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AN END-TO-END SECONDARY ANALYSIS OF THE GLOBAL CEMENT INDUSTRY;

REGION FOCUS: INDIA

1. BACKDROP

Concrete is second only to water as the most consumed

substance on Earth, with nearly one ton of the material
used annually for each person on the planet. Cement is the
critical ingredient in concretethe glue which locks
together the sand and gravel in an inert mixture.
Cement is a global commodity, manufactured at thousands
of local plants and although the industry is consolidating
globally. However, large, international firms account for
only 30% of the worldwide market.
The global Portland cement market is Expected to
Reach USD 5,165.1 Million Tons by 2020. The
following graphic depicts the expected growth patterns*:
BRICS nationsBrazil, Russia, India, China and
South Africaare also some of the fastest growing
economies of the world, and thus have a huge potential for
generating a very lucrative, unprecedented demand to
accompany infrastructural, industrial and residential
needs*. The demand for portland cement mainly stems
from the growing construction activities across the globe.
Brazil and Russia will host international tournaments
such as Olympic Games and FIFA World Cup in 2016
and 2018 respectively. Such massive events require world-
class infrastructure development in the form of stadiums
and other ancillary amenities. In preparation for the FIFA
World Cup in 2018, the Russian government has allocated
approximately USD 16 billion to developing essential
infrastructure. These factors are expected to drive the
In many developed countries, the cement market growth is demand for cement in Russia and Brazil in the next few
slow or nil whereas in developing markets, growth rates years.
are more rapid. Asia Pacific accounted for about 65.0% of
The South Asian regions economy will expand by a real
the total portland cement market in 2013, followed by NA
6 percent in FY 15 and by 6.4 percent in FY 16
and EU. APAC is expected to be the fastest growing
compared to 5.4 percent this year, potentially making it
regional market in terms of both portland cement
the second fastest growing region in the world after East
consumption and production. Growing urbanization in
Asia and the Pacific. The Indian economy which currently
Asia Pacific has led to increased demand for housing
accounts for 80 percent of the regions output, is set to
and infrastructure development which has led to
grow by 6.4 percent in fiscal year (FY) 2015/16 after 5.6
increased demand for Portland cement in this region.
percent in FY 2014/15.**
Countries such as China and India are expected to be the
The outlook over the next years for South Asia indicates
major drivers for Portland cement in the near future. These
broad economic stability and a pick-up in growth with
countries are expected to invest in infrastructure
potential risks concentrated on the fiscal and structural
development in order to build basic infrastructure
reform side Martin Rama, Chief Economist for South
facilities. These investments are anticipated to boost the
Asia at the World Bank
demand for Portland cement in this region*

.* According to the CIAs World Factbook **According to an October 6, 2014 forecast by the World Bank
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AN END-TO-END SECONDARY ANALYSIS OF THE GLOBAL CEMENT INDUSTRY;
REGION FOCUS: INDIA

Stringent environmental guidelines are to pose a big As evident from the above analysis, real estate is the key
challenge to the growth of the cement industry. As such a demand driver for cement in India and around 64% of the
sustainable, eco-friendly packaging of world-class cement gets used for housing construction. Continuous
standards, along with other pro-environment measures will migration from rural to urban areas, rising income levels, a
go a long way in addressing the issue. decrease in the household size on account of growing
trend of nuclear families has led to a significant increase in
2. SCOPE AND OBJECTIVES real estate activity.
Infrastructure sector (roads, power, airports, urban
infrastructure, railways etc.) is the second biggest
To analyze the cement industry in India in terms of the
consumer with a 17% off-take.
industry structure.
The Indian cement industry is weakly oligopolistic in
To study the demand-supply factors with appropriate
nature on a national leveltop 12-13 firms amongst 100
statistical data, and the aggregation or segregation of
firms capturing 70% of the cement market as evident from
cement markets across India. Understand overall
the following graphic which depicts the major players of
opportunity by determining market size for cement
the Indian cement sector during FY 11-12.
industries.
Market information and competition analysis of the Indian
Birla Corp Ltd. OCL India
cement industry. 2.1% Ltd.
Penna Cement 1.5%
Industries Binani Cement
2.7 2.4%
3. RESEARCH METHODOLOGY
Lafarge India
ACC Ltd
2.8%
Kesoram 12%
This report has been developed using analytical, Industries
3%
descriptive and comparative methodologies, utilizing Century
Cements
Minitab as the chief statistical tool. 3%
Grasim
Industries
Highly reliable, relevant and fresh data have been used Chettinad 11%
Cements
from the Centre of Monitoring Indian Economy 3.96%
(CMIE) databases, data from annual reports of the Dalmia Cements
4% Ultra Tech
companies observed, and data from Cement Cement Ltd.
Manufacturers Association (CMA) database. Shri Cement
10%
5%
Ambuja
4. INDIAN CEMENT INDUSTRY STRUCTURE: Cement
Jaypee Ltd.
A BRIEF MARKET LANDSCAPE Madras Cements
Ltd. India Cement 10%
5.25% cements Ltd.
J.K. Group 6% 7%
5.4%
India is the second largest cement producing country in
the world. The major demand drivers for cement in India
are best illustrated via an application segment analysis of
The following table offers a company-wise, exhaustive
the Cement Market as shown below:
database of cement companies in India. The entries
have been listed in a descending order of annual installed
production capacity in terms of million metric ton per
annum (MMTPA).

