Wednesday, March 22, 2006
HeidelbergCement enters India
HeidelbergCement concluded a 50:50 joint venture agreement in India, consisting of the grinding plant of Indorama Cement Ltd, owned by the Indorama S P Lohia Group, and located in Mumbai (Bombay) on the West coast of India.
The plant, which was built in 2000, has a cement capacity of 750,000 tonnes and is in very good technical condition. It has an excellent market position in the vicinity of the big markets of Mumbai (17 million residents) and Pune (5 million residents). Due to its location next to a steel plant of the Ispat Group, led by Mr. P.K. Mittal and Mr. V.K. Mittal, Indorama has also direct access to blast furnace slag, which is an important factor for sustainable and cost efficient cement production. Indorama is the only producer of high quality slag cement on the Mumbai market; the company operates also a terminal near the Mumbai harbour. The approval procedure for the construction of a clinker plant in the neighbouring federal state of Gujarat has been started. Representatives of HeidelbergCement in the Indorama management are included in all important decisions.
For HeidelbergCement, this is the first important step on its way to a long-term market position on the Indian growth market. In the past ten years, cement consumption in India grew by approximately 7.5% per year. The building industry developed very dynamically, driven by the strong growth of population and the quick expansion of infrastructure. In 2005, India was after China the second largest cement consumer with around 135 million tonnes. Since per capita consumption of around 125 kg is one of the lowest in Asia, an average growth of 8 % to 9 % is expected for the years to come.”The cement grinding plant in Mumbai is our entrance gate to India”, says Dr. Bernd Scheifele, Chairman of the Managing Board of HeidelbergCement. “Step by step, we intend to expand our activities on this very promising market. The acquisition in India is in line with our strategy to invest specifically in growth markets”.