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CHAPTER – II

CEMENT INDUSTRY IN INDIA

In this chapter an overall view of Indian cement industry and the profile of the

selected cement companies were presented.

2.1 DEMAND FOR CEMENT IN INDIA

The demand for cement depends on industrial activity, real estate and

construction. Since growth is taking place all over the world on these fronts,

Indian export of cement is also increasing.

The cement industry is one of the main beneficiaries of the infrastructure boom.

While several big and small cement companies are actively considering expansion

in anticipation of further growth in demand for cement, a phase of acquisitions and

mergers among the existing players is also not being ruled out in the immediate

future.

The cement industry is experiencing a boom on account of the overall growth of

the Indian economy. The demand for cement, being a derived demand, depends

primarily on the industrial activity, real estate business, construction activity and

investment in the infrastructure sector. India is experiencing growth on all these

fronts and hence the cement market is flourishing like never before.

The Indian cement industry is globally competitive because it has witnessed

healthy trends such as cost control and continuous technology upgradation. Global

rating agency, Fitch Ratings, has commented that cement demand in India is

expected to grow at 10 per cent annually in the medium term buoyed by housing,

infrastructure and corporate capital expenditure.

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Fast rising government expenditure on infrastructure has resulted in a higher

demand of cement in India. In the same direction, participation of larger

companies in the sector has increased. For raising efficiency in the sector, the

Planning Commission of India in the 10th plan has formed a ‘Working Group on

Cement Industry.’

The cement industry was decontrolled from price and distribution on March 1,

1989 and delicenced on July 25,19911. However, the performance of the industry

and prices of cement are monitored regularly. The constraints faced by the

industry are reviewed in the Infrastructure Coordination Committee meetings held

in the Cabinet Secretariat under the Chairmanship of Secretary

TYPES OF CEMENT PRODUCED IN INDIA

These types of cement in India increased over the years with advancement in

research, development and technology. The boom in cement industry has resulted

increase in the production of different kinds of cement in India. A fair estimate,

there are 11 different types of cement are being produced in India. The production

of all these cement varies according to the specifications of the BIS.

Some of the various types of cement produced in India are clinker cement,

ordinary portland cement, portland blast furnace slag cement, portland pozzolana

Cement, rapid hardening portland cement, oil well cement, white cement and

sulphate-resisting portland cement.

1. “Cement pricing” – Economic Times, India, 21st November 2008, Page# 3

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The different types of cement are manufactured using dry, semi-dry and wet

processes. In the production of clinker cement, a lot of energy is required. It is

produced by using materials such as limestone, iron oxides, aluminum and silicon

oxides. Among the different kinds of cement produced in India, portland

pozzolana cement, ordinary portland cement and portland blast furnace slag

cement are the most important because these account for around 99 percent of the

total cement production in India.

The portland variety of cement is the most common in India and it is produced

from gypsum and clinker. The ordinary portland cement and portland blast furnace

slag cement are used mostly in the construction of airports and bridges. The

production of white cement in the country is very less, for it is very expensive in

comparison to grey cement. White cement is usually utilised for decorative

purposes, marble foundation work, and filling up the gaps between tiles of ceramic

and marble.

Efforts must be made by the cement industry and the government of India to

ensure that the cement industry continues innovation and research to come up with

more and more varieties in the future.

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CAPACITY, PRODUCTION AND EXPORT

The Indian cement industry is the second largest producer of quality cement that

meets global standards. It comprises 130 large cement plants and more than 300

mini cement plants. The industry’s capacity at the end of the year 2007-08 reached

188.97 million tonnes from 166.73 million tonnes at the end of the year 2006-07.

Cement production during April to March 2007-08 was 168.31 million tonnes

compared to 155.66 million tonnes during the same period for the year 2006-07.

Dispatches were 167.67 million tonnes as against 155.26 million tonnes. Cement

export was 3.65. million tonnes compared to 5.89 million tones2.

The Indian cement industry is technologically very advanced, as a result of which

the quality of Indian cement is now considered the second best in the world. This

has given a major boost to the Indian export of cement.

The demand for cement in foreign countries is a derived demand, for it depends on

industrial activity, real estate and construction. Since growth is taking place all

over the world in these sectors, Indian export of cement is also increasing. A fair

amount of clinker and cement byproducts is exported by India. Export of Indian

cement has been mostly to the West Asian countries.

2. “Cement pricing” – Economic Times, India, 21st November 2008, Page# 3

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DEMAND DRIVERS

Infrastructure and construction sector are the major demand drivers. Some of the

demand determinants are economic growth, industrial activity, real estate business,

construction activity and investments in the core sectors.

The private housing sector is the major consumer of cement (accounting for 65 per

cent) followed by the government infrastructure sector at 15 per cent (down from

20 per cent). Less than one per cent of the cement produced is sold in bulk form,

unlike the US and Japan.

TECHNOLOGICAL CHANGE

Technology upgradation is a continuous process for any growing industry. This is

especially true for the cement industry. At present, the cement and building

materials produced in India meet international standards and benchmarks of

quality and can compete in international markets. The productivity perimeters are

nearing the theoretical bests and alternate means. Substantial technological

improvements have been brought about and today, the industry can legitimately be

proud of its state-of-the-art technology and processes incorporated in most of its

cement plants. This technology up - gradation is resulting in increased capacity

and reduction in the cost of cement production.

At present, 93 per cent of the total capacity in the cement 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. There is

tremendous scope for waste heat recovery in cement plants and thereby reduction

in emission level. One project for co-generation of power utilising waste heat in an

Indian cement plant is being implemented with Japanese assistance under Green

Aid Plan. The induction of advanced technology has helped the industry

immensely to conserve energy and fuel and to save materials substantially. The

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production of different varieties of cement like ordinary portland cement, portland

pozzolana cement, portland blast furnace slag cement, oil well cement, rapid

hardening portland cement, sulphate-resisting portland cement and white cement

conforms to the BIS specifications. It is worth mentioning that some cement plants

have set up dedicated jetties for promoting bulk transportation and export.

