Ambuja Cements to hike prices by Rs20 a bag, expand capacity

Mumbai: Ambuja Cements, the country's third largest cement maker and part of Swiss major Holcim, will raise cement prices by Rs20 per 50 kg bag in two tranches effective October and early January. The hike will take the retail price of cement up to Rs265 per bag.

Gujarat-based Ambuja Cements is also planning to expand in the South Indian market by transporting cement by sea in a bid to lower transportation costs.

The cost of transportation through sea is one-third that of the road  transport. The average freight cost by sea comes to around 50-70 paise per tonne km against Rs1.5 per tonne km for road transportation.

The company has recently taken one more terminal at Mangalore, in addition to Cochin, as it bids to corner a portion of the fastest growing cement market in the country.

Ambuja is also planning to add one more ship to its fleet, taking the total to 11. The company has placed orders for three more ships, which it will receive in two years.

Ambuja claims the hike is due to the spiralling input prices, which has started impacting the company's margins.