The ₹1500 Crore Makeover: Nuvoco's Vision for Vadraj Cement

Nuvoco Vistas Corporation plans to establish a 2 MTPA grinding unit in Kutch, Gujarat, as part of its strategy to revitalise and operationalise the recently acquired assets of Vadraj Cement. This expansion increases the overall capital expenditure for the refurbishment of facilities in Kutch and Surat from ₹1,200 crore to ₹1,500 crore.

Announced by Managing Director Jayakumar Krishnaswamy during the Q4 earnings call, the investment will follow a phased approach: ₹600 crore each in 2025 and 2026, and ₹300 crore in 2027. The new grinding unit, along with Vadraj’s existing infrastructure, is targeted for commissioning by December 2027.

Vadraj Cement’s assets include a 3.5 MTPA clinker plant in Kutch, a 6 MTPA grinding unit in Surat, high-quality limestone reserves, and a captive jetty in Kutch. With this acquisition, Nuvoco’s total cement production capacity will rise to approximately 31 MTPA.

To fund the ₹1,800 crore acquisition, Nuvoco will secure ₹600 crore through long-term debt, and raise ₹1,200 crore via Compulsorily Convertible Preference Shares (CCPS) and Compulsorily Convertible Debentures (CCDs). A bridge loan of ₹1,200 crore will provide interim financing.

Currently, Nuvoco supplies one million tonnes of cement annually in Gujarat from its Rajasthan plants. The integration of Vadraj’s assets will significantly bolster Nuvoco’s market presence in Gujarat and northern Maharashtra.

News by Rahul Yelligetti.