FUTURE OUTLOOK

Considering an expected production and consumption growth of 9 to 10 per cent,

the demand-supply position of the cement industry is expected to improve from

2008-09 onwards, resulting in price stabilisation. The cement industry is poised to

add 111 million tonnes of annual capacity by the end of financial year 2009-10,

riding on the back of an estimated 141 outstanding cement projects.

ROLE OF THE GOVERNMENT AND MANUFACTURERS

The cement industry occupies an important place in Indian exports, but high levies

and taxes, rules and regulations of the government, royalties on limestone and

frequent power cuts affect cement production and exports. The government needs

to take positive steps for export of cement to various countries. The demand and

supply of cement are expected to be high. So Indian manufacturers should

continuously upgrade to the latest technology to face stiff competition from the

world.

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STRUCTURE OF THE CEMENT INDUSTRY

MAJOR CEMENT PLANTS

Companies: 59

Plants: 116

Typical installed capacity per plant: Above 1.5 mntpa

Total installed capacity: 105 mntpa

Production 1998-99: 81.6 mntpa

Excise: Rs 350 / tonne

All-India reach through multiple plants

Export to Bangladesh, Nepal, Sri Lanka, UAE and Mauritius

Strong marketing network, tie-ups with customers, contractors

Widespread distribution network

Sales primarily through the dealer channel

MINI CEMENT PLANTS

Nearly 300 plants

Located in Gujarat, Rajasthan, Madhya Pradesh

Typical capacity < 200 tpd

Installed capacity around 9 million tonnes

Production: Around 6.2 million tonnes

Excise: Rs 200 / tonne

Mini plants are meant to tap scattered limestone reserves

However, most are set up in Andhra Pradesh

Most use vertical kiln technology

Production cost / tonne : Rs 1000 to Rs 1400

Infrastructural facilities not the best

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2.2 PROFILE OF SELECTED CEMENT COMPANIES

2.2.1 ACC Ltd

The Associated Cement Company Limited is a trend setter and a benchmark

for Indian cement industry. It enjoys excellent equity. 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, it is a cornerstone of its corporate objectives.

The historic merger of ten existing cement companies lead to the

establishment of ACC - melding into a cohesive organization in the year

19361 at Maharashtra. Its 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 , National Stock Exchange

and in London .

The company received an award as 'Good Corporate Citizen' for the year

2005-2006. During the year 2007 company acquired 100 % of the equity

stake of Lucky Minmat Private Limited for Rs 35 crs and also acquired 14.3

% equity stake in Shiva Cement Limited. Meanwhile the company divested

its entire equity shares in Almatis ACC Ltd to the Almatis group. 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, 2011.

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, for that company made a project for

augmentation of clinkering and cement grinding.

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As a result with this the capacity of Gogal works stands increased to 4.4

Metric Tonne Per Annum. ACC planed to expand the unit of Bargarh works

capacity to 2.14 MTPA together with 30MW captive power plant is

underway. The implementation of the projects for augmenting grinding

capacity at Madukkarai by 0.22 MTPA and New Wadi by 0.60 MTPA.

Production and sales of Ready Mix stood at 1.11 million cubic metres and

1.23 million cubic metres which was higher by 4.7 % and 9.8 % respectively

compared to the previous year. The sales value of Ready Mix stood at

Rs.367.02 crs which is 22.4% higher than the last year sales value. Ready

mix concrete business has been identified as an area of strategic priority.

ACC commissioned a Wind Energy Farm in Tamil Nadu to promote clean

and green technology. The company foresees substantial scope for growth of

this business in India and has accordingly finalised plans to expand Ready

Mix business in major cities including Tier1 and Tier 2 cities. ACC realizes

the growth potential of Ready Mix, the company has 26 plants for the same

and enhance to 46 in 20082. The company have major capital expenditure

projects in hand, as a result of these projects the total cement capacity of the

company will increase to about 30.4 MTPA by end of 2010 with total outlay

of Rs 4,000 crore

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2.2.2 Ambuja Cements Ltd

The Joint Venture between the public sector Gujarat Industrial Investment

Corporation (GIIC) and Narottam Sekhsaria & Associates was the reason for

confinement of the company. The company was incorporated in the year

1981 as Ambuja Cements Pvt Ltd and it was rehabilitated into a public

limited company on 19th March 1983 as Gujarat Ambuja Cements Ltd,

cement production is the role of the company in nature and a cost efficient

cement manufacturer in the country. It is a National Quality ISO 9002

certified company, the only cement company have this so. It's also the first to

receive the same and also have ISO 14000 Certification for environmental

systems. The total cement capacity of the company is 18.5 million tonnes

(MT), having five cement plants at Ambuja Nagar Gujarat (5 MT), Darlaghat

Himachal Pradesh (6 MT), Upperwahi Maharashtra (2.5 MT), Rabriyawas

Rajasthan (2 MT) and in Chhaattisharh West Bengal (3 MT). It is also having

three Bulk Cement Terminals at Surat with a storage capacity of 15,000

tonnes has bulk cement unloading facility, Panvel with a storage capacity of

17,500 tonnes has a bulk cement unloading facility and in Galle 120 kms

from Colombo, Sri Lanka. Handles million tonnes of cement annually. The

port terminal of the company Muldwarka Gujarat, all weather port, 8 kms

from Ambuja Nagar plant, handles ships with 40,000 DWT. Is also equipped

to export clinker and cement and import coal and furnace oil. A fleet of seven

ships with a capacity of 20500 DWT ferry bulk cement to the packaging

units.

The company's cement plant was commissioned in 19853, had set up in

technical collaboration with Krupp Polysius, Germany, Bakau Wolf and

Fuller KCP. The 12.6 MW diesel-generating sets were commissioned during

the year, which were imported in the year 1988-89.

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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. The Company undertook bulk cement transportation, by sea, to the

major markets of Mumbai, Surat and other deficit zones on the West Coast.

