Capex Update & Green Energy Transition, Cement Sector Outlook take centre stage as ESG BROADCAST shares key takeaways.
India’s largest cement producer UltraTech Cement has unveiled a substantial capital expenditure plan of approximately ₹2,000 crore for its subsidiary India Cements over the next two financial years (FY26–27), aimed at driving operational efficiency, growth and sustainability efforts in its expanded portfolio of assets. This development comes on the heels of UltraTech’s phased acquisition of a controlling stake in India Cements in 2024.
The capex initiative prioritises upgrades to manufacturing infrastructure and energy systems. The roadmap includes converting four and five-stage preheaters to six-stage systems, cooler upgrades, process optimisation to reduce heat consumption, and installation of waste heat recovery systems (WHRS) totalling 21.8 MW. These steps are designed to enhance productivity, reduce emissions intensity and lower operating costs through energy efficiency gains.
A key ESG element in this programme is the accelerated shift towards green power consumption at India Cements. UltraTech management disclosed that the green power share, currently around 5 % in FY25, is expected to rise to nearly 80 % by FY29 through a blend of renewable energy sourcing and WHRS generation. This transition supports the company’s broader climate strategy to curb carbon emissions and aligns with national decarbonisation goals for heavy industry sectors.
Alongside operational and sustainability investments, UltraTech aims to manage balance sheet strength by monetising non-core assets of India Cements to limit incremental debt. This strategic asset rationalisation includes the planned sale of land parcels and the recently divested Indonesian coal mining subsidiary, with targeted proceeds of at least ₹500 cr to support capex financing while maintaining leverage within prudent thresholds.
Beyond the capex focus, India Cements’ production capacity is forecast to expand from 14.75 Mt as of December 2025 to 17.55 Mt by March 2027, underpinning UltraTech’s broader market expansion goals across southern India. This capacity growth is expected to capture rising domestic demand linked to infrastructure projects and residential construction, which are the sectors highlighted in India’s recent national budget as key drivers of economic and industrial activity.
From an ESG perspective, this investment marks a decisive pivot towards energy efficiency and renewable integration in cement manufacturing, a sector traditionally associated with high carbon intensity. UltraTech’s approach integrates sustainability with commercial expansion, setting a precedent for industry peers to embed emissions considerations into capital deployment strategies.
