UltraTech Cement Announces ₹10,255 Crore Capacity Expansion, Targets 240.8 MTPA by FY28
UltraTech Cement Limited, India’s largest cement producer and part of the Aditya Birla Group, has approved a major capacity expansion plan valued at ₹10,255 crore. The decision was made during the company’s Board of Directors meeting held on October 18, 2025.
Expansion Overview
This latest phase, referred to as Phase IV, involves both brownfield and greenfield projects designed to boost UltraTech’s total cement production capacity by 22.8 million tonnes per annum (MTPA).
UltraTech’s share: 22.2 MTPA
India Cements Limited (ICL) share: 0.6 MTPA
Post-expansion capacity: 240.76 MTPA (from the current 192.26 MTPA of grey cement)
Investment and Funding Details
The company has allocated a total capex of ₹10,255 crore, with ₹10,063 crore for UltraTech and ₹192 crore for ICL. The estimated cost of expansion stands at approximately $52 per tonne.
Funding source: Entirely through internal accruals
Expected IRR: Over 20%
Net Debt/EBITDA Target: Below 1x by FY28
Implementation Timeline
The expanded capacity is expected to be commissioned in a phased manner starting FY28, with full completion targeted by March 2028.
Strategic Rationale
Chairman Kumar Mangalam Birla highlighted that this investment demonstrates deep confidence in the Indian economy and its infrastructure growth trajectory. The expansion is also aligned with India’s long-term vision of Viksit Bharat 2047, supporting national infrastructure and employment generation goals.
UltraTech aims to strengthen its presence in high-demand markets while ensuring sustainable capacity utilization, which currently stands at 71% overall and between 85–95% in regions like North India and Gujarat.
Geographic Focus: Phase IV Expansion
The 22.8 MTPA expansion is strategically focused on Northern and Western India.
| Zone | Cement Capacity (MTPA) | Key Locations | Project Type |
|---|---|---|---|
| North | 18.0 | Vikram, Dhar, Dadri, Jhajjar, Bhatinda, Pali, Banswara (ICL) | Brownfield |
| Sehore, Lalitpur | Greenfield | ||
| West | 4.8 | Kovaya, Wanakbori | Brownfield |
| Total | 22.8 |
In addition, the plan includes a 15.68 MTPA clinker capacity increase, with 8.04 MTPA from brownfield projects and 7.64 MTPA from debottlenecking initiatives across the North, West, and Central zones.
Track Record and Growth Momentum
UltraTech has a strong history of consistent capacity expansion and strategic investments:
Over ₹50,000 crore invested in capacity addition during the past five years.
Added 65+ MTPA through inorganic growth in the last decade.
Ranked as the world’s second-largest cement company by capacity (excluding China) and the largest by sales volume (excluding China).
With this Phase IV expansion, UltraTech Cement continues its long-term growth trajectory, reinforcing its leadership position in the global cement industry and contributing significantly to India’s infrastructure-driven growth story.
