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Project Report Submitted to Alliance Business School in Partial Fulfillment of the Requirements of the Post Graduate Program in Business Management course.
Submitted by GROUP – 4
Under the Guidance of Dr. GERVASIO S. F. L. MENDES and Dr. R. VENKATAMUNI REDDY
We hereby declare that the dissertation work titled “ANALYSIS OF THE INDIAN CEMENT INDUSTRY”, is a record of independent study carried out by us under the guidance of Dr. Gervasio Mendes and Dr. R. Venkatamuni Reddy, Faculty, Alliance Business School, Bangalore. This dissertation has not formed the basis for the award previously of any Degree/ Diploma or any other similar titles of any university.
Date: 23.02.2009 BANGALORE
MEMBERS GROUP – 4 PGP – I ALLIANCE BUSINESS SCHOOL
We would like to express our profound gratitude and grateful thanks to Prof. Gervasio Mendes and Prof. R. Venkatamuni Reddy for giving us the opportunity to study this course and undertake this research. We thank them for showing interest in our research and giving us their valuable advice.
GROUP 4 Anjana Ashok, Divya Mohan, Jitesh Nangia, Priya Bhutada, Priyanshu Mishra, Swati Khurana
CONTENTS Chapter Chapter Name No. 9 15 16 II Research Design Statement of Problem Objectives of the Study Scope of the Study Tools and Techniques for Data Collection Limitations of the Study 21 21 21 21 22 III Industry Analysis Structure of the Indian Cement Industry Status of the Indian Cement Industry over the periods SWOT Analysis Porter’s Five Forces model Reasons for the growth of the Cement Industry Indian Cement Industry Demand Drivers – 2008 30 26 28 28 24 25 IV Analysis of Data Major Companies Analysis of Financial Ratios of Major Companies 36 41 4 . I Introduction Global Cement Industry Indian Cement Industry Evolution of the Indian Cement Industry Page No.
Analysis of Key Financial Ratios of Minor Companies Key issues relating to the Cement Industry 48 55 V Summary of Findings The cement industry performance for the year 2008-09 Effects of Recession on the Indian Cement Industry Future prospects of the Cement Industry Bibliography 66 68 62 59 5 .
1.7 1.18 1.15 1.1 1.17 1.12 1.3 TITLE Status of the Indian Cement Industry Home Loan Rates and disbursement of loans Projects under the NHDP Major Companies Page No 25 32 34 1.4 1.8 1.14 1.2 1.16 1.10 Industry Standards (Ratios) – North Region Industry Standards (Ratios) – South Region Analysis for the Year ended 2007-2008 Analysis for the Year ended 2006-2007 Analysis for the year ended 2005-2006 Analysis for the Year ended 2004-2005 Analysis for the Year ended 2003-2004 Minor Companies 41 41 42 43 44 46 47 1.13 1.5 1.6 1.LIST OF TABLES Table No.9 1.11 1.19 Industry Standards (Ratios) – North Region Industry Standards (Ratios) – South Region Analysis for the Year ended 2007-2008 Analysis for the Year ended 2006-2007 Analysis for the Year ended 2005-2006 Analysis for the Year ended 2004-2005 Analysis for the Year ended 2003-2004 Region-wise production of cement Region-wise cement consumption 48 49 49 50 51 53 54 60 61 6 .
11 12 13 25 30 33 60 2.7 TITLE Diagrams showing: Gigatons/yr of cement produced/used Percentage of yearly worldwide cement produced/used Percentage change in cement production/usage Trends in the Cement Industry during Five-Year Plans Indian Cement Industry Demand Drivers .6 2.3 2.5 2.4 2. 2.9 61 65 7 .1 2.8 2.LIST OF GRAPHS AND CHARTS Sl No.2008 Loan Rates and disbursement of loans Region-wise production increase for December 2008 Region-wise consumption and YoY growth percentage Cement prices Page No.2 2.
CHAPTER I INTRODUCTION 8 .
Holcim. This also means that as a rule the number of markets in growth at any one time will exceed those in decline. Holcim from Switzerland. Holcim 9 . has 24 plants in the country and enjoys a market share of about 23–25 per cent. resulting in the growing dominance of the industry by its largest businesses According to the leading manufacturer of cement production equipment in the world. commercial building and infrastructure) and economic growth (driving up the consumption of cement per capita). While much of this growth is set to come from emerging growth markets in Central and Eastern Europe and Asia. meaning that growth prospects for the industry are encouraging. It will further invest about US$ 2. world cement consumption is set to rise on average between 3.GLOBAL CEMENT INDUSTRY Cement is a cyclical industry in which long periods of growth are interspersed by shorter periods of decline.6% and 4.8% per year in the coming years. the Portland Cement Association (the US cement sector’s trade body) is expecting world cement consumption to average more than 6% annually in the next two years. meaning that it is comparatively rare for their periods of decline to coincide. so cement plants need to be close to customers. reaching 2.49 billion in the next five years to set up plants and raise capacity by 25 MT in the country. The key growth drivers for cement consumption are population growth (increasing demand for housing. one of the world's leading suppliers of cement. Over recent decades. Cement is a global industry made up of local markets. different geographical markets have experienced different cycles. FLSmidth. Italy's Italcementi and Germany’s Heidelberg Cements together hold more than a quarter of the total capacity. transportation costs become a key factor in determining its profitability. despite the 2007 downturn in the US. This is a significant factor for the long-term outlook of the cement sector.9 billion metric tons by 2008 (estimation Oct 2007). The recent years have witnessed a surge of foreign direct investment in the cement sector. Rapid urbanization and the booming infrastructure have lead to an increase in construction and development across India. This is why global cement industry leaders are seeking to be present in as many local markets as they can. growth in mature markets also looks healthy. When a product is both heavy and cheap. attracting even the global players. At the same time. International players like France's Lafarge.
will also record aboveaverage cement market gains. The French cement major. which acquired full stake in the K K Birla promoted Zuari Industries' cement. However.7% annually through 2010 Global demand for cement is forecast to grow 4. benefitting from continued growth in construction spending worldwide and further advances in manufacturing technology. Other developing parts of the Asia/Pacific region and Eastern Europe. Global demand to rise 4. with maintenance and repair construction accounting for much of the growth in cement demand through 2010. Italcementi Group. fueled by a robust construction outlook. Market advances will be less robust in the developed areas of the US. which is already by far the largest market for cement in the world. will register the biggest gains in terms of the total amount of cement sold. Turkey and Indonesia will record some of the strongest increases in percentage terms. will be less robust but still healthy. for US$ 126. Thailand. the Ukraine. China. Lafarge which acquired the cement plants of Raymond and Tisco with an installed capacity of 6 MTPA a few years back plans to double its capacity to 12 MT over the next five years by adopting the greenfield expansion route. as well as a number of nations in the Africa/Mideast and Latin America regions.7 percent annually to 2. which currently accounts for more than three-quarters of all cement demand worldwide. Japan and Western Europe. where India contributes US$ 2 billion–2. a pickup a construction spending in Germany and Japan following an extended period of decline will help bolster overall developed world market growth. Vietnam. Sales of straight portland cement. 10 .62 million in 2006 plans to invest US$ 174 million over the next two years in various greenfield and acquisition projects.8 billion metric tons in 2010.has a global sale worth about US$ 20 billion.5 billion.
Fig.1: Gigatons/yr of cement produced/used Source: Industry data 11 . 2.
Consumer demand for cement will also climb at an above-average pace. where large-scale construction projects will require significant amounts of ready-mix concrete through 2010.2: Percentage of yearly worldwide cement produced/used Source: Industry data Ready-mix concrete to be fastest growing end use the ready-mix concrete market is expected to be the fastest growing end-use segment. where consumer sales can account for half 12 . 2. stimulated by rising personal income levels in developing parts of the world.Fig. Ready-mix concrete companies account for a comparatively small but increasing share of total cement demand in a number of fast-growing developing countries. and suppliers will benefit from an extremely favorable market outlook in China.
or more of total cement demand. . 2. and by new product introductions in mature developed world markets.3: Percentage change in cement production/usage Source: Industry data 13 . Fig.
German major Heidelberg Cement has merged Mysore Cement. Increased activity in infrastructure and a booming real estate market have seen foreign firms vying to acquire a share of the pie. Moreover.8 billion.63 per cent stake in Shree Digvijay Cement. it also increased its stake in ACC Cement with US$ 486 million. HSBC. the Portugese cement maker. with the cement sector contributing to 7 per cent to the total deal value. Leading foreign funds like Fidelity. (where it acquired 100 per cent stake in 2008) and its 100 per cent Indian subsidiary. in which it owns around 54 per cent stake. Cimpor.91 million. being the single largest acquirer in the cement sector.5 per cent in India’s thirdlargest cement firm.Mergers and Acquisitions (M&As) A growing and robust economy was noteworthy in terms of the total number of mergers and acquisitions (M&A) in India 2007. for US$ 124.10 million for Grasim Industries’ 53. paid US$ 68. Indorama. ABN Amro. Holcim strengthened its position in India by increasing its holding in Ambuja Cement from 22 per cent to 56 per cent through various open market transactions with an open offer for a total investment of US$ 1. India Cements (ICL). Nomura Asset Management Fund and Emerging Market Fund have together bought around 7. Heidelberg Cement India 14 .