Transportation was to be carried out by three specially designed ships during

the year 1992. During the year 1994, the company's Muller location 1.5

million tonne cement project with clinkeriation facility at site in H.P and

grinding facility both at Suli & Ropar in Punjab was bespoken. In 1997,

Kodinar plant of the company was originated its commercial production with

an enhanced capacity.

Ambuja Cements had set up a $20 million clinker Grinding unit in Sri Lanka

in the year 1998. In the year of 2000 cement giants Larsen & Tubro (L&T)

and Gujarat Ambuja Cements entered a unique agreement to reduce

transportation costs in dispatching bulk cement in Gujarat and also in the

same year the company has entered into an annual contract with a Soinhalese

firm, Mahaveli Marine Cement, to supply around 2.5 lakh tonnes of cement.

The company has kick started its operations in Sri Lanka with help of a

cement terminal in the port of Galle, in the south of the island country, which

was started by the company. The commercial production of Maratha Cement

Works plant of the company was started in the year 2002, a new 2-million

tonne Greenfield cement plant at Chandrapur, Maharashtra has started its

commercial production on June of the year and the merger of Ambuja

Cement Rajasthan with the company was happened in the same year. Again

in the year 20044, the company merged Ambuja Cement Rajasthan with

itself.

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During 2004-05 the company has installed a cement mill with a capacity of

80 TPH at Darlaghat and commenced its commercial production in February

2005. The company have commissioned a captive thermal power plant with

two 12 MW Steam Turbo Generators (STG), with two boilers of 45 TPH

capacity each at a cost of Rs.94 crore. The first STG was commissioned in

February 2005 and the second in May 2005. The company has amalgamated

its subsidiary company Indo-Nippon Special Cements Ltd in July of the year

2005. ACL has entered into a partnership with Holcim Ltd of Switzerland

through Ambuja Cement India Ltd (ACIL) during 2004-05. The company is

setting up new clinker capacity at Bhatapara in Chattisgarh and Rauri in

Himachal Pradesh, each having a capacity of 2.2 million tonnes per annum

cost of 1600 crore, the enchantment in the year 2007 around the amount of

about Rs 3500 crore in different areas of the company.

The company has awarded for its credit, the National Award for commitment

to quality by the Prime Minister of India, National Award for outstanding

pollution control by the Prime Minister of India, Best Award for highest

exports by CAPEXIL and Economic Times - Harvard Business School

Association Award for corporate excellence in different years. The company

was adjudged as the top Indian company in the cement sector for the Dun and

Bradstreet - American Express Corporate Awards 2007. The company

developed a unique homespun channel management model called Channel

Excellence Programme (CEP) for marketing their product. Over 7000

dealerships and 20,000 retailers across India are covered under this model.

The company name was changed from Gujarat Ambuja Cements Limited to

Ambuja Cements Limited on April, 20075, the word Gujarat was dropped to

reflect the true geographical presence of the company.

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In the last decade the company has grown tenfold. The first company in India

introduced the concept of bulk cement movement by the sea transport. The

company's most distinctive attribute, however, is its approach to the business.

Ambuja follows a unique homegrown philosophy for successful survival.

Ambuja is the most profitable cement company in India, and one of the

lowest cost producers of cement in the world.

2.2.3 Andhra Cements Ltd

Andhra Cement Ltd.(formerly Andhra Cement Company Ltd.), incorporated

in Dec.'36, was promoted and owned by the Sadu Jain group. It manufactures

and markets cement under the Durga Prasad trade name. It's first unit was

commissioned in Vijayawada in 1940. Later, it was extended in three stages

in 1951, 1958 and 1970. By 19876, total capacity reached 2.4 lac tpa of

cement. The company possesses mining leases over about 300 acres in

Gammalapadu.

The total production of Cement during the year is 6.58 lac MT when

compared to previous year of 6.28 lac MT an increase of 5%.The company

for its Vizag Plant achieved ISO 9002 certification in December 2000.

In Dec 2001 the BIFR, on taking note of the fact that ACL and its promoters

have failed to revive the company under the sanctioned Scheme of 1994,

declared the sanctioned scheme as 'failed' and appointed IDBI as the

operating agency(OA). IDBI has also been asked by BIFR by it's latest order

to invite offers for takeover/leasing/amalgamation/merger for rehabilitation,

with or without one-time settlement of the dues of the FIs and banks

including measures envisaged under SICA(Special Provision) 1985.

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2.2.4 Binani Cement Ltd

Binani Cement is one of the leading cement manufacturing company in India.

The company is one of the top companies in that industry in terms of

efficiency and performance. They are engaged in the manufacture of ordinary

portland cement and portland pozzolana cement. They are having their

production facilities in Sikar and Sirohi in Rajasthan.

Binani Cement Ltd was incorporated on January 15, 1996 as Dynasty Dealer

Pvt Ltd in Kolkata, West Bengal. The name changed to Binani Cement on

April 23, 1998. Subsequently, the company was converted into a public

company on October 6, 1998. The company is a subsidiary of Binani

Industries Ltd, which has diverse manufacturing interests in cement, zinc and

glass fiber.

Binani Cement Ltd commenced commercial production in November 1997 at

Sirohi in Rajasthan. The Sirohi facility was set up with the support of F L

Smidth of Denmark and Larsen & Toubro Ltd. The Company has two

limestone mines, namely Amli and Thandiberi, operated on a long term lease

basis which is at a distance of 2Km and 7Km from the plant respectively.

The Company's cement is marketed under the brand name of 'Binani' over the

last 8 years, has established significant brand recall especially in the

Rajasthan and Gujarat. In March 16, 2007 the company completed the

cement expansion project of 3.05 MTPA and the kiln was test fired and the

commercial production was started from December 6, 20077.

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The company bagged the best overall performance shield for the year 2006

during the 30th Mines Safety Week organised by Directorate of Mines,

Udaipur. In the year 2007, the company's Amli mines again bagged overall

best performance (Hilly Terrain) shield for the year 2007 during the 31st

Annual Mines Safety Week held under Directorate of Mines, Udaipur. In

October 2007, the company's Pragati Quality Circle bagged the excellent

award at the 6th Local Chapter Conventions of Quality Circles held at

Rajsamand and also they won the Distinguished Award 21st National

Chapter Conventions of Quality Circles at Kolkata held in December 2007.

