Cement Amit Gupta

8/4/2019 Cement Amit Gupta

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ENVIRONMENT SCANNINGREPORTONINDIAN CEMENT INDUSTRY


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INTRODUCTION

Cement is a crystalline

compound of calcium silicates

and other calcium compoundshaving hydraulic properties

(Macfadyen, 2006).


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History

Lime and clay have been used as cementingmaterial on constructions through many

centuries.

Romans are commonly given the credit for

the development of hydraulic cement, the mostsignificant incorporation of the Romans was

the use of pozzolan-lime cement by mixing

volcanic ash from the Mt. Vesuvius with lime.

Best know surviving example is the Pantheon

in Rome.

In 1824 Joseph Aspdin from England

invented the Portland cement.


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Hydraulic lime: Only used in specialized mortars. Made from calcination of

clay-rich limestones.

Natural cements: Misleadingly called Roman. It is made from argillaceous

limestones or interbedded limestone and clay or shale, with few raw materials.

Because they were found to be inferior to portland, most plants switched.

Portland cement: Artificial cement. Made by the mixing clinker with

gypsum in a 95:5 ratio.

Portland-limestone cements: Large amounts (6% to 35%) of ground

limestone have been added as a filler to a portland cement base.

Blended cements: Mix of portland cement with one or more SCM

(supplementary cemetitious materials) like pozzolanic additives.

Types of Cement


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Pozzolan-lime cements: Original Roman cements. Only asmall quantity is manufactured in the U.S. Mix of pozzolans withlime.

Masonry cements: Portland cement where other materialshave been added primarily to impart plasticity.

Aluminous cements: Limestone and bauxite are the main rawmaterials. Used for refractory applications (such as cementingfurnace bricks) and certain applications where rapid hardening isrequired. It is more expensive than Portland. There is only one

producing facility in the U.S. White Cement: White cement is basically OPC - clinker usingfuel oil (instead of coal) with an iron oxide content below 0.4 percent to ensure whiteness. A special cooling technique is used in itsproduction. It is used to enhance aesthetic value in tiles and flooring.White cement is much more expensive than grey cement.

Water Proof Cement: Water Proof Cement is similar to OPC,with a small portion of calcium stearate or non- saponifibale oil toimpart waterproofing properties.


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INDIAN CEMENT INDUSTRY


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HISTORY OF INDIAN CEMENT

INDUSTRY

In 1889 a Kolkata-based company started manufacturing cement from

Argillaceous.

Industry started getting the organized shape in the early 1900s.

In 1914, India Cement Company Ltd was established in Porbandar. with a capacity of 10,000 tons .

The World War I gave the first initial thrust to the cement industry in India

The industry started growing at a fast rate in terms of production,

manufacturing units, and installed capacity.

This stage was referred to as the Nascent Stage of Indian CementCompany.

In 1927, Concrete Association of India was set up to create public

awareness on the utility of cement as well as to propagate cement

consumption.


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ECONOMIC ENVIRONMENT


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IMPORTANT FACTS

India ranks second in world cement producingcountries.

The capacity, which was 29 mt in 1981-82, rose to219 mt at the end of FY09.

Contributes to environmental cleanliness byconsuming Hazardous wastes like :

Fly Ash (around 30 mt) from Thermal PowerPlants

Slag (8 mt) produced by Steel manufacturingunits.


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STATUS OF INDUSTRY

GDP contribution : 8%

% in world's market : 8%

Demand growing rate : 11%

Export : 6.02 million tonnes

Size of industry : 130 Plants

Output per annum : 217.80 Geographical Distribution: 54 major companies


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STRUCTURE OF INDUSTRY

Indian cement industry: 54 major cementcompanies

Major cement plants : 130 Plants

Total installed capacity : 236 mt

Production : 181.4 mt (2008-09)

Excise (Large Plants): Rs.350/tonne

All India reach through multiple plants

Export to : Bangladesh, Nepal, Sri Lanka, UAE


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Mini cement plants: 300 Plants

Total capacity : 200 tonnes Estimated capacity : 11.10 mtpa

Located in : Gujarat, Rajasthan & HP

Excise : Rs. 200 / tonne Presence : Limited to states

Technology : Vertical Kiln Technology

Infrastructure : not the best


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MAJOR PLAYER


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Company Production Installed Capacity Net Profits

(Lakh)

ACC 17,902 18,640 41,550.89

Ambuja 15,094 14,860 31,848

Ultratech 13,707 17,000 97,700

Grasim 14,649 14,115 1,64,800

Indian Cements 8,434 8,810 43,218

JK Group 6,174 6,680 14,234.40

Jaypee Group 6,316 6,531

Century 6,636 6,300

Madras Cements 4,550 5,470 49,081

Birla Corp. 5,150 5,113 9,061


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ACC Ltd.

