Introduction to Ambuja Cement Ltd.

1. - Gunjan Rathod (133)
- Pavan Rathod (134)
- Hardik Rawal (135)

2. Introduction
• GACL was established as ACPL in 1981 by
Narotam Satyanarayan Sekhsaria
• Factors
1. Stable demand
2. lack of substitute
3. limited competition
• Suresh Neotia was appointed as Chairman &
Sekhsaria was managing director.

3. ACPL(1981)
Gujambuja cements(1983)
Ambuja Cements Himachal ltd.(1995)
Wholly owned subsidiary(Mauritius & Srilanka)(1995)
Guj line-2(1996)
Ropar(Punjab) & Panvel (Maharashtra) (1996)
Modi cements (1997)
Nadikudi & Proddatur (1998)
Delhi based DLF (1999)

4. GACL- State wise Plant Capacity(in million tonnes)
State Capacity
Gujarat 4.00
Himachal Pradesh/Punjab 3.00
Rajasthan 1.5
Chhattisgarh/West Bengal 2.00
Maharashtra 2.00
• Energy efficient and technologically advanced(1990)
• In December 2001 GACL began production in Chandrapur.
Statistic

5. Information
• GACL had larger distribution- 11,500 outlets.
• Brand building
Competitive Advantages of GACL
• Use of better quality Limestone
• Innovative energy management efforts
• Strong retail presence in Mumbai, Gujarat and
Punjab

6. Market Share in %
Grasim-L&T
Combime
GACL-ACC
JK Group
India Cements
Madras Cements
22%
5%5%
Indian Cement industry-Companies and their Market share(%) in 20
24%
5%
36%

7. Questions for Discussion:
1. Study the evolution of GACL from a small start-up to a cement major
over the years. How far do you think the company’s success can be
attributed to its project location, design and implementation
decisions?
2. “GACL’s cost management focus was the biggest factor responsible for its
success.” Critically comment on the above statement and examine the
company’s approach to cost reduction and productivity enhancement. How
did this approach help it gain a competitive advantage and emerge as a
leader in that commoditised industry?
3. Do you think that GACL’s efforts were more driven by market
compulsions than a strategic cost focus? Will GACL be able to sustain its
superior performance in the years to come? Give reasons to support your
stand?

8. Working hard towards
Operational Excellence
• Locating plants in backward area
• Units in Gujarat, Himachal Pradesh
and Punjab
• Setting up unit in Himachal Pradesh
• Plant at Chandrapur
• Empowerment to engineers
• Ordering machines

9. Use of Modern Technology
• Surface miner
• Japanese method
• Modifying kiln
• Installed a centrally operated computerized
process control system
• 40 days continuous work
• Pollution control equipment's

10. Questions for Discussion:
1. Study the evolution of GACL from a small start-up to a cement major
over the years. How far do you think the company’s success can be
attributed to its project location, design and implementation
decisions?
2. “GACL’s cost management focus was the biggest factor responsible for its
success.” Critically comment on the above statement and examine the
company’s approach to cost reduction and productivity enhancement. How
did this approach help it gain a competitive advantage and emerge as a
leader in that commoditised industry?
3. Do you think that GACL’s efforts were more driven by market
compulsions than a strategic cost focus? Will GACL be able to sustain its
superior performance in the years to come? Give reasons to support your
stand?

11. Cost Cutting
 Power
• Setup of fuel based captive power plants in
Gujarat and Himachal Pradesh in 1998
• Selling extra power generated
• Small measures reduced GACL’s power
consumptions from 120 units/tonne of
cement to 88-90 units/tonne of cement

12. Cost cutting
 Fuel
• Import cheaper higher quality coal from
South Africa
• Use of groundnut husk instead of coal.
Overall coal consumption reduce by 3%
• Replacement of V belt drives to flat belt
drives.

13. Cost cutting
 Freight
• Developing Sea route
• Set up of modern ports & freight
handling terminals at Muldwarka, Surat
and Panvel
• Cost of transporting cement in Mumbai
by road worked out be 1800 per tonne
and 400 per tonne by sea.
• GACL saved roughly 180 million
annually.

14. • Smart
• Out of the box thinking
• Being self-sufficient
• Time management
Will it be able to sustain its superior
performance in the years to come?

15. WHAT WE LEARN FROM THIS
CASE STUDY
• Showing trust in employees
• Never give up in any situation
• Grabbing every opportunity coming your way
• Adopting new methods to save time and money
• Being sensitive towards nature