15 . The cement industry in India dates back to 1914. Cement is an essential component of infrastructure development and most important input of construction industry. who used the term "opus caementicium" to describe masonry which resembled concrete and was made from crushed rock with burnt lime as binder.84% as also the rate of growth of capacity addition during the same period. The word "cement" traces to the Romans. with industry capacity of over 200 million tonnes. Also the industry is a significant contributor to the revenue collected by both the central and state governments through excise and sales taxes. which are necessary for the country’s socioeconomic growth and development. Domestic cement demand growth has surpassed the economic growth rate of the country for the past couple of years. It is consented to be a core sector accounting for approximately 1.14 million people. Demand for cement in the country is expected to continue its buoyant ride on the back of robust economic growth and infrastructure development in the country. It is the second largest producer of cement in the world just behind China. It is considered as one of the core infrastructure industries. with the setting up of its first unit in Porbunder.INDIAN CEMENT INDUSTRY Cement is a binder which sets and hardens independently.37 % was higher than the rate of growth of supply at 4. particularly in the government’s infrastructure and housing programs. The growth rate of cement demand over the past five years at 8. The cement industry has continued its growth trajectory over the past seven years. and can bind other materials together.3% of GDP and employing over 0.
This led to a price war between the producers forcing many to sell below its production cost and also many into liquidation. Gujarat with an installed capacity of 10. In 1927.EVOLUTION OF THE INDIAN CEMENT INDUSTRY Until 1982. the government controlled the price and distribution of the cement since the production wasn’t sufficient to meet the entire demand. 16 . The first organized effort on mass scale to manufacture Portland cement commenced in Madras in 1904 by South India Industries Limited. Concrete Association of India was formed whose two main objectives were to educate public about the use of cement and to play an active role in popularizing Indian cement. These events resulted in formation of Indian Cement Manufacturers’ Association in 1925 (the price regulator). The industry was partially decontrolled in 1982 and this gave impetus to its pace of growth.000 tonnes and production of 1000 tonnes. The problem of supply outstripping demand was significant in early period of the industry. Then the government of India intervened into the market and referred the cement industry to the Tariff Board. It was in 1914. that the first commissioned cement-manufacturing unit in India was set up by India Cement Company Limited at Porbandar. HIGHLIGHTS In 1889. The board recommended protection by government and cooperation among existing cement units. Calcutta firm attempted to produce cement from Argillaceous (kankar). but it failed.
aimed at ensuring fair prices to producers and consumers all over the country. Due to maintained slow development. Dalmiya Jain Group set up five factories with installed capacity of 575000 tonnes and ACC added four more plants. the government had to increase the fixed price several times. In 1936. implemented in 1956. CONTROL PERIOD (1969-1982) Direct control by government over production. Growth was low due to inadequate retention price and lack of adequate financial resources to the existing companies. the uniform price imposed by the government was substituted by a three-tier price system in 1979. The price and distribution control system on cement. This was followed by the formation of Cement Marketing Company of India Limited in 1930 to promote and control the sale and distribution of cement at regulated prices. capacity and distribution of cement. In 1937. the sales increased along with the increase in the number of plants. eleven companies. merged to form Associated Cement Company Limited (ACC). 17 . After all these initiatives. except Sone Valley Portland Cement Company Limited. medium and high cost plants. Although due to slow growth in capacity expansion and rising cost in the industry. Different prices were assigned to cement produced in low. Indirect intervention took the form of price control.
Thus, controlled price did not reflect the true economic cost and profit margins reduced increasingly, preventing essential investments in capacity and production expansion.
However, the system resulted in artificial shortages, extensive black marketing and corruption in the civil supply departments of the government.
The system of price control was accompanied by a policy of freight pooling. The price control fixed a uniform price according to estimated production costs at which cement was required to be sold all over the country. This price contained a freight component that was averaged over the country as a whole.
It implied that producers had no incentive in locating production, such that transportation costs of cement would be minimized.
As a result of non-optimal location of industries, average costs of production as well as demand for scarce railway capacity for transportation increased.
PARTIAL DECONTROL (1982-1989) The government of India introduced a system of partial decontrol in 1982. A levy quota of 66.60 % for sales to government and small house builders was imposed on existing units while for new and sick units a lower quota at 50% was established. The balance of 33.40% could be sold in the free open market to general consumers. A ceiling price was set for sales in the open market. Freight pooling no longer covered non-levy cement.
To sustain an accelerating course, the government in 1988 subsequently introduced the levy quota as low as 30% for units established before 1982 and the retention price had increased substantially.
In 1987, the Cement Manufacturers’ Association and the government decided that there was no further necessity for a maximum price ceiling.
TOTAL DECONTROL (1989 onwards) In 1989, all price and distribution controls on sale of cement were withdrawn. Freight pooling was abandoned and a subsidy scheme to ensure availability of cement at reasonable prices in remote and hilly regions of the country was worked out. De-licensing under the policy of economic liberalization was done in 1991. Growth was seen from 91 plants and 43 million tonnes of production in 1989-90 boosting to 132 plants and 161.66 million tonnes production in 2006-07 (CMA 2007). Total capacity utilization for the industry has also increased from 78% to 91% during the same period.
the Indian financial market has witnessed considerable maturity. The top 5 and the bottom 3 performers of the industry have been chosen on the basis of their sales in the previous year. All this has played its part in the growth and development of the cement industry. liberalization of economic policies in India has resulted in a business climate that has favoured rapid growth in almost all segments of Indian industry and commerce. 21 .STATEMENT OF THE PROBLEM During the last few years. The entire process has brought in a lot of changes in various aspects of financial market. LIMITATIONS OF THE STUDY: The study is limited to selection of top 5 and bottom 3 cement companies in India. METHODOLOGY OF STUDY The whole study can be termed as a desk research. OBJECTIVES OF THE STUDY To analyze the evolution of the cement industry. To compare the financial ratios of the leading and the lagging companies in the industry. During the last few years savings of country was around 23%. company websites. The number of years used for comparing the performance of these companies is 5. Capitaline databases have been the main source of information for company analysis. To find the reasons for the growth of the industry. Hence there is no field work and collection of primary data for this research except for secondary information obtained by the medium of internet. The primary reason for this is the (LPG) process in1991. During the past decades. which was one of the highest in world. journals and magazines. magazines and various articles. SOURCES OF DATA Only secondary data was collected from the internet.
CHAPTER III INDUSTRY ANALYSIS 22 .
cement production is normally at its peak in the month of March while it is at its lowest in the month of August and September. In India. The cyclical nature of this industry has meant that only large players are able to withstand the downturn in demand due to their economies of scale.STRUCTURE OF THE INDIAN CEMENT INDUSTRY It is a fragmented industry. Since cement is a high bulk and low value commodity. One of the other defining features of the Indian cement industry is that the location of limestone reserves in select states has resulted in it’s evolving in the form of clusters. 23 . There are 56 cement companies in India. Another distinguishing characteristic comes from it being cyclical in nature as the market and consumption is closely linked to the economic and climatic cycles. centrally controlled distribution systems and geographical diversification. competition is also localized because the cost of transportation of cement to distant markets often results in the product being uncompetitive in those markets. where majority of the production of cement (94%) in the country is by large plants. operational efficiencies. operating 124 large and 300 mini plants.
Status of the Indian Cement Industry over the periods Fig.1 .4 . 2.Status of the Indian Cement Industry over the periods Table 1.Trends in the Cement Industry during Five-Year Plans 24 .
2% in 2007 and 9. And with increase in government focus on infrastructure spending. However. High Interest rates on housing: The re-pricing of the interest rates in the last four years from 7% to 12% has resulted in the slowdown in residential property market. Low cost of production: due to the easy availability of raw materials and cheap labour. b) Weakness: Effect of global recession on real estate: The real estate prices are stabilizing and facing steady slowdown especially in metros. India is facing tough economic times in 2008. Demand-Supply gap. There has been drastic reduction in property prices due to reduced demand and increased supply. which results in rising demand for better quality of life that further necessitates infrastructure development and hence increases the demand for cement. Increasing cost of production due to increase in coal prices. There are approximately one hundred thousand completed flats without occupancy in Bangalore. Increase in infrastructure projects: Infrastructure accounts for 35% of cement consumption in India.6% in 2006. Growing middle class: There has been increase in the purchasing power of emerging middle-class with rise in salaries and wages. growing 9. the cement demand is likely to grow in future. highways and airports. such as roads. overcapacity: The capacity additions distort the demand-supply equilibrium in the industry thereby affecting profitability. 25 . c) Opportunities: Strong growth of economy in the long run: Indian economy has been one of the stars of global economics in the recent years.SWOT ANALYSIS a) Strengths: Second largest in the world in terms of capacity: In India there are approximately 124 large and 300 mini plants with installed capacity of 200 million tonnes.
173000 Metric tones of cement was exported to India. 26 . The induction of advanced technology has helped the industry immensely to conserve energy and fuel and to save materials substantially and hence reduce the cost of production. d) Threats: Imports from Pakistan affecting markets in Northern India: In 2007. 130000 tonnes in 2008. Excess overcapacity can hurt margins. This was done to keep the price of cement under check. At present ninety three per cent of the total capacity in the industry is based on modern and environment-friendly dry process technology and only seven per cent of the capacity is based on old wet and semi-dry process technology. as well as prices. Technological changes: The Cement industry has made tremendous strides in technological up gradation and assimilation of latest technology.