During the year 2007-08, Krishna Holdings Pte Limited (KHL) and the step

down subsidiary Shandong Binani RongAn Cement Company Ltd

(SBRCCL) became the subsidiaries of the company. Mukundan Holdings Ltd

became subsidiary on February 27, 2008. The company has laid a Railway

siding from factory to the nearest railway station Keshavganj, covering a

distance of 6.5 KM. In March 2008, the company successfully commissioned

the cement grinding unit at Neem ka Thana which increases the total capacity

to 6 Million MTPA.

The company commissioned a captive power plant having capacity of 22.3

MW during the year. Also they are in the process of setting up one more

additional captive power plant having capacity of 22.3 MW at their existing

location at Binanigram which is expected to be commissioned in the financial

year 2008-098.

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The company proposes to set up a Greenfield Cement plant of 2.5 million

MTPA at an estimated cost of Rs 822 crore which is proposed to be funded

through a mix of debt and internal accruals. Also, they are in the process of

expanding their capacity in overseas plants located in China and Dubai. The

Dubai plant is expected to be completed during the financial year 2008-09.

2.2.5 Birla Corporation Ltd

Birla Corporation Limited (BCL) is the flagship Company of the M.P. Birla

Group. Incorporated as Birla Jute Manufacturing Company Limited in the

year 19199. The company has products ranging from cement to jute goods,

PVC floor covering, as well as auto trims (jute felt-based car interiors

manufactured with German technology). The Cement Division of Birla

Corporation Limited has seven plants, having an installed capacity of 5.8

million tons. These plants manufacture varieties of cement, including

Ordinary Portland Portland_Cement (OPC), 43 & 53 grades, fly ash-based

Portland Pozzolana Cement (PPC), Portland Slag Cement (PSC) and low-

alkali Portland cement. Recently, the Company has started producing

Sulphate Resistant Cement (SRC) and it has been well accepted in the

market. The Jute Division of the company manufacturing more than 120

tonnes of a variety of jute products in Birla Jute Mill. The product range

comprises of almost every major application of jute - the most versatile, eco-

friendly, biodegradable fibre available, Jute- durable, natural and anti-static.

The Auto Trim Division of the company has been outfitting major Indian

cars with natural fibre-based interiors. Birla Corporation Limited's

subsidiaries consist of Assam Jute Supply Company Limited, Talavadi

Cements Limited and Lok Cements Limited.

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During the year 1996, a joint venture company Birla Redland Ready mix

Ltd.' was incorporated with Redland PLC, UK to set up facilities for

manufacture of ready mix cement concrete in India. Effective from 31st

March of the year 1997, the name was again changed from Birla Jute &

Industries Limited to Birla Corp Limited. In 1998, the company had sets up a

fly ash-based cement-grinding unit at Rae Bareilly in Uttar Pradesh. The

name was again changed from Birla Corp Limited to the present name Birla

Corporation Limited in 27th October 1998. The company's unit, Birla

Synthetics consider as Suspension of Work from 2nd November 1998.

During the year 2001-02, the company had modernized/upgraded the plant at

Cittor Cement Works at Chittorgarh. During the year 2002-03, the company

had developed new product lines, Desktop and Bulletin Board. In 2003-04,

the Satna unit of the company was awarded the first prize for Noise,

Vibration & Aesthetic Beauty and also the first prize for maximum

percentage reduction in electrical energy consumption per MT of clinker

produced. During April of the year 2004 the company has decided to close its

Birla Synthetics at Birlapur.

The company has expanded its installed capacity of Auto Trim Parts by

36000 Pcs during the 2004-05 and with this expansion the total installed

capacity of Auto Trim Parts has increased to 603000 Pcs. The company's

unit, Birla Carbide & Gases was permanently closed from 31st January of the

year 200510. The company's capacity enhancement project at Durgapur viz.

Durga Hitech Cement, which was commenced its commercial production

during the year 2005-06. BCL received the Amity Corporate Excellence

Award during the same year 2006-07. Credit Analysis and Research Limited

(CARE) assigned 'CARE AA' rating to the company for long term borrowing

programme in the year 2006-07.

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2.2.6 Chettinad Cement Corporation Ltd

Incorporated in the year 1962, Chettinad Cement Corporation (CCCL) has

been awarded the ISO 9002 certificate by the Bureau of Indian Standards, in

1994. It is the first company in Tamilnadu to be honoured with the

certificate, in the field of mining.

The Karur unit of Chettinad Cements has been functioning with the highest

operating ratio for any cement unit in the southern region. In Sep. 94, the

company commissioned 16 wind power generators near Poolavadi,

Coimbatore. In addition, 26 wind power generators have been installed in

Mar.'95, in the same place. While 12 Nos of 225 KW each of Wind Power

Generator commissioned in 1995-96. Totally 66 wind power generators for a

capacity of 17.35 MW have been installed in four phases and they are

functioning well. The project was financed by the Industrial Finance

Corporation of India (IFCI) and internal accruals.

CCCL has diversified into shipping. Its shipping fleet consisits of two bulk

carriers viz m.v. Chettinand Tradition and m.v. Chettinad Prince. The Second

Cement plant at Karikkali,Tamil Nadu faced some teething problem in 2002

and in 2003 the plant was successful in making it fully operational with

optimum efficiency. During 2002-03 the comapny completed the Rights

Issue of 84,31,700 equity shares in the ratio of 2:5 at a premium of Rs.26/-

per share. The company has commissioned a 15 MW Captive Thermal Plant

at its plant at Karikal during October 200411.