ACC was formed in 1936

when ten existing cement companies came together under one umbrella in

a historic merger

Country's first notable merger at a time when the term mergers and

acquisitions was noteven coined.

STRENGTHS:

People ask for ACC, as it is having a good image and brand loyalty among

consumers.

Service is good

Perceived to be of very superior quality cement when compared to others

Selling form the very first day the shop came in to being & sells easily

They have same price prevailing for wholesale at dealers/stockiest

retailers end.


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Ambuja Cements Limited

Set up in the late 80s.

A decade later, it became one of worlds most efficientcement companies .

Today, Ambuja is the 3 rd largest cement company in India

Producing the finest cement in the world at the lowest cost.

Strengths :

Good quality product

Good packaging Strong distribution network

Advanced technologies

Eco-friendly


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The India Cements Ltd

Established in 1946

The first plant was setup at Sankarnagar in Tamilnadu in 1949 .

The Company is the largest producer of cement in South India.

The Company is the market leader with a market share of 28% inthe South .

The Company has a strong distribution network with over 10,000stockiest.

Strengths:

leading position in attractive Northern India grey cement market.

One of the Leading white cement producer in India

Proximity and access to large reserves of high quality limestone

Quality of products and strong brand name

Extensive marketing and distribution network


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UltraTech CEMENT

It has an annual capacity of 18.2 million tones. Ultratech Cement is the countrys largest exporter of cement clinker.

The export markets span countries around the Indian Ocean, Africa, Europe

and the Middle East.

Strengths:

Continuously improve productivity through quality, technology renewal

and customer focused operations.

To continuously seek quality enhancement in product, processes and

responses to various stakeholders.

To update management practices on a continuous basis and maintain a

culture of professional management.

To conserve, protect and enhance quality of life for our employees and

community.


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PRICE TRENDS

Cement prices have risen by : 5%

2% cut in excise duties, leads to down in price

in March.

Price rise in: Northern, Eastern and central

regions

Price fallen in: South & West regions


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Reasons of Price rise:

1. Taxes

2. High fuel cost

3. Increase in Demand

Reason of Price fall:

1.2% cut in excise

2.excess capacity

3. Mansoon


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PRODUCTION OF CEMENT

YEAR

(2001-09)

PRODUCTION

(IN MILLION TONNES)

2001-02 106.5

2002-03 111.8

2003-04 117

2004-05 125.3

2005-06 140.5

2006-07 154.7

2007-08 167.6

2008-09 181.4


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MERGER & ACQUISITION

Ultratech cement is going to absorb its sister concernSamrudhi cement to become biggest cement companyin India.

Worlds leading foreign funds like HSBC, ABN Amrofidelity. Emerging market fund and Assetsmanagement fund have together bought 7.5% 0f Indiacement (ICL) at cost of US $ 124.91 million.

Cimpor, a cement company of Portugal, has bought53.63% stake that Grasim industry had in ShreeDigvijay cement.


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French cement company vicat SA bought

6.67% share of Sagar cement at a cost of US $

14.35 million.

Holcim now hold 56% stake of Ambuja

cement.


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GROWTH

Cement Industry volumes grew by 1.7% YoY

to 18.5mt and FY11YTD (till Jan) volume

growth was 4.2% to 170mt.

ACC reported 17% YoY growth, benefiting

from the new capacities.

Ambuja reported 5% YoY growth

A.V.Birla group reported 4.4% YoY growth

JaiPrakash reported 32% YoY growth.


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PEST ANALYSIS OF CEMENT INDUSTRY

P : POLITICAL

E : ECONOMIC

S : SOCIAL

T : TECHNOLOGY

In 2002 the world production of cement was 1800

mmt. The top 3 producers were china with 704,India

with 100, US with 90mmt for a combined total ofabout half the world total.


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POLITICAL

The price of cement depends on coal rate, power

tariffs, railway tariffs,freight, royalty and cess on

limestone.

Government control all of these prices. Government is biggest consumer of cement in India.

Government offer fiscal incentives in form of sale tax

exemption.

Haryana offer a freeze on power tariff for 5 years.

Gujarat offers exemption from electric duty.


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ECONOMICAL

Currently the is on the boom

A lot of government infrastructure and

housing projects under construction.

Export segment of the industry is expected to

grow

Various outstanding cement plants coming up

in near future in the country.


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SOCIAL

Indian cement industry is consist of organizedand unorganized sector.

Organized sector: well known cement brands

Unorganized sector: local cement producers Indian consumers prefer buying branded cement.

Mini cement plants with low brand value are notable to survive against the cement giants.

Industry will create another 25 Lakhs jobs incoming years.


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TECHNOLOGY

Government plans to acquire new technologyfrom Japan.

Technology for Energy conservation &

environment protection To improve efficiency of Indian cement

industry.