PORTER’S FIVE FORCES REASONS FOR THE GROWTH OF CEMENT INDUSTRY The domestic cement industry is highly insulated from global cement markets. However. power plants etc). Broadly. it can be categorized into demand for housing construction (homes. making cement duty free. Exports have been constant at about 6% of total cement demand for past few years. roads. cement is being imported from neighbouring countries. With the Government of India intervention.) and infrastructure creation (ports. offices etc. due to logistics issues and lack of port handling capabilities imports of cement will remain negligible and do not pose a threat to domestic industry. Earlier government sector used to consume over 50% of the total cement sold in India but in the last decade. Demand for cement is linked to the economic activity in any country. its share has come down to 35%. The real driver of cement demand is infrastructure development. hence cement demand in emerging economies is much higher than developed countries where the demand has reached a 27 .
Promotion of concrete highways and roads.4% followed by Northern and Eastern regions at 8. and Use of ready-mix concrete in large infrastructure projects. ii.plateau. viz. Apart from meeting the entire domestic demand. accounting for about 30% of total domestic cement consumption. The export of cement during 2001-02 and 2003-04 was 5. iii. In India too. 2003 was 1. with the nation being divided into four regions.9% and 9%. the demand for cement will be affected by spending on infrastructure (including housing. i. 28 .14 million tonnes and 6. KPMG Consultancy Pvt. During FY 03-07. The report submitted by the organization has made several recommendations for making the Indian Cement Industry more competitive in the international market. the industry is also exporting cement and clinker. Export during April-May.35 million tonnes. The Planning Commission for the formulation of X Five Year Plan constituted a 'Working Group on Cement Industry' for the development of cement industry. Ltd. The Working Group has identified following thrust areas for improving demand for cement.5 mn tonnes in FY 07. Southern region has witnessed highest CAGR of cement demand at 10. Further. The Southern region dominated the cement consumption at 44.) Cement is a bulky commodity and cannot be easily transported over long distances making it a regional market place. the Department of Industrial Policy & Promotion commissioned a study on the global competitiveness of the Indian Industry through an organization of international repute. respectively. in order to improve global competitiveness of the Indian Cement Industry. Each region is characterized by its own demand-supply dynamics.92 million tonnes respectively. Further push to housing development programmes.
723 crore in the year ended 2000 to a massive Rs 2. Some of which are: • Tax rebates on housing loans • Continued growth in population • Decrease in number of people per household (average size of household) • Rise in disposable income levels • Lower interest rates and easy availability of housing finance.Indian Cement Industry Demand Drivers .932 crore in the year 2008. These two sectors have been further analysed. HOUSING Housing. besides being a very basic requirement for the urban settlers.2008 (Source CMA) Housing and infrastructure sectors constitute a major part of the total demand for cement in India. Investments in housing. Construction sector employment is growing at the rate of 7% per annum. like any other industry.52. The Indian Housing sector has grown by leaps and bounds in the last few years.2008 Graph 2. have a multiplier effect on income and employment.Indian Cement Industry Demand Drivers .5 . The total home loan disbursements to this sector has risen from Rs 19. Housing provides opportunities for home-based economic activities.This robust growth has been triggered by a number of factors. 29 . also holds the key to accelerate the pace of development.
Himachal Pradesh and the north-east are also seeing a spurt in demand. including Tamil Nadu. While a marked increase in demand is being seen in the rural parts of predominantly underdeveloped states such as Bihar. The cement industry is expecting around 50 per cent of the overall demand to come from the rural housing sector during the current year and beyond. and refinance options are some of the noteworthy schemes that the institutes have come up with to attract the borrowers. expects over six million houses to be built in rural areas over the next four years.Also the Housing Finance Companies and banks have introduced various schemes to attract the young generation borrower. accounting for over 70% of the housing units constructed and the organized sector accounting for the rest. The Centre. followed by a prolonged period of about 8 years of little or no appreciation in real estate. The stock market and real estate markets crashed in quick succession . comprising small builders and contractors. The Centre's latest estimates peg the estimated shortage of houses in rural areas at around 15 million as against an overall shortage of 22 million dwelling units in the rural and urban areas put together. lower rates for purchase of consumer durables. household goods. accentuated by high inflation and high interest rates. The organized sector comprises large builders and government or government affiliated entities. with the unorganized sector. The Indian housing industry is highly fragmented. With increasing rural affluence. not only kept speculative inflows out but also kept genuine home seekers at bay. One of the most important reasons is that the rural people are moving from thatched mud units to pucca (brick and mortar) structures.1994 and 1995 respectively. The crash. However. Chhattisgarh and Uttar Pradesh. These states. especially in the most underdeveloped sates. Rural people. reversal in that trend is being witnessed in the past 3-4 years because of several reasons. are increasingly replacing thatched mud hutments and switching over to pucca structures. The housing market witnessed a frenzied boom in the early nineties on the back of a booming stock market and a liberalization process that was kicked off in 1991. Rural housing projects undertaken by about 15 states through their own capital subsidy or credit-cum-subsidy schemes have also resulted in rural housing coverage going up during the last few years. Free home insurance. Andhra Pradesh. the hill states of Uttarakhand. 30 . under its Bharat Nirman programme. demand for cement for construction of houses in villages has gone up significantly overt the last few years.
79.85 2004 07.00 Source: RBI Trend and Progress Reports Year Quantum of Loan lent in Rs Crore 19.359. Table 1.00 2008 9. Jharkhand.35 2003 09.672.060.15 2002 11.24.276. rising industrial activity.00 1.932. Meghalaya and Punjab.52. and strong real estate demand from commercial and residential sectors.723.50 2007 11.65 2005 07. The demand buoyancy is witnessed across sectors with increased focus on infrastructure development.34.481. The cement industry recorded another year of double digit demand growth (10 per cent for 2006-07). Uttarakhand.Karnataka. which have also greatly contributed to the growth of the housing sector thus fuelling the demand for cement and in turn its production. The following graph gives a clear indication of the rise in the quantum of loans lent as against the rate of interest prevailing over a period of time.425.00 31 . Gujarat.00 1.449.09 29.70 89. Sikkim.29 51.50 2006 08.00 2001 12. have together constructed about 27 lakh houses from 2001 to 2005.38 22.00 2. according to Planning Commission estimates.00 2.2 – Home Loan Rates and disbursement of loans Interest Rate (in %) 2000 13. Another reason is the fall in interest rates.
the progress of infrastructure has been very poor and has been a zigzag process. like Nokia and automotive makers like Volvo. it would be visible that India is turning the corner on the infrastructure question and in turn spurring the demand for cement.6 . Many international companies. Since India began opening up in 1991. 2. the cement demand is likely to go up in the near future. But if one considers the following developments. until recently. particularly on roads. Construction has been taking place – land clearance has been done to relocate squatters or farmers away from their land and this has already happened in the last five years or so. Firstly. ports and airports. are actually producing in the SEZs.Fig. there are over a hundred Special Economic Zones (SEZs) in India either in operation or under construction. 32 . With the government increasing its focus on infrastructure spending.Home Loan Rates and disbursement of loans INFRASTRUCTURE Infrastructure projects along with commercial constructions accounts for about 35% of the total cement consumption in India.
33 . New airports have come up and the efforts are on to modernize the existing ones. There are well over 500 retail malls either already operating in India or in various stages of construction and this is also new in the last three to five years. the government has set aside over USD100 billion for infrastructure spending in between 2007 and 2012. V and VI. six-laning of roads under NHDP Phase I and also 1. A total demand of close to 50 million tonnes of cement is expected from the above projects.000kms of new expressways. The total cost of these new projects is about Rs.075 billion and is expected to be completed by FY2012. Thus. Further. Table 1.3 – Projects under the NHDP Moreover. upgradation of existing highways. III. IV.The other thing to look at is the organized retail sector in India. The various road projects under the National Highway Development Program (NHDP Phase I and II) initiated by the previous government are being successfully implemented by the present government. which include having four lanes on high density highways. 1. government has also announced new projects namely NHDP Phase. infrastructure is getting its share of attention and in turn spurring demand for cement.
CHAPTER IV ANALYSIS OF DATA 34 .
ACC.melding into a cohesive organization in the year 1936 at Maharashtra. The company received an award as 'Good Corporate Citizen' for the year 2005-2006. it is a cornerstone of its corporate objectives. A prominent overseas presence and figuring on the elite list of consumer super brands of India but most importantly ACC has been amongst the first Indian companies to make environmental protection. Companies fall within the categories of: INDIA – MAJOR – NORTH INDIA – MAJOR – SOUTH INDIA – MINOR – NORTH INDIA – MINOR – SOUTH MAJOR COMPANIES The top 5 cement companies have been selected based upon their performance in the last financial year. Shree Cement Southern Region – India Cement ACC LIMITED Established in 1936. Meanwhile the 35 . It’s a big company in cement manufacturing and offers the services of Ready mixed concrete and Consultancy service. This company is listed by Bombay Stock Exchange. During the year 2007 company acquired 100 % of the equity stake of Lucky Minmat Private Limited for Rs 35 crores and also acquired 14. The 5 major companies are – Northern Region . National Stock Exchange and in London. Ultra Tech Cement. The net sales turnover has been used to judge performance. ACC has been a pioneer and trend-setter in cement and concrete technology.The Indian Cement Sector is divided on the basis of regional operations. Ambuja Cement.3 % equity stake in Shiva Cement Limited. The historic merger of ten existing cement companies led to the establishment of ACC .
