1. An Environmental
Scanning Report On
Cement Industry
Presented to- Professor Gurpartap Singh
Presented by- Tania Goel
Roll No- 1331878

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. 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. 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. 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. 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. Economic Environment covering
details of impact of Macro
Economic Factors on the Ambuja
Cement Ltd.

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. 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. 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. 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. 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. 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. Macro Economic
Factors affecting
Cement Industry

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. 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. 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. 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. 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. THANK YOU !