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2.2.7 Dalmia Cement (Bharat) Ltd

Dalmia Cement Bharat Ltd is an India-based cement company. The company

is engaged in the manufacture of cement used in the construction of oil well,

railway sleepers and airstrips. The company also produces sugar, ethanol and

power. It also produces and sells Dead Burnt Magnesite, and Magnesia-

Carbon Bricks and Monoliths, iron ore, Multilayer Ceramic Chip Capacitors

& Chip Resistors and consumer electronic equipment like Audio Deck

Amplifiers, TV (both color and black & white). The Group owns a Wind

Energy Farm.

The company's cement plants are located at Tiruchirapalli and Ariyalur in

Tamil Nadu and Cuddapah in Andhra Pradesh. Their wind farm is located at

Kanyakumari in Tamil Nadu. Their sugar plants are located at Sitapur and

Dhahjahanpur in Uttar Pradesh. Their electronics division is located at

Bangalore in Karnataka. The company has their own Research and

Development arm at Salem in Tamil Nadu.

Dalmia Cement was established in 1935 by Jaidayal Dalmia. In the year

1939, the cement unit was started, with the installed capacity of 250 tonnes

per day. They manufactured cement by semi-dry process. The machinery

used for cement production was imported from Germany. In the year 1949,

they installed a 500 tonnes per day wet process kiln supplied by FLS Smidth,

Denmark. The company was originally incorporated in the year 195112.

In the year 1958, the company commenced their Magnesite operations. In the

year 1959, the company undertook the expansion in the cement

manufacturing plant with installation of another 500 tonnes per day wet

process Folax kiln supplied by F L S Smidth, Denmark. In the year 1970, the

company acquired Govan Travels.

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In the year 1982, a 200 tonnes Vertical Shaft Kiln was installed using Fuel

Slurry process. In the year 1986, the company improved their packaging and

presentation by using ply bags for cement. In the year 1987, they used lignite

as fuel and reduced their variable cost. Also, they expanded 1500 TPD dry

kiln process. In the year 1993, the company started their wind farm. In the

year 1997, they commissioned the VRM-Cement Grinding Mill. They

completed the 3300 TPD-KHD upgradation in the 2002.

During the year 2003-04, the company installed a new magnetic separator

plant at a cost of Rs 30 lakh, which would help recycling of earlier rejected

material. The company developed new export markets in the Middle East and

South East Asia during the year.

During the year 2004-0513, the company received the trial order of Magnesia-

Carbon Bricks from the Vizag Steel Plant. In March 2005, they completed

the installation of the 27 MW Captive Thermal Power Plant and was

commissioned during the year 2005-06. The company expanded the

production capacity of cement by 2,266,000 tonnes to 3,500,000. Also, they

expanded the production capacity of sugar by 2500 TCD to 7500 TCD.

Dalmia Sugar Ltd, a subsidiary company got amalgamated with the company

with effect from June 8, 2005.

During the year 2006-07, the company commissioned two bagasse-based co-

generation power plants at Jawaharpur and Nigohi - each of 27 MW. These

newly installed generation capacities have not only given the Company

significant operational advantages but also opened new revenue streams. It

has signed a Power Purchase Agreement (PPA) with the Uttar Pradesh Power

Corporation Ltd (UPPCL), and is currently supplying power to the grid.

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Dalmia Cement (Meghalaya) Ltd, a subsidiary company got amalgamated

with OCL India Ltd pursuant to the orders of the Gauhati High Court vide

order dated October 15, 2007. During the year 2007-08, the company set up

two new cement plants at Cuddapah (Andhra Pradesh) and Ariyalur (Tamil

Nadu) of 2.25 MnTPA each. The greenfield project at Cuddapah in Andhra

Pradesh is expected to be commissioned during the financial year 2008-09.

In July 2008, Dalmia Cement Ventures Ltd, a subsidiary of the company, is

setting up greenfield cement plants of upto 10 MTPA capacity in different

parts of the country in a phased manner. In December 2008, Eswar Cements

Pvt Ltd was amalgamated with the company.

2.2.8 India Cements Ltd

India Cements Limited had enter into industry 62 years ago, it was

incorporated in the year of 1946. The first cement unit was commissioned in

194914 at Sankarnagar, Tamil Nadu. Its a company participating in the areas

of Cement, Clinker, Ready mix, Sugar, Joint Sector in Financial Institution,

shipping and real estate development. ICL have four subsidiaries and

associated companies each across the country. Industrial Chemicals &

Monomers Limited, ICL Financial Services Limited, ICL Securities Limited

and ICL International Limited are comes under its fold. In associated

companies, Coromandel Sugars Limited, India Cements Capital Limited,

Trishul Concrete Products Private Limited and Coromandel Electric

Company Limited are in under. The company have 7 plants in various parts

of Tamil Nadu and in Andhra Pradesh.

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In the year of 1990, ICL acquired Coromandel Cement plant at

Cuddapah,consequently installed capacity rose to 2.6 million tonnes per

annum. During 1991-92, the company started shipping activities by time-

chartering dry bulk-cargo carriers. ICL successfully floated a US$ 50 million

Global Depositary Receipts issue in the year 1994. It acquired its fifth bulk

carrier in 1995 and in the year 1996 ICL's green field cement plant at Dalavoi

commenced commercial production with an Installed capacity 90,000 TPA.

In 1997 India cements acquired Aruna Sugars Finance Ltd which was later

renamed as India Cements Capital & Finance Ltd. It also acquired Cement

Plant of Visaka Cement Industry, at Tandur, Ranga Reddy district of Andhra

Pradesh with Installed capacity 9,00,000 Tonnes.The cement division of

Raasi Cement (RCL) was vested with the company from April.1998 under a

scheme of arrangement. Also during the same year the company hived off its

shipping division to ICL Shipping (ICLS). It also acquired Cement

Corporation of India's Yerraguntla Cement Plant at Andhra Pradesh with an

Installed capacity 4,00,000 Tonnes. In October 1999, ICL Securities, the

company wholly owned subsidiary acquired 49.05% of the equity share

capital in Sri Vishnu Cement (SVCL), simultaneously, Raasi Cement also

acquired 39.5% of the equity capital of SVCL. At present the company along

with its subsidiary holds 94.16% of the share capital of SVCL and is now a

subsidiary of the company.

