Dangote Cement Plans 80 Million Tonnes Capacity Expansion

Dangote Cement (NGX: DANGCEM) plans to increase its total cement production capacity to 80 million tonnes in the medium term, focusing on low-cost brownfield projects in existing markets. Mr. Arvind Pathak, the Group Managing Director/CEO, revealed this strategy during the Dangote Cement Capital Markets Day presentation in London.

The expansion will add approximately 25 million tonnes to the current capacity, with a strong emphasis on leveraging brownfield expansions due to their lower capital expenditure and faster execution timelines. Pathak indicated that 60% of the new capacity will come from the company's own clinker.

The funding for this expansion will primarily come from internal cash flow, with the company maintaining the option for debt if necessary. Pathak noted that Dangote Cement's leverage is currently very healthy at 0.1 times, allowing for additional funding flexibility.

The company aims to replicate its successful low-cost model from Nigeria across its Pan-African operations.