Deepak Khetrapal, MD and CEO, Orient Cement said some of the companies which are highly leveraged are finding it difficult to sustain with the slowing cement demand leading to tight cash flow.
Reliance Cement has been in the market for last three months to sell its 5.8 million tonne per annum cement plant in Maharashtra for an enterprise value of about Rs 5,000 crore. Lafarge´s bid to sell its 5.5 million tonne plant to Birla Corporation for Rs 5,000 crore is stuck since last August with no clarity on transfer of limestone mining lease along with the plant.
Similarly, the Kumar Mangalam Birla-owned UltraTech Cement has sought clarification from the government on transfer of limestone mining lease. Last January, the company agreed to acquire JP Associates´ 4.7 mtpa cement plant in Madhya Pradesh for Rs 5,300 crore.