ICL got the best Environmental Excellence in Limestone Mines by the

National Council for Cement and Building Materials for the year 2003-04

through its Dalavoi cement factory. The Sankarnagar works earned the State

Safety Awards for the year 2003 and 2004. The unique Waste Heat Recovery

System for generation of power from waste gas at Vishnupuram plant was

commissioned with generating power of 7.7MW during the year 2004-05.

The company also received a special award from CAPEXIL (Sponsored by

Ministry of Commerce and Industry, Government of India) in recognition of

outstanding export concert in respect of cement and clinker for the year

39

2004-05. The company's in-house magazine 'Compass' was awarded a merit

certificate in the 11th All India in-house magazine contest 2006.

Research & Development unit at Dalavoi of the company has been

recognized as an In-House R&D center by the Department of Scientific and

Industrial Research, Ministry of Science and Technology, Govt of India. The

waste heat recovery project at Vishnupuram plant has been registered as a

Clean Development Mechanism project by UNFCCC, as worth of this

company enable to receive Carbon Credits from January 2007 for generation

of power through waste heat recovery. ICL taken up the replicating the

production capacity at Malkapur plant through one more line of a capacity of

1.2 million tonnes and setting up grinding plant in Chennai (Tamil Nadu) and

in Parli (Maharashtra).The company look out the plant emerge in Rajasthan

and Madhya Pradesh.

2.2.9 JK Lakshmi Cement Ltd

Chronicle of the company thus began in the state of Rajasthan during the

year 193815. One of the established names in the cement industry, JK

Lakshmi Cement (JKLC) Ltd has state-of-the-art plant at Jaykaypuram,

district of Sirohi, Rajasthan having an annual capacity of 3.65 million tonnes.

With the use of the latest technology from M/s Blue Circle Industries and

modern equipments from M/s Fuller International of USA, the company

going from strength to strength and produce JK Lakshmi Cement, JK

Lakshmi plast and JK Lakshmi Power Mix. It is also the first cement

producer of Northern India to be awarded an ISO 9002 certificate and be

accredited by NABL (Department of Science & Technology, Government of

India) for its Lab Quality Management systems.

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During the year 1993-94, the company had received an ISO 9002 certificate.

The Company name was changed to J.K Corp Limited from Straw Products

Ltd in 24th February of the year 1995 and also in the same year entered into

Multi Product Corporation Manufacturing Paper, Cement, and Magnetic

Tape. In the year 1998, the company introduced a new brand Lakshmi

Chattan. The Company during the year has bagged the prestigious Greentech

Safety Award 2003-04 for Safety and Environment from the Greentech

Foundation and the Golden Peacock National Award for Environment

Management System from the World Environment Foundation. During the

year 2004-200516., the company had exited from Magnetic Tape business and

in the same year, the company changed its brand name from Lakshmi

Cement into JK Lakshmi Cement. The Company during the year 2004-05

commenced marketing of Ready Mixed Concrete (RMC) from Gurgaon

based plant under the brand name JK Lakshmi Ready Mix Concrete. The

Company name was changed to JK Lakshmi Cement Limited with effect

from 6th October of the year 2005. The Company's Scheme of de-merging its

Investment Division to another company had been completed in the year

2005-06.

The Scheme of Reconstruction, Arrangement and Demerger between JKLC

and Ashim Investment Company Limited (AICL) had become effective from

31st March of the year 2006. JK Lakshmi Cement Limited was declared a

winner of the Golden Peacock Award for Corporate Social Responsibility for

the year 2007. JKCL had commissioned its Phase I Captive Thermal Power

(18 MW) plant in March of the year as its significant milestone. During the

same year of 2007, the company had enhanced its Kilns, further, it started

cement mills No.4 and 5.

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2.2.10 K C P Ltd

A multi-product company with two sugar mills, a downstream distillery, a

cement plant and an engineering division, KCP was initially a sick sugar unit

(cap. : 600 tpd). It was taken over by the late Velagapudi Ramakrishna in

1941. The merger of Challapalli Sugars - a BIFR company - with it in 1988

and expansions have increased its sugar capacity tenfold to 6300 tpd over the

last five decades.

The cement factory, set up in 1958, was the first dry process plant in India.

The engineering division was set up in 1955 as an in-house venture to

manufacture sugar machinery required by the company. Manufacture of

machinery required for cement, chemicals, steel castings, etc, were later

added to this division. Both the cement and engineering divisions have been

accredited with the ISO 9002 and ISO 9001 certification respectively in

1994.

KCP hived off its sugar and industrial alcohol business, which was

transferred to a new company, KCP Sugar Industries Corporation. The

Company also undertook a joint venture with Vantech Industries for the

manufacture of specialised insecticides. KCP promoted FCB-KCP, a joint

venture with FCB, France, in a 40:40 equity participation. The new company

is to manufacture and supply state-of-the-art machinery and technology to

clients in the sugar industry both in India and abroad.

The cement unit of the company continues to retain the ISO 9001

certification while the engineering unit was accredited to use the symbol 'S'

and 'U' of the American Society of Mechanical Engineers (ASME) for the

manufacture and assembly of power boilers and pressure vessels,

17. www.kcp.co.in

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respectively on 15 May'96. KCP has also received the Certificate of Merit for

outstanding export performance during 1994-95 among Non-SSI exporters in

industrial machinery panel for manufacture of sugar, paper, chemical, cement

and pharmaceuticals.

The company had set up 5 mini-hydel units aggreagting 8.25 MW capacity in

the Guntur branch canal of the Nagarjuna Sagar Dam. Electricity generated

in this unit is wheeled to the cement unit for use. During 2001-02 the

company entered into an agreement with Andhra Pradesh Transmission

Corporation Limited(APTRANSCO) for wheeling the generated energy at

Hydel stations to the cement plant with a wheeling charge of 2% fixed for a

period of 20 years.

