Ambuja Cements was set up in 1986. In the last decade the company has grown tenfold.

The total cement

capacity of the company is 18.5 million tonnes. Its plants are some of the most efficient in the world. With environment protection measures that are on par with the finest in the developed world. The company's most distinctive attribute, however, is its approach to the business. Ambuja follows a unique homegrown philosophy of giving people the authority to set their own targets, and the freedom to achieve their goals. This simple vision has created an environment where there are no limits to excellence, no limits to efficiency. And has proved to be a powerful engine of growth for the company. As a result, Ambuja is the most profitable cement company in India, and one of the lowest cost producer of cement in the world. In essence, cement is a simple business. Unlike other industries it does not suffer rapid technological obsolescence or shifting consumer trends. Therefore, it constantly attracts new investments. Which results in surplus capacity. This means only the very efficient players can prosper.

Our people recognize this. And their efforts to constantly raise efficiency has not only raised the bar at Ambuja. But across the industry as well.

Environment protection measure that conform to the worlds best.

The pollution levels at all our cement plants are even lower than the rigorous Swiss standards of 100 mg/NM3. The air is so clean that a rose garden flourishes right next to the main plant.

Benchmarking quality standards for the industry.

Ambuja has received the highest quality award - the National Quality Award. The only cement company to do so. Its also the first to receive the ISO 9002 quality certification.

Reinventing cement transportation.

Almost 90% of cement in India travels by rail or road. And in bags. Our people realized that the only way to speed up transportation was a completely different approach. The result: a bulk transporting system via the sea. Making us the first company to introduce the concept of bulk cement movement by sea in India.

When we started out, we approached the cement business with an open mind. Some things struck us immediately. To compete with the older, established players who had already written off their plant cost, it was important to have the lowest capital cost per ton of cement. Our plants would have to be set up in record time. Our capacity utilization would have to be above 100%. And our power consumption would have to set a record low. Given this line of thinking, empowerment was not just a fashionable term, it was the only way to achieve our goals. If costs had to be controlled, it seemed absurd for engineers to check back with their seniors for every little decision. The time lost would be far more expensive than any errors they would make. It was the same with controlling power consumption. Who better than the engineers to suggest ways to cut costs. They knew the plants inside out. It made sense to listen to them. Over time this has become a natural company culture: I can.. The kiln at our Ambujanagar plant is 20 years old. Yet it keeps increasing productivity year after year. Many would consider this an impossible task. Yet, our people continue to achieve ever higher efficiency and productivity, not just at Ambujanagar, but at all our other plants. In Himachal, for instance, they've managed to push up production and bring down power costs. At a plant that was already functioning above capacity. At the same plant they've managed to cut stabilizing time (a critical task in a cement plant) from upto 18 months to a mere 3 months.

At our cement shipping terminals in Gujarat, with a few minor modifications, they've succeeded in exporting clinker, and importing higher quality and far cheaper coal and furnace oil for our captive power plants. At our Mumbai terminal meanwhile, they've increased the handling capacity to 100,000 tonnes as against the terminals stated capacity of 60, 000 tonnes. With no additional capital expenditure. In the last decade they've managed to keep our power bills to virtually the same amounts they were in 1989. All of which proves once again, that an asset is worth only as much as the people who use it. Over 40% of the production cost of cement is power. It quickly became clear to us that if we were to run a profitable company, wed need to keep power costs to the minimum. So we focused our efforts on improving efficiency at our kilns to get more output for less power. Next we set up a captive power plant at a substantially lower cost than the national grid. We sourced a cheaper and higher quality coal from South Africa. And a better furnace oil from the Middle East. The result is that today were in a position to sell our excess power to the local state government. Our sea-borne bulk cement transportation facilities meanwhile has brought many coastal markets within the easy reach. It has also made Ambuja India's largest exporter of cement consistently for the last five years.

Sector India is the second largest cement producer in the world. However, it is way behind China, where the capacity is more than five times larger. Cement is a low-value and high-volume commodity and is mainly concentrated near limestone deposits available in few States. It has a high rate of excise duty and accounts for 5% of total excise duty collection. During the Tenth Plan, cement production grew at a healthy CAGR of 8.67% while the installed capacity showed modest CAGR of 3.69%. Exports too showed an upward trend. Cement consumption has generally grown at 2%3% higher than growth of GDP. Keeping the past trends in view and taking into consideration the renewed emphasis on infrastructure, the cement industry can be expected to grow at about 11.5% corresponding to the GDP growth of 9%. The major raw material required is limestone gypsum, coal & power. India is having a huge deposit of limestone. But it is more important to know that in which region it is available. Limestone is the main raw material required for manufacturing cement. For manufacturing 1 tonne of cement 1.5 tonne of limestone is required, it is available across the country but the 70% concentration is in Andhra Pradesh, Karnataka, Gujarat, Rajasthan and Madhya Pradesh. Gypsum is another important material which is required along with clinker. Consumption of gypsum is around 5 to 8%. India has a

good availability of gypsum especially in the state of Rajasthan, Gujarat and Tamil Nadu. At present, 60% of coal requirement of the cement industry is met through linkages and fuel supply agreements, while the remaining requirement is met from open-market purchases, import, and use of petroleum coke. Most of the cement units have installed captive power generation capacities to the extent of 60% to 100% of their requirement. Ordinary Portland cement is currently used in the government/public sector for most of the construction activities.