At present 93% of total capacity in industry isbased on modern & eco friendly dry processtechnology.


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FUTURE PROJECTIONS

India is the second largest producer of cement inthe world after China.

Cement consumption is forecasted to grow by22%.

Expected increase in capacity by 50 mt in spite ofrecession

Experts projects 9-10% growth for currentfinancial year.

The housing sector accounts for 50% of demandsand this trend is expected to continue in nearfuture.


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FINANCIAL RATIOS

RATIOS 2007 2008 2009 2010

CURRENT RATIO 1.36 1.14 1.23 1.23

QUICK RATIO 0.09 0.58 0.60 0.60

CASH RATIO 0.36 0.62 0.58 0.62

INTERVAL MEASURE RATIO 93.6 90 99.28 79.2

DABT RATIO 0.33 0.28 0.29 0.28DEBT- EQUITY RATIO 0.75 0.61 0.59 0.53

CAPITAL EMPLOYED TO NETWORTH

RATIO

1.70 1.40 1.41 1.40

INTEREST COVERAGE RATIO 9.85 12.37 9.07 9.83

INVENTORY TURNOVER RATIO 8.87 8.04 7.56 7.51

DEBTOR TURNOVER RATIO 11.24 9.60 8.92 9.20

AVG. COLLECTION PERIOD 32.02 37.47 40.33 38.92

NET ASSETS TURNOVER RATIO 0.86 1.13 1.02 0.90


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EMPLOYMENT IN CEMENT

INDUSTRY

Indian cement industry employs a large number

of workforce which is over 1.5 lakhs persons.

Supports another 12 lakh persons indirectly.

According to the recent surveys, one metric ton

of cement generates job opportunities for around

14 lakh people.

In the year few years, more than 25 lakh peoplewill be employed in the cement companies.


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TECHNOLOGICAL ENVIRONMENT


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CEMENT MANUFACTURING

"Cement manufacturing is the basic

processing of selected and prepared

mineral raw materials to produce thesynthetic mineral mixture (clinker) that

can be ground to a powder having the

specific chemical composition andphysical properties of cement."

RAW MATERIALS


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RAW MATERIALS

The most common raw rock types used in

cement production are:

Limestone (supplies the bulk of the lime)

Clay, marl or shale (supplies the bulk of the

silica, alumina and ferric oxide)

Other supplementary materials such as sand,

pulverized fuel ash (PFA), or ironstone to

achieve the desired bulk composition


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NEW CEMENT BURNING TECHNIQUES

High efficiency in fuel choices.

Better thermal efficiency.

Low environment impact.

Superior changeover productivity.

Economical advantages.


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PERCEIVED BENEFITS OF TECHNOLOGY

UPGRADATION

It is envisaged that the technologyupgradation measures for the Pre-1990 eracement plants would result in :

Increase in capacity: 25-30 MTPA

Reduction in thermal energy consumption: 15-20 kcal/kg clinker

Reduction in electrical energy consumption: 5-10 units/t


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Reduction in cost of production of cement

by 5-10% because of above initiativesreduction in energy costs through co-

processing by 1015%

Reduction in the CO2 emissions: 20% (through blended cements & energy

conservation)


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FUTURE MODERNIZATION NEEDS OF

THE INDIAN CEMENT INDUSTRY

Appropriate pre-blending facilities for rawmaterials

Fully automatic process control and monitoringfacilities including auto samplers and controls.

Appropriate co-processing technologies for useof hazardous and non hazardous wastes

Interactive standard software expert packagesfor process and operation control with technicalconsultancy back-up

Energy efficient equipment for auxiliary/minoroperations


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Mechanized cement loading operations,palletization/shrink wrapping

Standards for making composite cement so thatall the fly ash and other industrial wastes viz.slag are fully used.

Co-generation of power through cost-effective

waste heat recovery system (only onedemonstration unit in operation)

Horizontal roller mills (Horo Mills) for raw

material and cement grinding Advanced computerized kiln control system

based on artificial intelligence


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FUEL REQUIREMENT AND

ALTERNATIVE SOURCE OF ENERGY

Fuel

Coal continues to be the main fuel for the Indiancement industry and will remain so in the near futureas well. The industry is mainly using coal from various

coalfields in the country. It is also procuring coalthrough open market and direct imports. Lignite fromdeposits in Gujarat and Rajasthan is also being used bycement plants. Pet coke has also been successfully

utilized by some cement plants, mainly in Gujarat,Rajasthan and MP, thereby substituting main fossil andconventional fuel coal upto 100% in some plants


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USE OF INDUSTRIAL WASTES

i) Cement plants in India utilized about 19% offlyash generated by power plants and 100% ofgranulated slag generated by steel plants, as

compared to almost 100% flyash and 84% ofgranulated slag in the Japanese cementindustry.

ii) Recycling of Industrial wastes in

manufacture of cement is highest in Japanfollowed by India.