2.2.11 Madras Cements Ltd

Madras Cements (MCL), a flagship company of the Ramco group, is a major

player in the blended cement category in south India. The company was

incorporated in the year 195718. MCL is the sixth largest cement producer in

the country and the second largest in South India.

The Company undertook to replace the 4 cement mills at its Ramasamyraja

Nagar Works, which were 20 years old, by a single new Combidan Cement

Mill'. The mill was commissioned at end of the year 1985. A 132 KVA sub-

station and the limestone crushing plant were installed during the same year.

The project was commissioned during December of the year 1986. Two D.G.

sets were installed in the middle of the year 1988 to meet 60% of the unit's

power requirement at Jayanthipuram. The Company had set up the 4 MW

windmill farm in the year 1992 at Muppandal, Kanyakumari district, Tamil

Nadu. Asia's largest one to be commissioned in the Private sector was set up.

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All the 16 wind turbines of the company were commissioned in March of the

year 1993. In the same year 1993, an additional capacity was created by

adding 8 Nos. wind turbines of 250 KW each at Muppandal wind mill farm

taking the generation capacity to 6 MW. During the year 1994, MCL had

upgraded the capacity of its Jayanthipuram Unit to 1.1 million tonnes and

also upgraded the cement mills capacity in R. R. Nagar. The Company

substantially increased the capacity of windmills by installation of 70 more

windmills. In the year 1995, the company enhanced power generation

capacity at Jayanthipuram unit to 15.3 MW by commissioning an additional

diesel generator set to maintain normal production in view of frequent

power-cut and power tripping. During the year 1997, MCL had

commissioned its third cement plant in Alathiyur; it was the second in Tamil

Nadu. The clinker plant of the Alathiyur unit was commissioned in March

while the grinding unit was commissioned in May of the same year 1997.

The Company had embarked into Ready Mix Concrete business in the year

1998. Also in the same year, MCL made tie-up with Visakhapatnam Steel

Plant (VSP) for procuring slag, a blast furnance residue and a crucial input

for slag cement.

MCL tied up with Gas Authority of India Ltd (GAIL) for supply of gas and

the fuel supply agreement was inked in 15th April of the year 1999. Also tied

up with Oil and Natural Gas Corporation (ONGC) for supply of 25,000 cu

mtrs of gas per day from its Nallore well, near Mannargudi in Tamil Nadu. In

the same year 1999, another one tie-up was made with Vizag Steel Plant for

supply of slag. During the year 1999-00, the company's slag grinding project

at Jayanthipuram for manufacture of blended cement was commissioned and

also the capacity of the Alathiyur unit was expanded by 0.2 million TPA.

During the year 2000, the company had launched the Ramco Super Steel

cement in Tamil Nadu. The Company's second unit at Alathiyur with a

capacity of 15 lac tonnes was commissioned in January of the year 2001. The

second klin at R.R Nagar was upgraded in May of the year 2001 with the

44

installation of fixed inlet segment to the cooler, new calciner and modifying

pre heater cyclone, thereby increasing the capacity of the unit to 11 lac TPA

of blended cement. With the help of M.Tec, Germany, the company started

new project Dry Motor Plant for manufacture of high technology

construction products such as render, skimcoat and dry concrete and its

production commenced from January of the year 2003 at Sriperumbudur.

During 2004-05, The Company commissioned a 36 MW Thermal Power

Plant at Alathiyur. The company, for the first time in India, commissioned a

surface mine to modernise the mine operations at Ramasamyraja Nagar

factory.

The Company decided to establish grinding units in the states of Tamil

Nadu, Andhra Pradesh and West Bengal in May of the year 2007. During

October of the year 2007, MCL earmarked Rs 1.05 billion investments for set

up the grinding mill at Kolaghat in Midnapore, West Bengal. With an eye on

diversification, MCL is planning to enter into industries such as sugar,

pharmaceuticals, power & power equipments and textiles. As at March 2008,

Madras Cements lines up Rs 15 billion expansion. It will invest Rs 15.24

billion to increase its capacity.

2.2.12 Mangalam Cement Ltd

Mangalam Cement Limited (MCL), the ISO 9001:2000, IS/ISO 14001:2004

and ISO 18001:2007 certified company was incorporated on 27th October

197619. As a B.K. Birla Group wing, the company is producing cement in 43

and 53 grades and Portland Pozzolana Cement (PPC) using the dry process

and marketing them under the brand names of Mangalam and Birla Uttam.

Manufacturing units of the company namely Managalam Cement and Neer

Shree Cement are both located at Morak in the Kota district of Rajasthan.

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The Company commenced its business on 15th January of the year 1977. The

existing first plant of the company was gone to stream in March of the year

1981. Buildings, plant, machinery and railway siding of the company were

revalued in January of the year 1988. In October of the year 1992, the

company came out with an issue of equity shares. Commercial production in

the new cement unit at Neer Shree Cement was commenced in April of the

year 1994, as increased the company's capacity from 4 lacks TPA to 10 lacks

TPA. MCL bagged first prize for Reclamation and Rehabilitation of Land

Degradation in the North Zone during the year 1995-96 from Indian Bureau

of Mines. During the year 1996-97, the company had accredited with ISO-

9002 certificate in recognition of its quality systems. In view of erosion in the

entire net worth of the company by reason of providing for sales tax liability

not earlier provided for, the company had registered as a sick industrial

company in the year 2000.

In May of the year 2002, the Board for Industrial and Financial

Reconstruction (BIFR), had declared the company as sick industrial

company. In the same year of 2002, MCL had submitted the Revival Package

to Industrial Development Bank of India (IDBI), the Operating Agency

(OA), was not accepted by them, and advised to resubmit. Hence, the

company again submitted the Revised Revival Package to IDBI on 8th

September of the year 200320. The revival package was accepted and BIFR

sanctioned the scheme for the revival of the company. M/S IDBI was

appointed as Monitoring agency during the year 2005. During the year 2006-

07, the got good phase, in the year only company declared dividend to it

shareholders after very long period. The Company's captive thermal power

plant with capacity of 17.5 MW was commissioned during August of the

year 200720 and started generating power.