*** Data source: Cement Manufacturers Association of India

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AN END-TO-END SECONDARY ANALYSIS OF THE GLOBAL CEMENT INDUSTRY;
REGION FOCUS: INDIA
Annual
No. of Installed
Company Plant Locations
Plants Capacity
(MMTPA)
Chaibasa, Chanda, Jamul, Kymore, Lakheri, Thondebhavi, Madukkarai,
ACC ltd Sindri, Wadi, Gagal I and II, Damodar Cement Works, Tikaria (G), Wadi New, 16 27
Bargarh Cement Works, Kudithini
Rajshree- Malkhed, Rajashree-Hotgi (G), Vikram Cement, Aditya Cement I &
II, Grasim Cement Raipur, Grasim South, Grasim-Bhatinda (G), Grasim Dadri
Grasim Industries 11 25.65
(G), Grasim Panipat (G)
Grasim Cement-Kotputli, Grasim Cement-Aligarh(G)
Ultra Tech-ACW, Ultra Tech-JCW (G), Ultra Tech-HCW, Ultra Tech Gujarat,
Ultra Tech Cement Ltd Ultra Tech-APCW I & II, Jafrabad, Magdalla (G),Ratnagiri (G), Ultra Tech- 11 23
ARCW(G), Ultra Tech-WBCW (G), Ultra Tech-Ginigera (G)
Ambuja Cement, Gajambuja Cement, Ambuja Cement-Himachal Pradesh
(2), Ambuja Cement Ropar (G), Ambuja Cement Rabriyawas, Ambuja
Ambuja Cements Ltd Cement-Bhatinda (G), Maratha Cement; Ambuja Cement Roorkee (G), 13 22
Ambuja Cement Bhatapara, Ambuja Cement Sankrail (G);Ambuja Cement
Magdella (G); Ambuja Cement Farakka (G)
Jaypee Rewa, Jaypee Bela, Jaypee Sadva Khurd (G), Jaypee Ayodhya
(G),Bhilai (Clinker), Dalla, Chunar (G), Jaypee Panipat (G), Jaypee Sidhi,
Jaypee Cement Ltd 14 17.15
JaypeeKutch, Jaypee Wanakbori (G), Jaypee Roorkee(G), Jaypee Bagheri,
Jaypee Baga
Sankarnagar, Sankaridurg, Chilamkur Works, Dalavoi, Visaka Cement,
India Cements 9 14.05
Yerraguntla, Raasi Cement, Vallur(G), Parli(G)
Shree Digvijay-Sikka, Khyber Inds. (P) Ltd, Prism Cement, Lemos Cement,
Kistna, Bagalkot Cement & Ind. Ltd, J&K Ltd, Kalyanpur Cement,KCP Ltd,
Others 16 13.37
Mawmluh Cherra, Panyam Cements, Sone Valley, Meghalaya Cements Ltd,
Shriram Cements, Sanghi Industries Ltd, My Home Industries.
Nimbahera, Mangrol, Gotan, Muddapur, Lakshmi Cement, Lakshmi Cement
J.K. Group 7 13.17
Kalol (G), J.K Udaipur Udyog
Ramasamyraja Nagar, Jayantipuram, Alathiyur Works I & II,
Madras Cements 7 12.72
AriyalurUthiramerur(G), Salem(G), Kolaghat(G)
Shri Cement Shri - Beawar, Ras, Khushkhera(G), Suratgarh(G), Roorkee(G) 5 12
Dalmia Cements Dalmia-Dalmiapuram, Dalmia-Kadapa, Dalmia - Ariyalu 3 9
Chettinad Cement Chettinad-Karur, Chettinad Karikkali, Chettinad-Ariyalur 3 8.2
Century Textiles Century Cements, Maihar Cement, Manikgarh Cement 3 7.8
Kesoram Industries Kesoram Cement, Vasvadatta Cement 2 7.25
Lafarge India (P) Ltd Arasmeta, Sonadih, Jojobera (G), Mejia (G) 4 6.55
Penna Tadippatri I & II, Penna Ganeshpahad, Penna-Boyareddypalli Ltd,
Penna Cement Industries 4 6.5
Penna -Tandur
Binani Cement Binani Cement Sirohi, Binani Cement Sikar (G) 2 6.25
Birla Vikas & Satna, Birla Cement & Chanderia, Durgapur (G), Rae Bareli,
Birla Corp Ltd. 5 5.78
Durga Hitech (G),
OCL India Ltd OCL India-Rajgangpur, OCL India-Kapilas (G) 2 5.35
Orient Paper Industries Orient Cement, Orient Cement-Jalgaon (G) 2 5
Rain Comdt. Ltd Rain Comdt. Unit I, Rain Comdt. Unit LN-1, Rain Comdt. Unit LN-2 3 4

