BUDGET IMPACT: CEMENT SECTOR
Article Abstract:
The Government of India plans to use 50 percent of the cess levied on diesel in the development of roads, which will increase the consumption of cement and concrete. It has also restored 100 percent Modvat for the cement sector. The customs duty on imported coal has been increased to 16.5 percent from 15 percent. The cost of coal for the Gujarat Ambuja Cements and Larsen & Toubro will increase by Rs5 per tonne. The price of coal in India will also increase by Rs7 per tonne due to the hike in the price of railway freight. As the Associated Cement Companies, Grasim Industries and Larsen & Toubro transport cement by rail, the price of their cement will increase. The Government's focus on industrialisation of villages will increase the demand for cement from rural areas, which account for 20 percent of the total demand. Budget has offered tax holiday to the north- eastern States, which is likely to increase the consumption of cement. (rk) (kvr)
Comment:
The Government of India plans to use 50 percent of the cess levied on diesel in the development of roads, which will increase the consumption of cement and concrete.
Publication Name: Dalal Street Journal
Subject: Business, international
ISSN:
Year: 1999
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MANGALAM CEMENT - STAY AWAY
Article Abstract:
Mangalam Cement of the BK Birla group has proposed to float a rights issue of 14 percent optionally convertible cumulative preference shares (OCCPS) of Rs10 each for cash at par. The proceeds of this issue will be used to pay the over-due interest on term loans accrued from financial institutions and make part-payment of ICDs. In the last two years, Mangalam Cement has been reporting losses and in 1997-98, the losses amounted to Rs28.79 crore, resulting in a negative earning per share of Rs19.30. The OCCPS will be converted into equity shares at par within 36 months, or 48 months or 59 months from the date of allotment. Mangalam Cement located at Kota in Rajasthan has an installed capacity of 1,000,000 tonne per annum. The company's cement is sold under the brand name, Birla Uttam. For 1998-99, Mangalam Cement has projected a net profit of Rs2.36 crore. (gsh)
Comment:
Proposes to float rights issue of 14% optionally convertible cumulative preference shares of Rs10 each for cash at par
Publication Name: Dalal Street Journal
Subject: Business, international
ISSN:
Year: 1998
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GRASIM INDUSTRIES
Article Abstract:
Grasim Industries, the flagship of the Aditya Birla Group, has interests in cement, viscose staple fibre (VSF) and sponge iron. Grasim is currently implementing a restructuring programme. It has acquired the cement division of Indian Rayons, which makes it the third largest player in the cement industry with a capacity of 10.6 million tonnes. The company is the world's largest producer of VSF and holds 80 percent marketshare. The division's capacity was expanded in 1997-98. It acquired a pulp plant in Canada which will produce 110,000 tonnes per annum (tpa) of SW & HW dissolving grade pulp. For the first half of 1998-99 Grasim recorded sales of Rs1761.48 crore and posted a net profit of Rs86.95 crore. (uh) (khr)
Publication Name: Dalal Street Journal
Subject: Business, international
ISSN:
Year: 1999
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