Birla Corporation Limited (BCL), the flagship company of the MP Birla Group, is planning to increase its cement production capacity to 9.3 million tonnes, including the 1.20 million tonnes proposed capacity increase at Chanderia (Rajasthan) and the 6 lakh tonnes proposed increase in Durgapur (West Bengal). According to company sources, the company has applied to the Union Ministry of Environment and Forests for further increase in the capacity at Chanderia by 1.5 million tonnes. This will take the total cement capacity to 10.8 million tonnes.

BCL's turnover stood at Rs.2,415 crore in 2010-11 against Rs.2,387 crore in the 2009-10. The profit after tax was lower at Rs.319.88 crore against Rs.557.18 crores mainly on account of lower realisation on cement as well as increase in coal and other input costs. At the annual meeting held on Monday, the shareholders approved the payment of a final dividend of Rs.3.50 per share, in addition to the interim dividend of Rs.2.50 already paid.

Chairman Harsh V. Lodha said BCL's profitability was affected because of pressure on prices and also because of the costs of fuel and other inputs. Significant increase in capacities in the industry and poor demand from institutional buyers, including the government, compounded the situation.

During the year, BCL signed a memorandum of understanding with the Assam Mineral Development Corporation (AMDC) for setting up a one-million tonne cement plant in Assam, as joint venture with AMDC. The jute division has done well and there were plans to modernise it.

Timely execution of the capex plans and infrastructural projects will help the company achieve better operational efficiency and volume growth, partly offsetting the margin pressures.

Keywords: MP Birla Group

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