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USE OF ALTERNATE FUELS

i) Use of hazardous and refuse derived combustiblesand Municipal Solid Waste (MSW) as fuel is common incountries like Canada, EU, Japan and Korea, butregulations do not yet permit in India.

ii) CPCB is actively engaged in plant level trials inrespect of wastes viz. used tyres, refinery sludge, paintsludge, Effluent Treatment Plant (ETP) sludge andToluene Di-Isocyanite (TDI) tar waste from petroleum

industries and in formulation of guidelines for use ofthese wastes as fuel by cement industry.


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ENERGY MANAGEMENT

The improvements in energy performance of cementplants in the recent past have been possible largely dueto :

Retrofitting and adoption of energy efficient

equipment Better operational control and Optimization

Upgradation of process control and instrumentationfacilities

Better monitoring and Management InformationSystem

Active participation of employees and their continuedexposure in energy conservation efforts etc.


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EMERGING TRENDS IN TECHNOLOGY

High degree of mechanization and capacity tohandle large volumes has lowered the run-of-mine

costs.

Detailed geological explorations and

technological advances.

A clearer understanding of structure and working

of limestones.

Balancing the economics.

Deploying large eathmoving equipment.

Technology has opened vistas for mining

engineers.


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Cont.

Technical and operational excellence for

survival.

Cement plants in our country have mostly

changed from the wet process to the energy

efficient dry process.

Out of 157 kilns, 117 are dry process based,

32 are based on wet process and 8 on semidry


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OPPORTUNITIES

The cement industry is going through its boomperiod with full capacity utilization. Powered

by the GDP growth of 8-9%, the annualdemand for cement in the country continuesto grow at 8- 10%. As per NCAER study, underhigh growth scenario, the demand for cement

(including exports) is expected to increase to244.82 million tonnes by 2010-11.


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POLITICAL ENVIRONMENT


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MEANING

The term is derived from the Greek terms

polis (city or state) and oikonomos (one who

manages a household).

Political environment consist of governmentpolicies and taxation policies which affects the

business.


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GOVERNMENT POLICIES

Government policies have affected the growth

of cement plants in India in various stages.

The control on cement for a long time and

then partial decontrol and then totaldecontrol have contributed to the gradual

opening up of the market for cement

producers.


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STAGES OF GROWTH

Price and Distribution Controls (1940-1981)

Partial Decontrol (1982-1988)

Total Decontrol (1989)


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GOVERNMENT CONTROL

The prices that primarily control the price of

cement are :

Coal

Power tariffs

Railway

Freight

Royalty and cess on limestone.

All of these prices are controlled by government


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ENVIRONMENT AGENCY REGULATION

Reduce consumption of natural resources Reduce the amount of cement process waste residues

disposed

Reduce emissions from cement manufacturing

Reduce emissions of greenhouse gases Optimize the sustainable use of wastes from other

industries

Develop site restoration plans and biodiversity action

plans Work to risk-based regulatory and environmental

management systems


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RULES & ORDERS

Cement Control Order, 1967

Cement Cess Rule, 1993

Cement (Quality Control) Order,1995

Cement (Quality Control) Order, 2003


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THRUST AREA FOR CEMENT DEMAND

The Government has identified the followingthrust areas for increasing its demand,namely:-

Housing development programmers

Promotion of concrete highways and roads

Use of ready-mix concrete in large

infrastructure projects Construction of concrete roads in rural areas

under Prime Ministers Gram Sadak Yojana.


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SOCIO CULTURAL

ENVIRONMENT


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Positive aspects of cement

industry Health

Controlling dust

Lorry emissions

Keeping it quit Using energy efficiently

Effective investment

Use of alternative fuels

Cement in concrete

Use of natural resources


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NEGATIVE ASPECTS OF CEMENT INDUSTRY

Runny eye ,excess mucous in nose ,and throat,coughing

Shortness of breath , difficulty breathing with orwithout exertion

Lower work capacity ,tiredness , muscle soreness Lung cancer

Pulmonary tuberculosis infection

Right heart enlargement and /or failure ,cardiacarrest,

Kidney cancer


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Impact on health Skin contact

Eye contact

Inhalation


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SUMMARY

Cement is an essential component ofinfrastructure development.

Origin : 1914 in Porbandar with capacity of1000tonnes.

2nd largest cement producer

Total capacity 151.2 million tonnes

130 large & 300 small cement plants at present

Contribute 8% to Indias total GDP

Export : 6.02 million tonnes


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PRESENTED BY:-

AMIT GUPTA

ASHISH CHAUHAN

ACHLA


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THANK YOU..

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Cement Amit Gupta