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The Company intends to increase capacity by setting up a 1.5 to 2 million

MTPA plant either at the existing site or in the Murena district of Madhya

Pradesh. A memorandum of understanding has been signed with the Madhya

Pradesh Government for setting up a cement manufacturing plant, which will

depend on the grant of prospecting license and availability of limestone

reserves proved after prospecting.

2.2.13 OCL India Ltd

OCL India (formerly Orissa Cement), the manufacturer of the Konark brand

Dalmia portland slag cement, is a highly diversified company. Its product

portfolio includes cement, refractories, soda ash and ammonium chloride.

However, cement and refractories continue to be the mainstay of its

operations. It switched over production from the wet to the dry process to

overcome pollution problems as part of its modernisation and expansion

programme in 1991-92.

Well known for the manufacture of sophisticated world class refractories, it

has earned laurels for its high-tech new-generation refractories. The unit,

which came into existence in 1956, has an installed capacity of 1.41 lac tpa

of various refractories. In the past, OCL had manufactured a special kind of

alumina carbon ladle shroud, an import substitute, which enables it to

produce clean steel. The company received the Best Import Substitute award

in 1992 in the 52nd All-India Industrial Exhibition held at Hyderabad.

The company has been awarded the ISO 9001 certification for its silica

products. Production of continuous casting refractories and new-generation

castables and pre-cast blocks set up in a separate section, both in technical

collaboration with TYK Corporation, Japan, commenced in 1994-9521. It

exports to the US, Australia, Latin America, and Africa.

21. www.oclindia.com

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During 1996-97, the company received ISO 9001 certification for its

magnesia carbon bricks, basic refractories, monolithics and slide gate

refractories. The company also made good progess in marketing of its

monolithic range of products like castables, precast seating blocks, rinsing

lance etc. manufactured in technical collaboration with TYK Corporation,

Japan.

The company had entered into a Memorandom of Understanding (MOU)

with Steel Autority of India Limited (SAIL) for supply of substantial

quantities of refractory. Company has upgrade its products range & set up

facilities for manufacture of purging elements. Company has introduce new

high tech product as an import substitute & technical support for this

products has been taken from M/s PLIBRICO Germany. Company received

Sepcial Export Award for 1997-98, consecutively for 4th Year by CAPEXIL

for good performance in export. The company has the distinction of being the

first refractory manufacturer to have ISO 9001 certification for the widest

range of refractories in the country.

The company has expanded the installed capacity of Sponge Iron during the

financial year 2003-04 by 30000 Tonnes and with this expansion,the total

capacity has risen to 90000 Tonnes.

2.2.14 Panyam Cements & Mineral Industries Ltd

Panyam Cement and Mineral Industries (PCMIL) incorporated in 195522 has

diverse interests in cement, chemical and engineering. The company's cement

plant at Kurnool, Andhra Pradesh, has an installed capacity of 5.31 lac TPA.

Other capacities are 10000 tpa for steel wire, 14850 tpa for calcium carbide

and 1800 tpa for acetylene black.

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PCMIL manufactures portland cement under the brand name Pyramid. Its

steel wire division came into existence when Deccan Wires was

amalgamated with the company. The company's major clients include Union

Carbide, Geep Industrial Syndicate, Lakhanpal National, IOC, Chemplast,

etc.

It installed additional generating sets to overcome the power cuts imposed

by the Andhra Pradesh Electricity Board. Its cement division is in the process

of fabricating a grate cooler in-house, to change the existing planetory cooler

which will enhance the capacity of the kiln.

In 1999-2000, the operations in the chemical division continued to be

suspended and the company is seeking permission for closure of the division.

The cement division is also under strain due to steep fall in realisations.

The Cement Division is planning to step up its production in full capacity

level at the fag end of the current financial year.

2.2.15 Shree Cement Ltd

Shree Cement Ltd., 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 197923. Shree has two plants in Beawar, Rajasthan

with 2.6 million tonne installed capacity. Shree's is the largest single location

manufacturer with production in Northern India. The company markets its

products under two brands- Shree Ultra Ordinary Portland Cement (OPC)

and Shree Ultra Red Oxide Cement (ROC).

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The company has undertaken new activities in the field of leasing and hire

purchase during 1994-95. The company has tied up with Christian Pfeiffer &

Company, Germany, for installing a horizontal impact crusher to pre-crush

clinker before using it in the cement mill to upgrade cement output and save

energy.

It has also tied up with IKN, Germany, to incorporate their KIDS system in

the clinker cooler to improve efficiency of the clinker cooler and save heat.

The company has been awarded by KPMG Quality Registrar, USA

certificate of ISO 9002 durning the year. In Oct.'97, the Raj Cement was

commenced production. The company has successfully commissioned its

new cement plant of 1.24 million tonne capacity and has already attained

100% capacity utilisation.

The company's modernisation and expansion plan to increase its installed

capacity from 20 to 26 lakhs TPA was implemented in December

10,2001,three weeks before the scheduled time.

During 2001-0224 the company exerise to commission a captive 36 MW

thermal power project at a cost of Rs.120 crores. An EPC contract was

signed with Thermax Ltd in September,2001 and the civil work commenced

in October 2001 and the project is expected to be commissioned by

December,2002.

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During 2004-05 the company was in the process of setting up a new plant

with a capacity of 1.2 MTPA which is scheduled to start functioning by the

third quarter of this year at Village Ras, about 32 kms away from the existing

location. This plant is designed to produce a premium grade of cement

'Bangur Cement'. The estimated project cost was Rs.304 crore.

During August 200525 the company has commissioned a 6 MW Captive

Thermal Power Plant at its cement manufacturing facility Rajasthan. The

total capacity of its Captive Thermal Power Plant has gone up from 36 MW

to 42 MW. The additional capacity would enable Company to meet

requirement of power for its upcoming 'Bangur Cement Project'.

25. www.sreecements.com