Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

An environmental scanning report on ambuja cements

2,739 views

Published on

An environmental scanning report on ambuja cements

Published in: Business
  • Login to see the comments

An environmental scanning report on ambuja cements

  1. 1. An Environmental Scanning Report On Cement Industry Presented to- Professor Gurpartap Singh Presented by- Tania Goel Roll No- 1331878
  2. 2. Cement industry- Overview • Today, the Indian cement industry is very large, second only to China in terms of installed capacity, and has grown at a very fast pace in recent years. The rate of growth over the past 20 years has been phenomenal, Since 1992 India's cement production has more than quadrupled from around 50Mt/yr to 220Mt/yr in 2011. • Although the Indian cement industry has some multinational cement giants, like Holcim and Lafarge, which have interests such as ACC, Ambuja Cement and Lafarge Birla Cement, the Indian cement industry is broadly home-grown.
  3. 3. Major Players • The major domestic cement companies in India include Ultratech Cement, Ambuja Cement, JK Cements, ACC Cement, Century Cements, India Cements, Sanghi Cements, Dalmia Cements, Saurashtra Cements and Madras Cements. • With booming cement demand in India and abroad, many foreign cement players are also establishing and expanding their presence in India. The world’s top cement companies are present in India, namely France's Lafarge, Holcim from Switzerland. • Holcim, one of the largest global cement industry players, has established its presence in India by buying a major stake in two established brands of ACC and Ambuja Cements. Collectively, these companies have the largest market share in India, close to 50% of the total market size.
  4. 4. Policy and Promotion Some of the policy measures adopted by the Indian government to support and aid the growth of the Indian cement industry include the following: • No custom duty on non-coking coal: In Budget 2012-13, the government has exempted non-coking coal, one of the main raw materials for cement production, from basic customs duty (earlier at 5%). This will have a positive impact of 1-1.5% on the cement industry’s operating.
  5. 5. Market share of major participants • Cement and Lafarge Birla Cement, the Indian cement industry is broadly home-grown. Ultratech Cement, the country's largest firm in terms of cement capacity, holds around 22% of the domestic market, with ACC (50%-owned by Holcim) and Ambuja (50%-owned by Holcim) having 15% and 13% shares respectively. • Many of the remaining dozen top players are Indian and are (in order of diminishing market share); Jaiprakash Associates (10%), The India Cements Ltd (7%), Shree Cements (6%), Century Textiles and Industries (5%), Madras Cements (5%), Lafarge (5%), Birla Cement (4%) and Binani Cement (4%). • Between them the top 12 cement firms have around 70% of the domestic market. Around 100 smaller players produce and grind cement on a wide range of scales but are often confined to small areas
  6. 6. About Ambuja Cement Ltd. • The Company’s first plant was set up at Ambuja Nagar in the State of Gujarat. The commercial production of its first plant with an installed capacity of 0.70mn tonnes was started in the year 1986. In the last two decades the Company has grown from a single plant single location Company to a multi location entity with an installed capacity of 13.3mn tonnes. • Ambuja Cements Limited was earlier known as Gujarat Ambuja Cements Limited (GACL). The company was set up in 1986. In this short span Ambuja Cements has achieved massive growth and presently, the total cement capacity of the company is 16 million tonnes.
  7. 7. Economic Environment covering details of impact of Macro Economic Factors on the Ambuja Cement Ltd.
  8. 8. ECONOMIC ENVIRONMENTAL FACTORS • Its financial statements i.e balance sheet and profit and loss, profits are increasing every year and its share price is also high as compared to other cement industries and its assets are also increased. It means that its financial position is very strong as compared to others. • From here we can analysis that its profits are increasing year by year and it means that they are providing more to GPI,with this our NPI will also be increase and overall position of country will be better. • From here we can analysis that if industry position is strong then our country’s position will also be strong. • It means it is beneficial for the people and country.
  9. 9. SOCIAL ENVIRONMENTAL FACTORS • This particular company is totally different from. On this case they really helped by doing lot of social work like they putt off various health centers for the poor people and provide Monetary help also to some reason. • They also helped by providing education facilities to poor people like books etc. • Not only this they are also providing good quality products that doesn’t harm any kind of injuries to the people while they are using it. • The Company strives to provide a safe and healthy work environment for its employees and to avoid adverse impact and injury to the environment and communities in which the company conducts its business. The commitment is reflected in the number of awards the Company has received including National Award for outstanding pollution control. • The awareness and training programme on health and safety related issues should be conducted regularly. All the employees, and directors shall comply with all applicable laws and regulations relating to health and safety so as to ensure healthy and safe work environment. Using or being under the influence of illegal drugs and alcohol on the job is absolutely prohibited.
  10. 10. LEGAL ENVIRONMENTAL FACTORS • Ambuja cements is most recognized unit in India and they always they are following proper rules and regulations that are made by central government and also follows that are mentioned in the Company’s ACT 1947 regarding Safety, Health and Social needs. • They should Endeavour to keep abreast of the developments in laws and regulations and comply with the same. If any one gets to know of any non compliance of any of the laws in his or her colleagues area of operation in the company the same is brought to his/her immediate notice as well to the notice of his/her Head of the Department. • All Directors and Employees of the Company conduct business affairs with honesty and integrity and in full compliance with all applicable laws, rules and regulations and shall not commit any illegal or unethical act or instruct others to do so, for any reason.
  11. 11. POLITICAL ENVIRONMENTAL FACTORS • Its political environmental is totally different from others because they never put any kind of political pressure on any other whether it is against or in favor for them. They always try to follow the proper rules and regulations that are made by the central government. • But still they have to change their strategies as per change in the political environment. • This policy applies solely to the Company and is not intended to discourage or prevent individual Director or Employee from making political contributions or engaging in political activities on their own behalf. • No personal political contribution is reimbursed by the Company. No personal political activities should interfere with duties to be discharged with the Company in line with this Code of Conduct.