22 MTPA and New Wadi by 0. 2011. ULTRATECH CEMENT LTD.company divested its entire equity shares in Almatis ACC Ltd to the Almatis group. It manufactures and markets Ordinary Portland Cement.4 MTPA by end of 2010 with total outlay of Rs 4. six grinding units and three terminals — two in India and one in Sri Lanka. The company has major capital expenditure projects in hand.60 MTPA. It also manufactures ready mix concrete (RMC).4 Metric Tonnes Per Annum. The name of the Company was changed to UltraTech CemCo Limited with effect from 19th November 2003. ACC realizes the growth potential of Ready Mix. As a result with this the capacity of Gogal works stands increased to 4. ACC planed to expand the unit of Bargarh works capacity to 2. as “L&T Cement Limited” a 100% Subsidiary of Larsen & Toubro Limited. the company has 26 plants for the same and enhance to 46 in 2008. as a result of these projects the total cement capacity of the company will increase to about 30. for that company made a project for augmentation of clinkering and cement grinding.14 MTPA together with 30MW captive power plant is underway. The company has developed comprehensive expansion plans to meet the requirements of its agenda for growth with a view to attain leadership position in the cement industry.2 million tonnes. UltraTech Cement Limited was incorporated as a public limited company on 24th August 2000. UltraTech Cement Limited has five integrated plants. Portland Blast Furnace Slag Cement and Portland Pozzalana Cement. The implementation of the projects for augmenting grinding capacity at Madukkarai by 0. UltraTech Cement Limited has an annual capacity of 18. ACC commissioned a Wind Energy Farm in Tamil Nadu to promote clean and green technology. 36 . The company foresees substantial scope for growth of this business in India and has accordingly finalized plans to expand Ready Mix business in major cities including Tier1 and Tier 2 cities. The overseas contract with YANBU Cement Company in the kingdom of Saudi Arabia is successfully ongoing relationship from last 28 years and has been renewed up to February 28. The name of the company was again changed to UltraTech Cement Limited with effect from 11th October 2004.000 crores. Ready mix concrete business has been identified as an area of strategic priority.
India Cements Company has a distribution network which is very strong . ICL acquired Coromandel Cement plant at Cuddapah. The India Cements Company has subsidiary companies which include ICL Financial Services. by sea.000 Tonnes. Around 90% of India Cements Company's produce is sold in the Tamil Nadu and Kerala markets. the company's position in the market is sure to rise in the near future.6 million tonnes per annum). It was set up in technical collaboration with Krupp Polysius.UltraTech Cement is the country’s largest exporter of cement clinker. Ranga Reddy district of Andhra Pradesh with Installed capacity 9.000 stockists out of which around 25% is devoted to the company.The cement division of Raasi Cement (RCL) was vested with the company from April. Industrial Chemicals & Monomers. Germany. The Company undertook bulk cement transportation. It also acquired Cement Plant of Visaka Cement Industry. INDIA CEMENTS India Cements was set up in 1946 and the company's first plant was established in 1949 at Sankarnagar. owns famous brands such as Rassi Super Power.00. Africa. The export markets span countries around the Indian Ocean. India Cements Company has a 28% market share and it plans to achieve a market share of around 35% in the near future. The India Cements Ltd. at Tandur. The total production capacity of the plants is around 9 million tons per year. The company got necessary approvals for setting up another cement plant with 1 million tonne capacity per annum at Himachal Pradesh in the year 1991. Bakau Wolf and Fuller KCP. it has risen in stature to become the biggest cement producer in south India. In 1997 India cements acquired Aruna Sugars Finance Ltd which was later renamed as India Cements Capital & Finance Ltd.it has over 10.1998 under a scheme of arrangement India Cements has established itself as a leading cement manufacturing company and as it plans to expand its production capacity. to the major markets of Mumbai. Tamil Nadu. has been established. Surat and other deficit zones on the West Coast. Transportation was to be 37 . India Cements has 7 plants spread across Andhra Pradesh and Tamil Nadu. ICL International. AMBUJA CEMENT The company's cement plant was commissioned in 1985.consequently installed capacity rose to 2. Since the India Cements Ltd. In south India. Sankar Super Power. Europe and the Middle East. and Coromondal Super Power (In the year of 1990. and ICL Securities.
000 retailers across India are covered under this model. Shree's is the largest single location manufacturer with production in Northern India. The company markets its products under two brands. The company has undertaken new activities in the field of leasing and hire purchase during 199495. to incorporate their KIDS system in the clinker cooler to improve efficiency of the clinker cooler and save heat. Best Award for highest exports by CAPEXIL and Economic Times . National Award for outstanding pollution control by the Prime Minister of India.5 million tonne cement project with clinkeriation facility at site in H. Kodinar plant of the company was originated its commercial production with an enhanced capacity. In the last decade the company has grown tenfold.Harvard Business School Association Award for corporate excellence in different years. belonging to the Calcutta-based industrialists P D Bangur and B G Bangur is one of the largest cement producer in Rajasthan was incorporated in the year 1979. The company was awarded for its credit. the company's Muller location 1.P and grinding facility both at Suli & Ropar in Punjab was bespoken.. The company developed a unique homespun channel management model called Channel Excellence Programme (CEP) for marketing their product. the word Gujarat was dropped to reflect the true geographical presence of the company SHREE CEMENT LTD.Shree Ultra Ordinary Portland Cement (OPC) and Shree Ultra Red Oxide Cement.American Express Corporate Awards 2007. Germany.carried out by three specially designed ships during the year 1992. 2007. Germany. Rajasthan with 2. The company name was changed from Gujarat Ambuja Cements Limited to Ambuja Cements Limited on April. Ambuja is the most profitable cement company in India. Shree has two plants in Beawar. and one of the lowest cost producers of cement in the world. It has also tied up with IKN. The company has tied up with Christian Pfeiffer & Company. however. It was the first company in India to introduce the concept of bulk cement movement by the sea transport. During the year 1994. for installing a horizontal impact crusher to pre-crush clinker before using it in the cement mill to upgrade cement output and save energy. Ambuja follows a unique homegrown philosophy for successful survival. the National Award for commitment to quality by the Prime Minister of India. is its approach to the business. The company has been awarded by KPMG 38 . Shree Cement Ltd. Over 7000 dealerships and 20. The company was adjudged as the top Indian company in the cement sector for the Dun and Bradstreet .6 million tonne installed capacity. In 1997. The company's most distinctive attribute.
The total capacity of its Captive Thermal Power Plant has gone up from 36 MW to 42 MW.'97.24 million tonne capacity and has already attained 100% capacity utilization. about 32 kms away from the existing location. The company has successfully commissioned its new cement plant of 1. In Oct.Quality Registrar. This plant is designed to produce a premium grade of cement 'Bangur Cement'. During August 2005 the company has commissioned a 6 MW Captive Thermal Power Plant at its cement manufacturing facility Rajasthan. The additional capacity would enable Company to meet requirement of power for its upcoming 'Bangur Cement Project'. The estimated project cost was Rs. During 2004-05 the company was in the process of setting up a new plant with a capacity of 1.304 crores. 2002. the Raj Cement was commenced production.2 MTPA which is scheduled to start functioning by the third quarter of this year at Village Ras. An EPC contract was signed with Thermax Ltd in September. USA certificate of ISO 9002 during the year. During 2001-02 the company exerise to commission a captive 36 MW thermal power project at a cost of Rs. 39 . 2001 and the civil work commenced in October 2001 and the project is expected to be commissioned by December.2001. The company's modernization and expansion plan to increase its installed capacity from 20 to 26 lakhs TPA was implemented in December 10..120 crores.
73 7.88 1.28 1.82 4.1 11.14 40 .24 7.24 7.72 Table 1.56 5.31 1.27 30.07 2006 2.1 2.73 7.73 6.45 23.56 N/A N/A 0.61 1.61 7.9 9.06 10.63 10.85 2006 0.4 – Industry Standards (Ratios) – North Region YRC Debt-Equity Ratio Current Ratio Turnover Ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBIDTM (%) ROCE (%) RONW (%) Source: Capitaline South Region: 1.06 1.38 0.88 1.27 0.6 0.84 10.59 14.14 1.85 7.5 0.INDUSTRY STANDARDS North Region: Table 1.13 0.08 2004 2.37 0.02 1.23 Latest 1.03 36.81 0.95 2005 1.17 31.54 24.79 2004 3.Industry Standards (Ratios) – South Region YRC Debt-Equity Ratio Current Ratio Turnover Ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) Source: Capitaline 0.08 13.94 29.57 6.16 27.25 11.08 2003 3.5 .08 13.89 10.78 1.92 0.07 2005 2.65 2.82 7.61 3.59 24.36 10.21 15.07 11.27 N/A N/A Latest 1.72 9.49 14.29 23.98 0.71 7.9 10.31 1.64 13.18 13.53 0.87 14.12 9.41 24.