Cement industry logs double-digit growth Chandan Kishore Kant / Mumbai Jan 23, 2012, 00:54 IST
The Indian cement industry is back on a double-digit growth trajectory. Reviving demand, especially in the northern and western markets, has helped companies post better sale volumes. The sector giants such as UltraTech, ACC, Ambuja, Shree Cement and JP Associates had robust sales in December. For the second month in a row, the nearly 300-million tonne industry posted 14 per cent growth (year-on-year) in despatches. It sold 19.78 mt against 17.35 mt during the same month in the previous year

Experts say it would help the industry do better this financial year against the earlier estimate of around five per cent growth. Executives had earlier told Business Standard that 2011-12 may see more or less the same growth witnessed in 2010-11. However, experts now say growth could be six to seven per cent, provided the January-March quarter maintains the momentum. It is the peak construction period. The sector, struggling till the beginning of the December quarter with growth a little above three per cent, has so far (April-December) clocked growth of 5.31 per cent. UltraTech Cement, part of the Aditya Birla Group, beat analysts expectation with Rs 619 crore as net profit during the quarter. According to K C Birla, chief financial officer, the northern and western markets saw surges in demand. Analysts said rural demand was reviving fast in Punjab, Haryana, Rajasthan, Gujarat and Maharashtra. The east showed revival signals, too, but could not beat the overall growth.

Interestingly, double-digit growth is being witnessed during months when all-India average cement prices were at an all-time high of Rs 280 for a 50-kg bag (though, these then declined by Rs 15-20 a bag in the later part of the quarter). In 2010-11, the industry reported the poorest growth in a decade, of less than five per cent. Currently, manufacturersbiggest concern is rising coal prices and sustainability of demand. The capacity target set for the 11th Five-Year Plan (2007-12) is already met. Companies added close to 120 mt during this period, with capital outlay of Rs 50,000 crore. However, on growth, the industry missed its 10-plus per cent annual target. After 2009, excess supply started taking a toll on the companies.

Top players

Cement companies off to buoyant start in New Year

Published on Thu, Feb 02, 2012 at 20:00 | Source : P Buoyancy on sales for the cement sector continued in the first month of the New Year as the manufacturers clocked up to 27% rise in sales on brisk construction and infrastructure activities. Among leading cement makers, Jaypee Cement's sales grew the highest at 27%, followed by ACC at 9% and Ambuja Cements by nearly 4% Jaypee Cement's sales grew to 1.96 million tonnes (MT) in January this year from 1.54 MT in January last year. ACC's sales grew to 2.23 MT in the month from 2.05 MT in the same month a year ago. Ambuja Cements' reported a little over 4% rise in sales at 1.91 MT over the same period last year.

"Cement volumes depend upon the real estate construction and infrastructure projects. The volumes in January reflect the accelerated activity on both the areas," an analyst said. Registering 5.9% growth, cement consumption of the country during the April-December period of the current fiscal stood at 160.3 MT over 151.4 MT in the corresponding period last fiscal. In December, India's cement consumption grew by 13.4% to 19.8 MT against 17.4 MT in the same month last year. However, despite double-digit growth in demand, average pan-India retail price of cement had dipped by around 1%month-on-month to Rs 285 per bag during December 2011. Meanwhile, commensurating with rise in sales, production of the cement makers also increased. ACC's production increased to 2.25 MT in January over 2.06 MT in the corresponding month last year. Ambuja Cements' production grew to 1.9 MT compared to 1.84 MT in the year ago period
Over 25-30% of the production cost of cement is power. It quickly became clear to us that if we were to run an iconic company, we needed to keep power costs to the minimum. So we focused our efforts on improving efficiency at our kilns to get more output for less power. Next we set up a captive power plant at a substantially lower cost than the national grid. We sourced higher quality coal from South Africa and better furnace oil from the Middle East.

At every step we found that new and innovative solutions could be found if we kept an open mind. The result is that today we are not only self-sufficient but are in a position to sell excess power capacity to the local state government. Our sea-borne bulk cement transportation facilities have meanwhile brought many coastal markets (domestic as well as export markets) within easy reach. This has been a major

factor in making Ambuja Cement India's largest exporter of cement - consistently for the last fifteen years. It can be done!

Cement Plants
Annual Capacity

Plant Capacity (mn tons)

Gujarat Himachal Pradesh/ Punjab Rajasthan Chhattisgarh/ West Bengal Maharashtra Uttar Pradesh 6.70 6.10 2.80 4.30 3.60 1.50

Port Terminal
Muldwarka, Gujarat: All weather port, 8 kms from our Ambujanagar 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 ferries bulk cement to the packaging units.

Bulk Cement Terminal

Surat : Bulk Cement Terminal with a storage capacity of 15,000 tonnes has bulk cement unloading facility. A Grinding unit has also become fully operational at this location. Panvel : Strategically located near India's biggest cement market, has a storage capacity of 17,500 tonnes and a bulk cement unloading facility. Cochin : The latest addition to our configuration of Bulk Cement Terminal