  12. 12. TECHNOLOGY ENVIRONMENTAL FACTORS • It is one of the most important factor as compared to others. In this particular we are going to discuss that what type of technology they are using and how much beneficial for them as well as for the people who are using this particular product. • Ambuja cements industry is having good quality machines to make their products and also they are using latest technology machines. And their technology is very effective that is implemented and they also implanted modern technology like Inventory Control system etc
  13. 13. ENVIRONMENTAL SCANNING REPORT OF AMBUJA CEMENTS • Environmental scanning is often defined as the acquirement and usage of information from the organization’s external environment. In the present day, the external environment could not be completely ignored because of the volatility of the environment and scanning identifies an organization’s potential threats and opportunities. The external environment of an organization includes all the external factors which could influence the decision making process. The external environment varies for differing organizations and is usually dependent on the organization size and industry. • As above I have already explain each and every environmental factor and it shows us how external environmental factors effect Ambuja Cement industry.
  14. 14. Macro Economic Factors affecting Cement Industry
  15. 15. Political Factors affecting Cement Industry • The price of cement is primarily controlled by the coal rates, power tariffs, railway tariffs, freight, royalty and cess on limestone. Interestingly, government controls all of these prices. • Government is also one of the biggest consumers of the cement in the country. • Govt. of India plans to increase its investment in infrastructure to US $ 1 trillion in the TwelfthFive Year Plan (2012-17) will lead to increase in the demand of cement. • Infrastructure projects such as the dedicated freight corridors, upgraded new airports and ports are expected to enhance the scale of economic activity, leading to a substantial increase in cement demand furthermore. • Most state governments, in order to attract investments in their respective states, offer Fiscal incentives in the form of sales tax exemptions/deferrals. States like Haryana offer a freeze on power tariff for 5 years, while Gujarat offers exemption from electric duty. • Strict law & order conditions and political will of the leader of any state enhance theconfidence of people living in the states as well as corporate to invest in that particular state. • The total Government levies and taxes , which include Royalty on Limestone, Royalty on Coal,Electricity Duty, VAT/Sales Tax etc.,on cement constitute about 60% or more of the ex-factoryprice of cement.
  16. 16. Economic Factors affecting Cement Industry • Currently, the industry is on the boom, with a lot of government infrastructure and housing projects under construction. In spite of seeing a fall during 2008-09, the export segment of the industry is expected to grow again on account of various infrastructure projects that are being taken up all over the world and numerous outstanding cement plants coming up in near future in the country. • Over time more sophisticated and refined methodologies in connection with longer time series were employed to study productivity change. The contribution of total factor productivity to output growth was of primary interest to explain the continuously low economic development. • During that time, labor productivity as well as capital availability and use increased considerably, while the overall growth rate of the economy stagnated at low levels. • Concerned about the efficiency of resource use researchers started investigating productivity growth and input factor substitutions for aggregate manufacturing as well as various industries
  17. 17. Social Factors affecting Cement Industry • Usually, the cement industry in India consists of both the organized sector and the unorganized sector. • Organized sector comprises of the well-known cement manufacturing companies while the main players of the unorganized sector are the regional and local cement-producing units in various states across the state. • Indian consumers prefer buying branded cement like ULTRATECH, JAYPEE CEMENT, LAFARGE CEMENT etc. • It has been seen in the past, as well, that mini cement plants with low brand value and image are not able to survive against the cement giants. • With a population of more than 100 billion people, it is expected that cement industry will create another 25 lakhs jobs in the next 4-5 years.
  18. 18. Technological Factors affecting Cement Industry • From mining to production the entire process depends on technology. • The Government of India plans to study and possibly acquire new technologies from the cement industry of Japan. • The government is discussing technology transfer in the field of energy conservation and environment protection to help improve efficiency of the Indian cement industry. • At present 93% of the total capacity in the industry is based on modern and environment-friendly 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 utilizing 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. • Also, some cement plants have set up dedicated jetties for promoting bulk transportation and export.
  19. 19. International Factors affecting Cement Industry • With the rapid growth rate of the Indian economy after the 1990s, the infrastructural developments within the country has been tremendous. • The increase in the construction activities has led to the increase in the demand for updated quality building materials and other allied products. • Cement being one of the major elements in the construction work, there is a growth in the cement industry in India. The consumption of cement has increased in India by nearly 7.5%. • With the globalization of Indian cement industry many foreign cement manufacturers are engaging themselves in agreements and deals with their India counter parts to have a share of the growth. • Large cement players in India will use the acquisition route to enhance capacity and market share. It is clear that smaller plants will not survive in the long term. The top five players will hold 70-80 % of capacities and market in the next decade. • There is an expectation that more global players would come into India as they would like to get a foothold in the market as the demand will propel in the emerging economies. • Acquisition appears a good route primarily because a Greenfield cement plant takes 3-4 years to build and another 3-4 years to break even at an operating level of even 70-75 %. E.g.:- The acquisition of the Larsen & Toubro cement (ULTRATECH CEMENT LIMITED) business by Grasim Industries Limited in 2003-04 is a case in point.
  20. 20. THANK YOU !

×