However the working capital position of ACC and Ultra Tech has not been encouraging.02 1.15 1.42 20.97 Ultra Tech March 0.19 ACC December 0.08 36.45 24.Analysis for the Year ended 2007-2008 YRC Debt-Equity Ratio Current Ratio Turnover Ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBIDTM (%) ROCE (%) RONW (%) 1.Table 1.02.3 42. The interest coverage ratio has been the best for Ambuja .91 28.58 31.6 .01 2.01 1.74 41.28 26.87 12.19 0.51 8.01 11. When compared to all the companies.44 8.19 24. The debtor turnover ratio of Shree Cement and Ambuja Cement has been very impressive.29 14. Considering the scenario it can be said that a lower debt would be favourable for the company as it would be relieved of the interest burden.12 1.96 1.88 Ambuja Cement December 0.02 Source: Capitaline Ambuja cement maintained the least debt to equity ratio in this period which was also below that of the industry standard.18 1.67 64. Thus we can say that the company was more dependent on its equity.06 54. This clearly indicates that they are able to generate cash quickly and are able to use this to meet their current liabilities quickly thus maintaining a healthy current ratio.95 40. However Shree cement has the highest ratio.53 11.8 46. For Shree Cement as the interest on the loans taken was high resulted in a lower interest coverage ratio.29 12.69 45.49 29. This measure is an important one for the long term creditors. Shree Cement has the best current ratio of 2. 41 .But Shree Cement and India Cement have scored the lowest on this parameter. This is because the company has increased its secured and unsecured loans by 42% and used the amount to purchase fixed assets and has increased its investments significantly.14 34.32 13.84 24.36 32.69 30. Thus the company has had an efficient working capital position .65 India Cements March 0.05 31.05 Shree Cement March 2.34 35.74 0.91 26.
1 36. The main reason being that during this period it had a high interest payable.83 37.43 4.51 34.5 41.96 55.91 Shree Cement March 1.39 43.7 .26 32.59 1.89 68.4 0.74 1.43 26. Thus owing to a good debtor turnover ratio the company was able to maintain a cash and bank balance of Rs.Analysis for the Year ended 2006-2007 YRC Debt-Equity Ratio Current Ratio Turnover Ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBIDTM (%) ROCE (%) RONW (%) 1. India cement had the best current ratio which was well above the industry standard of 1.45 14.07.24 20.29 10. India Cement was able to maintain its ratio just above the industry standard of 2.92 17.56 Source: Capitaline We note that all the companies with the exception of Shree Cement have a high debt equity ratio in the fiscal 2006-07 when compared to 2007-08.55 2.17 13.3 41.84 1 11.37 10. as is evident form the high debt equity ratio maintained by the company in this fiscal.28 28.08 0.97 42.99 72.51 21. The interest cover ratio has been healthy for all the companies except for India Cement.Table 1.36 1. This depicts that the company is able to generate cash very quickly. The debtor turnover ratio of Shree Cement has been significantly high in comparison to the other players.7 India Cements March 1.29.49 30. The fixed assets and inventory turnover ratio have been satisfactory for all the companies and have been well over their industry standards.22 27.1. 42 .13 12.483 crores in the year ended March 08.9 17. While the other players have maintained a ratio much above the industry standard of 6.13 11.86 ACC December 0.53 31. followed by Shree Cement.57 1.1 35.35 0.97 Ultra Tech March 1.8 14. Ambuja Cement has the lowest debt to equity ratio in this fiscal too.608 crores when compared to Rs.2 Ambuja Cement December 0.
14 8.87 8.Table 1.3 Shree Cement March 1.06 2.12.55 22.06.63 1. i. India cement‘s debt equity ratio is the highest among the top performers which also shows that they have more funds generated from the loans and debts than from the shareholders equity.92 24.2005 to Rs.14 0.28 Source: Capitaline The debt equity ratio of the Ambuja cement is least as compared with the other prominent players which is also below the industrial standard of 0.17 13.2178.82 10. It also shows that there is also a vital role of short term debts in raising funds (as comparing it with the long term debt equity ratio of the others).81 8.72 crores as on 31.86 18.84 Ambuja Cement December 2.72 0.57 0. they might have to pay the additional interest out of the debts.1 YRC Debt-Equity Ratio Current Ratio Turnover ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) ACC December 0.56 19.2006*.27 14.22 which is even much higher than the industrial standard of 0. still it sounds more riskier because of higher interest rates. this may result in the volatile earnings as the result of the additional interest expenses.67 7.57 6.26 27. Thus .42 crores in 30.94 0.19 26.44 20.8 .8 4.49 30.34 17.08 Ultra Tech March 0.96 55.67 25.91 1. Also Ambuja stood to be the lowest in the long term debt-equity ratio because of more increase in the raising of funds from shareholders equity than of the long term loans.98 which depicts that the major funds is generated out of the shareholders equity by increasing it from Rs. 43 .Analysis for the Year ended 2004-2005 India Cements March 1.08 0.3491.9 6.59 68.19 4.e.81 1.22 23.20. However the debt equity ratio of the same has got reduced from the previous of 4.7 1. In the long term debt equity ratio of the India cement stood to be the highest among all the other top performers.88 39.8 0. 2.97 42.89.08 22.76 8.63 0.
the company has enough earnings to clear its interest obligations and thus shows the investment of the lenders are relying in the safe hands.0) which shows the higher liquidity of the company than its peers which is followed by the Shree cement and the acc ltd. And the Ultratech have been efficiently utilizing their fixed assets for the generation of the sales as compared to the others and also succeed their industrial standard of 1. also the coverage ratio of Ambuja cement sounds impressive . 44 . The debtors turnover ratio of the Ambuja cement is very impressive as compared to the others which depicts its ability to collect the amount from the debtors and also the efficient management of the debtors and helps the firm to generate enough cash to meet the current liabilities and thus maintain healthy liquid ratio.8 (near to the ideal ratio of 2.25. however the fixed asset efficiency of the others are the moderate.however the coverage ratio of Ultratech cement and Shree cement is not attractive for the investor as it falls below the industrial standard of 9. The interest coverage ratio observation of the top performers reveals that the coverage ratio of the acc ltd is the highest of all which sounds good from the lenders point of view since its profit before interest and tax is 20.89 and the interest coverage ratio of the Indian cement sounds questionable as it is the lowest of all and also is below its industrial standard of 2.e. As per the comparison of the top cement players the India cement stood to be the highest in maintaining the current ratio of 1. The least one is of the Ambuja cement i.22 times of its interest expenses i.65.63 which is not very attractive . However the debtors collection of the Indian cement is to be questioned as it holds the lowest of the debtors turnover ratio within the top performers and even fall below the industrial standard of 13.07.e. Also it depicts a good short term financial health of the business. The comparison of the fixed asset turnover ratio of the top performers shows that the acc ltd. (however they are far behind the India cement). of 0.
68 7.65 0.34 6.3 0.76.63 Shree Cement March 1. Ultratech Cement has the highest inventory turnover ratio among the Northern major players whereas the lowest is that of ACC cement because the average inventory increased by roughly 43.91 18.4 2.77 0.14 0.47 Ambuja Cement December 0.79 -12.152. ACC cements has prepared its books of accounts in the month of March 2005.18 2. It changed their financial year to December by preparing their Annual Report for a period of 9 months in Decmember 2005. which reduced by Rs.98 Source: Capitaline * In the year 2004-05.71 12. Ambuja cement and ACC Cement have the lowest debt-equity ratios.17 18.5 0.55 0. The ratio for India Cement is lowest because the company has not spent its revenue.59 68.79 11.9 Ultra Tech March 1.61 11.Analysis for the Year ended 2004-2005 YRC Debt-Equity Ratio Current Ratio Turnover Ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) 1.48 0. The current ratio is the least for Ambuja Cement and Ultratech Cement. which increased by Rs.2 0.46 25.55 22.07 17.89 9.86 24. The working capital of India Cement shows a good position.25 8. The fixed asset ratio of ACC cement is high because the revenues increased by 16.9 .33.65 20.57 0.34 2.46 7.Table 1.01 26. it prepared its books of accounts in December.22 crores.69 2. on fixed assets. which has to be strengthened. India cement has the highest debt-equity ratio of 4.82 10.76 1.84 10.66 India Cements March 4.49 crores. Thereafter.94 2.5% that year.7% that year whereas the fixed assets increased by less than 6%. 45 .27 0.35 5. which show a poor working capital.75 ACC March* 1 0.15 9. This is because the fall in equity is more than the fall in debt.
7% in 2004 when compared with 2003.18 2.89 9.83 0.61 1.14 30. The company has reduced its secured and unsecured loans by 31.62 51.6% in 2003-2004 when compared to the previous year. As a result of this.63 14.05 10.95 0.76 0.10 .26 9. which is well above the industry standard. which is also well below the industry standard of 3.32 5.51 ACC March Debt-Equity Ratio Current Ratio Turnover Ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) 1. 46 . The loans of the company have increased by 17. They have a good working capital position when compared to the remaining companies.31 which shows that the company is not able to effectively generate cash from its debtors.33 1.52 0. India cement has the highest debt-equity ratio of 4.86 16.43 6.78 Shree Cement March 1. the equity is much more than its debt. Most of this amount has been invested in fixed assets.76 1.75 21.7 9. Ultratech cement has the lowest current ratio and is also the only company among the top 5 to be below the industry standard.36 21.74 10.88.14 0. The debtors Turnover ratio for India Cement is lower than the industry standard of 13.34 3.99 18. The interest coverage ratio is very low for India Cement Table 1. ACC cement and Shree Cement should work on improving their debtors turnover ratio.17 7.51 0.5 Source: Capitaline Ambuja Cement has the least debt-equity ratio.34 N/A N/A Ambuja Cement December 0. The Debtors turnover ratio is highest for Ambuja cement which shows that it can generate cash from their debtors quickly.47 0.03 19.68 7.21 0.2 India Cements March 4. Ambuja Cement shows a good turnover rate.43 1.09 10. The highest current ratio is that of Shree cement and India cements.53.55 10.1 12. The company is highly dependant on its debt.92 4.Analysis for the Year ended 2003-2004 Ultra Tech March 1.76 which is much higher than the industry standard of 2.41 13.48 1.26 24.
