UltraTech Cement is India's largest cement company with a production capacity of 63.1 million tonnes per year. It has integrated plants, grinding units, and bulk terminals across India. The document discusses UltraTech's mission, production processes, costs, pricing strategy, and future plans to expand its market leadership in India's growing cement industry. It analyzes how government deregulation impacted growth and competition in the oligopolistic cement market. UltraTech aims to lower costs and increase exports to maintain competitiveness against other major cement producers in India.

1. ULTRA TECH CEMENT
A MicroeconomicsAnalysis
MGT 502:Economic Analysis for Business Decisions (EABD)
GROUP 10: Cherranjivi R, Hriday Bora, Subhasni Jaiswal,Ayushi Gupta,JunaidAli,
Phanindra Reddy

2. AGENDA
 Introduction
 Government role in cement industry
 Mission, vision & values
 Demand & supply
 Production
 Cost of production
 Pricing strategy
 Market structure
 Future plan & scope
 Conclusion

3. INTRODUCTION
“ What you build will last forever
Build beautiful.”
 UltraTech cement was started in the year 1983 at Awarpur cement plant I by Aditya Birla Group of industry
 UltraTech cement parent industry was Grasim industry
 UltraTech cement has the 63.1 million tonnes per annum production capacity FY 2014-15
 They went to public on 2000
 In India it has 12 grinding plants , 12 integrated plants and 5 bulk terminal
 Its headquarters is in Mumbai
Key Contributor: Ayushi Gupta

4. GOVERNMENT ROLE
 COMPLETE GOVERNMENT CONTROL
The every cement industry should follow the government regulated price from the year 1956 - 1982.This period
was starting base of growth of 6.6%.The growth rate was very slow and sharp.The entry of new player was limited
because returns on investment was limited.
 PARTIAL GOVERNMENT CONTROL
This was from the year 1982 - 1989.To trigger growth in the industry and support emerging Indian infrastructure.
The partial deregulation was required two third of all sales to government .The companies were free to sell in open
market at ceiling price .The growth rate was increased to 8.2%.
 FREE CEMENT MARKET
This was at 1989 were all price and distribution control was withdrawn.The industry deregulated by 1991 the result
in massive expansion of cement capacity.The time at which the country was at slow pace of urbanization and the
market was at which Indian company took jump start
Key Contributor: Ayushi Gupta

5. MISSION,VISION &VALUES
MISSION
To deliver superior value to our customers, shareholders, employees and society at large.
VISION
"To actively contribute to the social and economic development of the communities in which we
operate. In so doing, build a better, sustainable way of life for the weaker sections of society and
raise the country's human development index.“
VALUES
Integrity, Commitment, Seamlessness, Passion & speed
Key Contributor:Subhasni Jaiswal

6. DEMAND & SUPPLY
Today the second largest producer of cement in the world is India after China.
 The consumption of cement is expected to increase gradually as the government focuses on
infrastructure development.
 Cement has become a important raw material in today’s world which is used in housing,
commercial and infrastructure development.
 In our country the demand of cement is more compared to production capacity due to
globalization.
 The UltraTech cement demand start from government project such as building bridges ,road ,
railway and irrigation.Their demand come form policy such as home for every Indian .Where the
government provide subsidies for citizen.
Key Contributor:Chiranjeevi R.

7. DEMAND & SUPPLY
 When the demand of UltraTech cement is high the company use the capacity to produce to
maximum to cover the demand when the demand for cement is low they reduce the production
of cement.
 Since 2008 the real-estate in our country is booming the cement demand is growing.When there
is recession in US market the demand of real-estate was falling in our country where the
stagnation of cement took place.
 The cement industry play a key role in development of country by providing residential and
infrastructure for the people in the country.
 The supply of UltraTech cement has been increased from year after year where the company
increase their reach to customer and increased capacity of cement production.
Key Contributor:Chiranjeevi R.

8. MARKET STRUCTURE
COMPETITION FOR MARKET SHARE
 Companies – Ambuja Cement, ACC, J.K. Cement, Dalmiya
Bharat, India cements
oMarket structure is an oligopoly market
oUltraTech has a share of 22% of production of total’s India’s
cement production
oIt’s a free entry & free exit where the cost of capital is too
high like in Dec 23,2014 Jaypee sold two MP cement units to
UltraTech for Rs. 5,400 crore
Key Contributor:Hriday Pratim Bora

9. PRODUCTION
 UltraTech cement has 11 integrated plants, 1 white cement
plant, 12 grinding units in India.
 The key raw material are Limestone, Clay , Sand and Coal.
 There are 32 short run of industry from 1983
 The UltraTech cement produce various product such as
Ordinary Portland cement, Portland blast furnace slag cement,
Portland Pozzolana cement & Concrete
 The UltraTech cement required huge amount power to produce
cement where 80% is satisfied by them
 They produce 63.1 MillionTon Per Annum
 The company's subsidiaries are Dakshin Cements Limited,
Harish Cements Limited, UltraTech Cement Lanka (Pvt.) Ltd and
UltraTech Cement Middle East Investments Limited
Key Contributor:Hriday Pratim Bora

10. COST OF PRODUCTION
 Cost of Production of UltraTech cement depends on two cost.
Fixed cost is capital for a plant of grinding or mix unit and
machine.Variable cost for them are raw material, labour ,power
and repair in the industry.
 The cost of production play a key role for UltraTech cement to
increase profit by minimizing cost of production.
 This play a competitive advantage for UltraTech cement to
competition on pricing .
0.00
5,000.00
10,000.00
15,000.00
20,000.00
25,000.00
30,000.00
35,000.00
40,000.00
45,000.00
1 2 3 4 5 6 7
Total Fixed cost
Total Variable Cost
Total Cost
Key Contributor:Zunaid Ali

11. PRICING STRATEGY
 UltraTech cement being India's largest producer of cement they play “Price Leadership”
 Price leadership in which the dominant player fix a price and competitor follow the price
 Here the UltraTech can play a huge game by lowering price the competitor in market can
reduce in numbers. It mainly depend on the cost of production and market share of the
company
 They reduce the distance to market and have the optimum use of rail, road and sea
transportation
 Increase in the use of pet coke gives them a cost advantage
Key Contributor:Zunaid Ali

12. FUTURE PLANS & SCOPE
Plans & scopes for future growth includes:
 Cost Leadership
 Rising exports
 Retail stores
 Relationship management
 Synergies with Grasim
 Ready mix concrete
 Setting up new plants
Key Contributor:Phanindra Reddy

13. CONCLUSIONS
The cement consumption in our country is increasing where we are the fastest growing economy
country after china. It identified its strengths and problem areas through a variety of tools.While
its raw material sourcing, financial and human resource pools are sources of competitive
advantage, UltraTech has to improve in terms of fuel costs in order to beat ACC, Ambuja Cement,
Jaypee to the top position in the low margin industry.This can also be achieved by leveraging
futuristic trends like branded retailing, exports and new products like ready concrete mix.
UltraTech company is really performing well and it really has vast scope to grow and become the
world’s leading cement manufacturer company.
Key Contributor:Phanindra Reddy