associates, the concerns on capacity expansion have weighed the feelings of investors. In the December quarter (Q3Fy25) Income Call, the management said that FY25 capital expenditure is almost 3,000 crore with expected of uniform level in FY 26.
Meanwhile, Q3Fy25 volumes were ineffective, which was about 2% to 6.7 million tonnes from year to year. Its major markets in South and Eastern India continued to face pricing pressure as the competition suffered injuries. These issues have placed stock on the back leg, falling 17% during the last one year.
Dalmia shares are tampering with their 52-week lower levels It was seen in 1,651.40 June. In addition to pricing trends, a meaningful re-painting in stock hinges on its strategy to reach a large extent set goals.