*** Data source: Cement Manufacturers Association of India

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AN END-TO-END SECONDARY ANALYSIS OF THE GLOBAL CEMENT INDUSTRY;
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Adilabad, Akaltara, Bokajan, Charkhi-Dadri, Kurkunta, Mandhar, Neemuch,

CCI Ltd 10 3.85
Rajban,Tandur, Delhi (G)
Zuari Cement Ltd Zuari Cement, Sri Vishnu Cemen 2 3.4
Heidelberg Cement(I) Ltd HCIL - Ammansandra, Damoh, Jhansi (G), Dolvi ( 4 3.1
Mehta Group Saurashtra Cement, Gujarat Sidhee Cement 2 2.7
Mangalam Cement Mangalam Cement, Neer Shree Cement 2 2
Andhra Cements Vizag (G), Nadikude- Durga Cement 2 1.42
Cement Manu. Co. Ltd Cement Manu. Co. Ltd, Megha T&E (P) Ltd (G 2 1.06
Tamil Nadu Cement Alangulam, Ariyalur 2 0.9
HMP Cements Ltd Porbandar, Shahabad 2 0.67
Malabar Cements Malabar Cements, Malabar Cements (G) 2 0.62
Grand Total 172 270.77

5. MARKET SEGMENTATION

The cement industry in India is fragmented into five
different regions because of the hindrance in long-distance
transportation owing to the bulky nature of cement and
limestone, and the high freight costs involved in
transportation of these commodities.
cement produced in 2012, out of a total of more than
15 companies.
The major players in the north zone are Shri
Cements Ltd, Ambuja Cement Ltd., ACC Ltd.,
Ultratech Cement Ltd., JK Lakshmi Cement Ltd.
and Jaiprakash Associates Ltd.
Over the last decade the top 5 or 6 companies have
captured over 75% production of cement as
instanced below:

WEST-ZONE

NORTH-ZONE
The top four companies in terms of cement
production in west zone produced 73% of the total
The top five companies in terms of cement
cement produced in 2012, out of a total of 15
production in north zone produced 77% of the total
companies.

*** Data source: Cement Manufacturers Association of India

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AN END-TO-END SECONDARY ANALYSIS OF THE GLOBAL CEMENT INDUSTRY;
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Major players are Ambuja Cement Ltd., Ultratech
Cement Ltd., Sanghi Industries Ltd., Century
Textiles & Inds. Ltd., and Jaiprakash Associates
Ltd.
CENTRAL-ZONE
SOUTH-ZONE
The top three companies in terms of cement
production in central zone produced 70% of the total
cement produced in 2011, out of a total of at-least 8
companies,
Major players are Jaiprakash Associates Ltd.,
ACC Ltd., Century Textiles & Inds. Ltd., and
Ultratech Cement Ltd.
Over the last 6 years, the top 4 companies have
captured around 80% production of cement,
EAST-ZONE
The top four companies in terms of cement
production in east zone produced 81% of the total
cement produced in 2011, out of a total of 17
companies.
*** Data source: Cement Manufacturers Association of India
Major players are Lafarge India Pvt. Ltd.,
Ultratech Cement Ltd., OCL India Ltd., ACC
Ltd., Ambuja Cements Ltd., and Century Textiles
& Inds. Ltd.
Over the last 6 years, the top 5 companies have
captured around 75% production of cement.
The top 7 companies in terms of cement production
in south zone produced 74% of the total cement
produced in south zone 2011, out of a total of 25
companies.
Major players are India Cements Ltd., Ultratech
Cement Ltd., Madras Cements Ltd., ACC Ltd.,
Ambuja Cement Ltd., Kesoram Industries Ltd.,
Dalmia Bharat Sugar & Inds. Ltd., Chettinad
Cement Corpn. Ltd., and Penna Cement Inds.
Ltd.
Over the last 6 years, the top 8 companies have
captured around 75%-80% production of cement.
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AN END-TO-END SECONDARY ANALYSIS OF THE GLOBAL CEMENT INDUSTRY;
REGION FOCUS: INDIA

6. MARKET OPINION
The market shows a steady movement from Site Mix
Cement (SMC) to Ready Mix Cement (RMC), owing to
the higher thrust on quality and safety norms in
construction combined with greater emphasis on timely
completion of projects.
The demand for RMC increased by 25% during FY 07-
08 to FY 11-12 CAGR, reaching 63 million cu m.
This robust growth was driven by healthy growth in
infrastructure investment, real estate construction coupled
with rising penetration of RMC usage in these segments.
In response to this strong growth in demand, RMC
capacity has also grown by 20% during the same period.
Research expects RMC demand growth to remain healthy,
primarily led by real estate and well supported by
infrastructure and industrial construction sector.
Stringency of recent environmental guidelines poses a
serious challenge to growth, owing to the innately
effluent-heavy nature of the cement industry. As such,
usage of environment-friendly, sustainable packaging,
coupled with other pro-environment measures will go a
long way in balancing growth with environmental
stability.

*** Data source: Cement Manufacturers Association of India