11 0.82 1.39 0.86 7.22 22.54 10.74 1.12 0.56 5. Bheema Cements Table 1. The 3 minor companies are: Northern Region – Sainik Finance Southern Region – Shri Keshav Cements.23 1.99 13. The reason for Ambuja Cement to have the least Inventory Turnover ratio among the major companies of the North is because of its high average inventory.83 6.63 1.52 5. This is because the company’s interest was very high at around Rs.7 10.81 3.83 7.18 1.13 2003 1.26 0.02 1.31 1.36 8.55 2004 2. Ambuja Cement has the highest interest coverage ratio.36 13. MINOR PLAYERS RATIO ANALYSIS The bottom 3 cement companies have been selected based upon their performance in the last financial year.96 8.44 5.87 9. The average inventory of Ultratech cement was quite low during the year.35 Source: Capitaline 47 .88 crores. India cement has an interest coverage ratio which is below the industry standard of 0.106. causing it to have the highest Inventory Turnover ratio among the other players.59 8.73. Its interest was relatively lower than that of the previous years.22 0.84 5. The net sales turnover has been used to judge performance.38 14.54 12.16 7.91 2006 1.87 8.1 1.4 2005 2.89 1.5 11. The Asset turnover ratio is high for ACC cement because the revenue has increased considerably.13 10.52 4.63 7. In the North.91 7. Ultratech cement has the lowest interest coverage ratio.11 – Industry Standards (Ratios) – North Region YRC Debt-Equity Ratio Current Ratio Turnover ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) Latest 1. whereas the value of fixed assets has not increased much.
09 9.61 2004 2.93 4.65 4.94 0.87 8.38 Sainik Finance March 0.45 0.8 0.98 7.89 6.24 0.46 1.7 0.28 8.25 2.06 4. Perhaps the company intends to increase their production capacity.12 – Industry Standards (Ratios) – South Region YRC Debt-Equity Ratio Current Ratio Turnover ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) Latest 2.62 27.66 10.71 5.Table 1.2 18.77 17.13 6.32 0.05 9.21 9.92 6. The excess loan was utilised to purchase fixed assets.33 0 0 2003 2.72 6.71 0.73 crores which is much higher when compared to their last fiscal year which stood at a mere Rs 3.9 15.83 0.76 8.95 1.35 2.83 1.13 -Analysis for the Year ended 2007-2008 YRC Debt-Equity Ratio Current Ratio Turnover Ratios: Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) 1. their total debt stood at Rs 28.25 0.63 8.08 7.16 Source: Capitaline The debt to equity ratio was the highest for Shri keshav.42 1.53 11.19 2.55 0.6 0.49 12. The main reason being that for the year ended March 2008.5 6.03 Shri Keshav March 2.4 3.13 5.92 0 0 Source: Capitaline Table 1.97 1.56 8.07 14. 48 .42 19.17 -0.22 4.93 Bheema Cements March 0.95 6.93 crores.03 0.23 9.23 2.77 11.81 0.1 2005 1.36 2006 1.85 0.31 630.
However only Sainik Finance was able to meet the standard. This is mainly because it had Rs 5.39 crores tied up in inventories. Sainik Finance had the lowest ratio. Sainik Finance and Bheema Cement maintained a healthy current ratio well above the industry which stands at 0.This implies that the company has been very efficient in collecting dues from its debtors where as Sainik Finance had the lowest ratio even below that of the industry standard of 10.97. 49 .Where as Bheema and Shree Keshav have assets of 117 crores and 17 crore respectively and have generated net sales of Rs37 crores and Rs 17 crores respectively.26.23 times. The main reason being that it has very low assets which are worth Rs 6. The low industry standard depicts that the minor players in the South pay less attention to liquidity in comparison to their counterparts in the North where the industry standard stands at 1. Shree Keshav maintained a very impressive debtor turnover ratio for the year ended 2008.23. The companies had a low inventory turnover ratio. The industry standard for fixed asset turnover ratio is 1.05.66 crores . The interest coverage ratio for all the companies lies well above their industry standard. even below that of the industry standard of 9.
46 1.3 times.77 5.29 2.86 2. However it ought to be more from the point of view of the long term lenders. The companies have had interest coverage position better than the industry standard. Thus they have been able to covert their debts to cash very quickly.Table 1.14 .46.32 4.67 6.21 51. However Shree Keshav failed to even meet the industry standard of South India of 0.54 23. The main reason was that the company had a share holder’s equity of only Rs.29 0.77 31.86 and also lagged behind in the fixed asset turn over ratio.82 crores in the year ended 2008.87 4.152. 22. This can help the company to maintain liquidity. More over Sainik Finance had the lowest debt equity ratio. The three companies lie much below the industry standards of 9.26 1.16 1. The current ratio of Sainik Finance was very impressive when compared to its industry standard of 1.35 112.26 times. 50 .Analysis for the Year ended 2006-2007 YRC Sainik Finance March Shri Keshav March Bheema Cements September Debt-Equity Ratio Current Ratio Turnover Ratios: 0.15 1.93 6.54 0. very The debtor turnover ratio maintained by Shri Keshav has been very efficient.9 15.24 12.81 21.88 crores as on September 2007 but the same swelled to Rs. companies have had low inventory turnover ratios indicating that they have not been able to convert their inventory into sales efficiently.5 5.67 4. The companies in this year too. However the other players have not been able to maintain the same and have in fact performed below the industry standard of 9 times.45 1.72 9.54 Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) Source: Capitaline The debt-equity ratio was the highest for Bheema Cement in this year but in the year ended 2008 it was 0.85 0.63 8.
72 1.e.45.21 4. it sounds good as comparing to its industrial standards.Table 1.46 5.55.39 and 0.85 21. The current ratio of Sainik finance and industries seems to be most impressive i.Analysis for the Year ended 2005-2006 YRC Sainik Finance March Shri Keshav March Bheema Cements March Debt-Equity Ratio Current Ratio Turnover Ratios: 0.10 in 2006.2 crores.03 1. stood the highest among the remaining lowest minor performers as its major funds got raised from debts which raised from Rs.58 in mar 2005 to 0.96 3.25 0.12 Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) Source: Capitaline The observation of the debt-equity ratio reveals that the ratio of Bheema cements Ltd. 6.32 0. 2. 8. The debt-equity ratio of Shri Keshav cement and infra ltd.11 2.3 5.15 .49 crores in 2005 to Rs.49 crores to Rs. Is the highest among the minor performers which depicts that it has been efficiently utilizing its fixed assets for generating 51 .13 3.76 12.45 1.83 respectively.9.93 2. however it remained lower than its industrial standard of 1.40 followed by Bheema cements which is at 1.4 1. this might have provided confidence to the investor to invest in the industry.36 2.73 8. This shows that they have greater ability to pay their short-term liabilities (from which they have raised their vital funding requirements. Although the current ratio of Shree Keshav is the lowest of all.89 0. both much higher than their industrial standards of 1. The fixed assets turnover ratio of Bheema cements ltd.01 14.08 1.98 7.36 in mar 2006 primarily because of decrease in debts from Rs.71 6.7 1.32 although there is increase in its ratio comparing to its previous year’s. Also while observing its long term debt-equity ratio it reveals that much of the funding of the companies has been raised from the short term loans and in fact in company such as Sainik finance and industries there has actually being repayment of long term debt. Stood to be the lowest at 0.) thus. The debt-equity ratio of Sainik finance and industries got down from 0.12.
sales as compared to others. The analysis of the debtor turnover ratio shows that the ratio of Shree Keshav cements and infra stands the highest and is far above the ratio of the others .This depicts that the ability to extend credit and to collect debts is higher in Shree Keshav cement as compared to the others. The observation of interest cover ratio reveals that the ratio of the Sainik finance and industries holds the highest of all followed by Shree Keshav cement & infra Ltd. However the same turnover ratio of Shree Keshav is not very encouraging.85 times of its earnings before interest and tax (in case of Sainik finance) which says that the confidence of the creditors would be higher in it. and Bheema cements Ltd.85 and 11. However all of the three minor players have their interest cover ratio higher or equal to their industrial standards. 52 . The fixed assets turnover ratio of Sainik also sounds good as comparing its previous year’s performance.35 respectively. This shows that the ability to pay interest on outstanding debts is 3. The debtor’s turnover ratio of the other to minor players is not impressive as they fall much below the industrial standards of 11.
94 4.47 5.26 1. The turnover ratio of the other two player is also not very encouraging.05 0.21 Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) Source: Capitaline The analysis of the debtors –equity ratio reveals that Bheema cements has the highest ratio as compared to the others though it has got decreased from its previous year’s ratio.22 0.53 1. The fixed assets turnover ratio observation reveals that the turnover ratio of Bheema cements is the highest amongst all the three minor players and it is also higher than the industrial standard of 0.83 0.Table 1.91 6. This shows that the company is able to efficiently utilize its fixed assets to generate sales.95.94 0.58 2.08 4.16 -Analysis for the Year ended 2004-2005 YRC Sainik Finance March Shri Keshav March Bheema Cements March Debt-Equity Ratio Current Ratio Turnover Ratios: 0. The current ratio of Sainik finance and industries sounds very impressive as compared to the others thus shows its greater ability to pay its short term liabilities.42 8.85 23. Also comparing the debt equity ratio with the long term debt equity ratio reveals that there is presence of short term debts as compared to the long term ones.77 6.94. however it is not sound as compared to the industrial standard of 11.98.49 4. It is even having ratio lower than its industrial standard of 1. The current ratio of Bheema cements also sounds good as it is higher than its industrial standards of 0. 53 .13 1.98 6.1 1. The fixed assets turnover ratio of Sainik and Shree Keshav is not very encouraging.11 1. The debtors’ turnover ratio observation reveals that the ability to extend credit and to collect debt is highest in Shree Keshav as compared to the others.81.38 1.63 0. Others such as Sainik and Shree Keshav cement’s debt-equity ratio is not encouraging.8 6.73 12.
