Orient cement to pay more
The acquisition of the cement assets of Jaiprakash Associates, valued at `1,950 crore, will increase the interest burden of Orient Cement as the deal will be partly funded by debt. The acquisition will, however, help the company's geographical diversification. Orient Cement has presence in the southern and western regions. After the deal is completed, Orient Cement's capacity will increase to 12.1 MT from 8 MT. It will be able to tap demand in central and eastern India, where cement prices and capacity utilisation are firm. At present, the company has concentrated presence in Maharashtra, Karnataka and Telangana, where cement prices and utilisation levels are relatively range-bound.
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