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JK Cement will spend Rs 1,161 crore over the next two years to expand its existing capacity by 5.5 million tonnes per annum (MTPA).

Out of this, 2 MTPA capacity will be added to its existing plants while one split grinding unit of 1.5 MTPA is also proposed.

A new split grinding unit of 2 MTPA will also be set up in the company's wholly-owned subsidiary Jaykaycem. Enhancement of clinker capacity by 2,000 tonnes per day or 0.66 MTPA in Jaykaycem is also proposed.

The funding for the same will be done through a mix of debt and internal accruals. JK Cement's current capacity stands at 14.67 MTPA with 2 MTPA of Jaykaycem and another 2 MTPA which is under implementation. Utilisation levels at 84 percent are subject to market demand.

In an interaction with CNBC-TV18, JK Cement's COO Rajnish Kapur said that the company is witnessing an uptick in private Capex and that the rural market, which was an underperformer, is showing the first signs of revival.

"We are expecting that in case a good MSP is given for the next crop which will help us. But I think it's a mix of all - it's not just one sector, which is primarily driving," he added.

Also Read: JK Cement starts operations at manufacturing unit in Madhya Pradesh

For the September quarter, JK Cement's overall sales increased 18 percent from last year while profit reported a 26 percent drop due to higher input costs.

The cement maker's EBITDA margin declined close to 400 basis points from last year to 13.7 percent due to higher power and fuel as well as freight & handling costs.

Power and fuel costs rose 60 percent from last year while freight and handling costs were up 17 percent.

Shares of JK Cement are trading at 3.5 percent higher at Rs 2,916.

(Edited by : Rukmani Krishna)

First Published:Nov 14, 2022 12:46 PM IST