They are able to generate cash quickly.3 1.74 3.68 Fixed Assets Inventory Debtors Interest Cover Ratio PBITM (%) ROCE (%) RONW (%) Source: Capitaline For this period Sainik cements portrayed the lowest debt equity ratio of 0.61.17 . The debtors turnover ratio the highest for sainik cements.87 0. Bheema cements have reduced the external borrowings. Even though the two minor south players are less in comparison to Sainik 54 .1. The interest coverage ratio has been the best for sainik cements followed by Shri Keshav and Bheema.83 1.04 0. Sainik cements has the highest current ratio of 1.85 0.71 0.67 11.88 3.84 1.87 1. it is very less. when compared to the industry standards of 2.37 5. Even though compared to the other minor players Bheema has a higher debt equity ratio.02 2. The interest cover ratio of each of the minor player sounds good as comparing their ratios with the industrial standard with Shree Keshav cement holding the highest of ability to cover its interest obligations with the earnings before interest and tax and thus having greater investor’s confidence followed by Sainik finance and then by Bheema cements Table 1.61 0.63 4.24.04.86 1.Analysis for the Year ended 2003-2004 YRC Sainik Finance March Shri Keshav March Bheema Cements March Debt-Equity Ratio Current Ratio Turnover Ratios: 1. even though it has the lowest in comparison to others is in a good position as the industry standard for minor south is 0.85.36 0. Bheema cements should improve their position and Shri Keshav in this regards has not been up to the mark.12 1.97 3.86.06 7. whereas Bheema cement was 1.99 1. Sainik cements is in a good position as the industry standard is 1.39 9.12 and Shri Keshav with1.74 9. followed by Bheema cements 1.they are in a position to meet their short term obligations.4 7.6 6. Sri Keshav .11 1.3.
This measure is an important one for the long term creditors. In addition. while others have reworked their recipes and tried to make their plants more energy-efficient. The manufacturing process involves burning vast amounts of cheap coal to heat kilns to more than 1.cements. Dimitri Papalexopoulos. close to 1.7 tonnes of raw material (including coal) is transported. there is a trade-off between proximity to raw material sources and proximity to markets. It is the key ingredient in concrete. the location of the cement plant becomes crucial. luxury hotels and car parks. a chemical change which frees carbon dioxide as a byproduct. with modest success. so we can't achieve spectacular cuts in emissions. Cement is needed to satisfy basic human needs. 55 . and one that is rapidly emerging as a major obstacle on the world's path to a lowcarbon economy. cement production will always release carbon dioxide. Athens said "No matter what you do. hospitals. While deciding on the plant location.500C." Already. for every tonne of cement produced. so will greenhouse gas emission. their position is good. So as demand for cement grows for schools. so there is a trade-off between development and sustainability. some cement companies have taken steps to reduce their environmental impact. THE KEY ISSUES RELATING TO THE CEMENT INDUSTRY: Carbon Dioxide emissions: The cement industry is responsible for 8% of global carbon emissions. It also relies on the decomposition of limestone. managing director of Titan Cement. outward freight accounts for close to one fifth of the total manufacturing cost. In this scenario. Some burn waste products alongside coal. You can't change the chemistry. It used to determine how easily a company can pay interest on outstanding debt. Transportation costs: Cement being a high bulk and low value commodity. when compared to their standard of 0. and there is no obvious substitute.92.
Rising railway traffic coupled with insufficient investments by the railways for increased wagon supplies and the fact that the cement industry is not an important customer of the Railways (cement cargo accounts for just 7-8% of the total railway freight) have resulted in a shortage of wagon supply to the cement industry. Rail despatches amount for about 33% while roads carry the balance 66%. road or waterways). locating the plant along the limestone deposits is the logical corollary. These clusters are distant from the markets for cement. Thus. In this case. Thus. Given that 1. The share of road over rail has only gone up over the years. Most of the cement plants in India are located in and around the limestone clusters. The second strategy is to locate the plant close to the mineral deposits.The plant has to address issues of logistics (evacuation of cement by rail.5 tonnes of limestone are required per tonne of clinker. which is not merely to minimize unitmanufacturing cost. and the first strategy is to locate manufacturing facilities near the consuming centers. The balance 1% is accounted by sea transportation. For coal transportation.4-1. outward freight is minimized and marketing flexibility enhanced at the cost of higher raw material assembly costs. cement companies have to rely on extensive transportation for moving coal from the coal pitheads to the cement plants and for dispatching cement from the plant to the markets. 56 . This has resulted in very low volumes of international trade in cement. there can be two broad locational strategies. As both coal and cement are of low value and are bulky in nature. freight costs are considerably higher for cement plants. World cement trade has averaged just around 6-7% of the total production. Cement companies use both road and rail to transport cement and to receive coal. but to minimize unit delivered cost as well. cement companies have started preferring road transportation even for longer distances because of several reasons. so as to minimize raw material assembly costs. power availability in the region. The freight cost becomes a significant factor in determining the landed cost of cement. the dependence on rail network is still very high and accounts for around 70% of coal movement Although rail transportation is more economical for distances beyond 250-300 km.
It sources its raw material by mining. silica. Coal is used as an energy source in cement production. This has forced cement firms to buy local coal from the open market at a 30-60 per cent premium. Coal. As a result. 57 . Large amounts of energy are required to produce cement. Other Environmental Impacts: The cement industry does not fulfil the requirements of environmentally sustainable industry because of the following reasons: It uses non-renewable raw materials and energy. It produces products that are not recyclable such as mercury. the supply situation would continue to remain tight for the rest of the financial years. accounting for almost 35-40 per cent of cost of production of cement. iron oxide and alumina. often fuelled by coal. A high-temperature kiln. mining and material transportation. transforming them chemically and physically into a substance known as clinker. Clinker is mixed with gypsum and ground to a fine powder to make cement. According to a report in economic times in 2007. it is expected that there would be upswing in cement prices as tightness continues. heats the raw materials to a partial melt at 1450°C.Coal prices: Cement is made from a mixture of calcium carbonate (generally in the form of limestone). approximately 70% of cement plants have communities residing near their mines within 1 km radius. is in short supply. a major raw material for cement production is extracted via blasting. And 90% of the limestone. cadmium. such as coal. Kilns usually burn coal in the form of powder and consume around 450g of coal for about 900g of cement produced. Mining also results in depletion of groundwater levels. This grey pebble-like material is comprised of special compounds that give cement its binding properties.noise. In India. arsenic and cobalt. There are also complaints related to building damage and dust problems due to blasting. which destroys the local ecology. the local communities face the following problems: Blasting has high environmental impact. As a result. vibration and dust.
CHAPTER V SUMMARY OF FINDINGS 58 .
25 million tonne in December 2008.9% in the quarter ended June 2008 to 6. the sector has recorded double digit growth for two months in succession. after seven months of single digit growth in the dispatches in the current fiscal. the pace of growth in production accelerated from 6% in October 2008 to 8% in November 2008. However the fall in input prices like the prices of coal and other raw materials from their peaks during the recent past would help the industry in maintaining their margins at least till the end of the next financial year when the supply is expected to exceed demand. The cement sector recorded 11% growth in dispatches in November to 15. In fact. In the process. The central region of the country achieved the highest capacity utilization rate of 98% The northern region and the eastern region had a capacity utilization rate of 93% respectively. which squeezed the operating margins of the cement manufacturers. PRODUCTION & DISPATCHES (REGION-WISE): During the month of December 2008 the cement industry posted excellent growth in production mainly from the northern and the eastern region of the country. 59 . Throughout the financial year 2007-2008 and the beginning of the current year the cement producers were constrained with their inability to raise price due to excessive government intervention. The period then witnessed sky rocketing commodity prices. The demand continued to be strong as can be evident from the capacity utilization levels in all the major regions. The western region and the southern region had a capacity utilization level of 95% and 86% respectively.THE CEMENT INDUSTRY PERFORMANCE FOR THE YEAR 2008-09 India's cement dispatches growth has been improving from 5. which has further accelerated to 8. after similar 11% increase to 14.3% in the quarter ended December 2008 while the industry has shown a 11% YoY growth. Increase in installed capacities by some players also contributed to improved production growth.62 million tonne in December 2008. which has further leaped to 11% increase to 15.3% in the quarter ended September 2008.81 million.
51 2. 2.32 Source: Capitaline 60 .The overall cement production and dispatches increased by 11% to 15. Excess dispatch implies that there is strong demand as inventories are being disposed off quickly.31 3. The production and dispatches were higher by 10% and 11% respectively as compared to the previous month.94 2.7 Increase % 13 22 9 2 9 Production in million tonnes 2.82 million metric tonnes and 15.18: Region-wise production of cement Region Central Northern Southern Western Eastern Fig.81 million metric tonnes respectively during the month of December 2008 as compared to the same period last year.74 4. The following graph gives a clear indication of the increase in production (Region wise) in December in comparison to the previous month. Table 1.
CONSUMPTION: Southern region continued its trend of higher consumption with the total consumption reaching a level of 4.59 and 1.7 Consumption YoY growth % 2.02 25 11. Andhra Pradesh and Tamil Nadu were the dominant consumers in the southern region accounting for 1.38 3.21 4.3 Source: PL Research 61 .02 million tonnes.1 8.7 9.3 million tonnes respectively. Table 1.46 3.58 2. 2.58 million tonnes thus registering a YoY growth rate of 9. Following South is the Western region with a consumption of 3.3 14.19: Region-wise cement consumption Region Central Northern Southern Eastern Western Fig. The following graph gives a clear indication of the region wise consumption and their YoY growth percentage.3%.
After growing by over 10 per cent in the last two years. It has 132 large plants and 365 small plants with a cumulative installed capacity of 204mt at the end of August 2008.5-2% decline in the freight rates for the cement companies. which were 18%. EFFECTS OF RECESSION ON THE INDIAN CEMENT INDUSTRY India's cement industry is the world's second largest after China with an installed capacity of more than 200 million tonnes. The current price is around USD 76 per metric tonnes. cement demand has slowed down to 9 per cent now. The WPI of cement thus also has fallen. Major input cost for the cement sector like the international coal also fell significant from their peak of the current year. The price was even lower compared to the same period last year. depending on their road and rail transport mix. the prices of cement has also fallen in most of the major consuming markets.INPUT COSTS CONTINUE TO FALL: Following the global financial turmoil commodity prices had crashed from their peak level. However it remained at higher levels when compared to the same period last year. This decline stems from A sharp slowdown in real estate Lack of capital investment in infrastructure sectors and A broad economic downturn across the world. The South African export price of coal during the month of November 2008 was US$ 89. the government has reduced the prices of petrol & diesel by Rs 5 and Rs 2 per litre respectively and in the coming weeks the government is planning to reduce the prices further due to falling crude oil prices. In line with the falling commodity prices and the benefits arising from the recent cut in excise duty. During the month of December 2008. Cement.48 during the month of December 2008 as compared to the previous month. 62 . which has a weight of 1.38 / metric tonnes.73% in the WPI index. has fallen by 1% to 222. A cut of 5-6% in diesel prices will translate into a 1. lower compared to the previous month.
East-West corridor project. sanitation. IDFC and IIFCL. It accounted for almost 55% share in FY 07. by 2009. Blackstone.950 crore have been sanctioned in sectors such as water supply. iron and other building material. The slowdown is aided by The fall in stock markets.REAL ESTATE SECTOR: The real estate sector is the key driver of the Indian Cement Industry.The budget announced the launch of the US$5 billion infrastructure financing initiative by partnering with Citigroup. 23. INVESTMENT IN INFRASTRUCTURE: The Union Budget 2007-08 provides for The completion of the North-South. as wealth creation does not happen and there is lack of capital among investors to invest in real estate projects. to adjust their share market losses. (for real estate developers) Income levels have not risen in proportion to the increase in property prices thus forcing many potential buyers out of the market. The unending euphoria of real estate sector in India witnessed during the last few years is finally starting showing signs of ebbing. many investors are forced to sell off their real estate properties. Due to rising input costs of steel. This has imposed constraints on residential as well as commercial demand since IT/ITES segment accounts for 70% of the total commercial demand. under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) Public private partnership (PPP) model . The IT industry is experiencing a slowdown. Also. 63 . road and housing in many cities spread over several states. transport. This slowdown is likely to hurt the cement sector the most. there may be a delay in project completion leading to financial constraints. Other factor that has led to the slowdown is the increase in interest rates leading to higher costs. As a result. 538 projects with a total cost of Rs. it has become unviable for builders to construct properties at agreed prices. Government also proposes to promote the flow of investment to the infrastructure sector by Real Estate Mutual Fund (REMF).
6 percent growth posted in the corresponding year ago period. They also estimate capacity utilization to fall sharply to 74% in 2009-10. petroleum refinery products. CAPACITY UTILISATION: The industry's capacity utilization for second quarter ended September 2008 declined to 82%.7 million tonne in 2008-09 and 47. During the April-July 2008 period. *The core infrastructure sector comprises of crude oil. 120mt of capacity is to be added. The surplus of cement in the industry is predicted to be as high as 20. The production capacity exceeded the demand.68 percent of India's industrial output (IIP). lower than 6. India requires approximately US$320 billion for infrastructure during the eleventh Five Year Plan. cement and finished (carbon) steel. This in turn affects the housing sector.4 million tonne in 2009-10. Such initiatives will create the necessary finance pool for speedy implementation of critical infrastructure projects in the country. OVERALL SLOWDOWN (Economic Downturn): Job cuts and pay cuts are a common phenomenon after the global meltdown and the cost of living has gone up due to inflation. a four-year low. India's core infrastructure sector.3 percent in July 2008 from 7.2 percent a year ago. In the next 2 to 3 years. coal. Experts predict capacity utilization for the year ending March 2009 will be at around 87% down from an optimum level of around 95% in the year-ago quarter ended March. electricity. a borrower faces a serious financial crisis as home loan repayments become difficult. this decline as an immediate impact on its performance. 64 . which accounts for 26.7 percent. largely because 31mt of capacity was added in the past year. However. declined to 4. In such a scenario. As the cement industry is demand driven. in addition to several companies modernizing their plans. the core infrastructure sector grew by 3. thus lowering the total capacity utilization.
said. which accounts for almost 35-40 per cent of the cost of production of cement. Exports have been constant at about 6% of total cement demand for past few years. which is the main export market of Indian cement producers. is in short supply. In 2008. while their net profit declined by 21 per cent on compression of margins. Almost all cement companies faced margin pressures on account of an increase in their overall production costs. Cement exports declined from 10 million tonnes in FY05 to 2. while announcing September quarter results on 18 October.5 per cent and 6 per cent in FY09 and FY10 respectively. "The likely commissioning of around 90mt capacity in a phased manner over the next three years could lead to a surplus scenario by 2009 resulting in pressure on earnings. Graph 2. Demand for cement can be gauged from the country’s economic performance. All these pose a challenge to the cement industry. Coal prices increased by over 100 per cent in the last one year.2 per cent in the mentioned two years. analysts expect demand for cement to grow at 7. with demand typically averaging 1. Assuming that India’s GDP will grow at 6. EXPORTS: Domestic Cement industry is highly insulated from global cement markets. sales realization and margins.1 mt between April-December 2008 on account of additional capacity addition and real estate slump in the Middle East region. This has lead to an overall increase in the cement prices.2 times the GDP growth. last year.8 per cent and 7. Coal. thus affecting the demand for it.UltraTech Cement.8: Cement prices PRODUCTION COSTS: Cement companies reported 10 per cent growth in their revenues. respectively 65 .
FUTURE PROSPECTS OF THE CEMENT INDUSTRY High spending on infrastructure projects and growing demand for housing units will fuel the Indian cement industry.6 million in 2007 to 6 million units by 2011. 66 . COMMONWEATH GAMES: Industry experts forecast that the growth pattern in cement is expected to continue further due to the increased level of construction activities taking place across India. cement dispatches have witnessed impressive growth of 11. which will require 75 million metric tons of cement and power infrastructure that demands around 45 million metric tons of cement. To further boost the housing demand in the country. ports. airports. shopping malls and multiplexes will be the main sectors driving the demand of cement in the country. One of the reasons for this is that Delhi.1% in November and December 2008 respectively. Despite the gloomy outlook for the world economy. many nationalized banks have reduced their interest rates on housing loans. the housing sector is also one of the key drivers for the cement industry and accounts for more than 40% of total cement demand. Besides this. says the report.2% and 12. This plan includes building road infrastructure. railways. Apart from this. This concrete growth in the housing sector will lead to huge cement demand in the country. ESTIMATED PRODUCTION: The current cement industry is expected to grow to produce 223. the number of houses constructed is expected to increase from 3. organized retailing. As a result. INFRASTRUCTURE: The Indian government has considered spending more than US$ 500 billion on infrastructure in the 11th Five Year Plan.30 million tonnes of the 2008. is home to the 2010 Commonwealth Games. urban infrastructure. IT & ITES sector. the capital of India.0 million tonnes in 2009 from 198.
67 . SEZS DEVELOPMENT: Also upcoming SEZs in areas such as Bangalore.ESTIMATED EXPORTS: The target for export has been estimated to be 9. Indore.5% would also act as a benefit for the cement industry as it would boost the overall demand for housing and in turn cement.9 million tonnes and 10 million respectively for 2009 and 2010. Bhubaneshwar. Nasik and Pune would further boost the demand for cement. INCREASE IN POPULATION: Indian population growing at the rate of 1.
BIBLIOGRAPHY 68 .
rbi. www. Review of the Economy 2008/09 National Housing Bank Report 2005 Reserve Bank of India Trends and Progress Reports 69 .in 8.nic.researchandmarkets.capitaline. Performance of Indian cement industry: The competitive landscape.org 6.Sources of On-line Journals and Write ups: 1. www.com 2. www. Anupam Rastogi (2007) .articlenext. www.org.com The following reports were referred to L.com 3. Burange and Shruti Yamini (2008).com 4. G.mospi.com 5.ibef. Economic Advisory Council.in 7. www.economywatch.globusz. www. www. Department of Economics. www. University of Mumbai.The Infrastructure Sector In India.
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