Vaibhav Dixit

B.Com(H)IIYear
2017-18

REGIONAL COLLEGE
OF PROFESSIONAL STUDIES & RESEARCH
Affiliated to MJP Rohilkhand University, Bareilly

Pilibhit Bypass, BAREILLY (UP)

PROJECT ON

LAFARGE CEMENT
(TITLE OF PROJECT)

(LOGO OF PROJECT COMPANY)

2016-2017

SUBMITTED BY:

VAIBHAV DIXIT

B.COM. (HONOURS) – II Year.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18

REGIONAL COLLEGE
OF PROFESSIONAL STUDIES & RESEARCH
Affiliated to MJP Rohilkhand University, Bareilly
Pilibhit Bypass, BAREILLY (UP)

CERTIFICATE
THIS IS TO CERTIFY THAT THE PROJECT TITLED

“LAFARGE CEMENT”
(Title of Project)
HAS BEEN PREPARED BY

VAIBHAV DIXIT
AS PER REQUIREMENT OF CURRICULUM OF B.COM. (HONOURS)- II Year.
THIS WORK IS AS PER GUIDELINES LAID OUT FOR THE SAME AND IS WORTHY OF APPROVAL.

Signature of Panel of Teachers

Dr. Anjali Chaudhary
Dr. Priya Verma
Miss Surya Lata
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B.Com(H)IIYear
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REGIONAL COLLEGE
OF PROFESSIONAL STUDIES & RESEARCH
Affiliated to MJP Rohilkhand University, Bareilly

Pilibhit Bypass, BAREILLY (UP)

ACKNOWLEDGEMENT
I AM EXTREMELY THANKFUL TO ALL THOSE WHO HAVE HELPED ME IN COMPLETION OF MY

PROJECT TITLED

“LAFARGE CEMENT”.

MY PROJECT WOULD NOT HAVE COMPLETED WITHOUT THE ENCOURAGEMENT, GUIDANCE

AND MOTIVATION PROVIDED TO ME BY Dr. Anjali Chaudhary, Dr. Priya Verma and
Miss Surya Lata mam. LASTLY, I WOULD THANK ALMIGHTY GOD FOR GIVING ME
COURAGE, WILL AND INTELLIGENCE TO COMPLETE THIS WORK.

VAIBHAV DIXIT

B.Com. (Hons)

II Year
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B.Com(H)IIYear
2017-18
EXECUTIVE SUMMARY
Private banking is a concept which is new and fast emerging in the world of banking where

changes have become a necessity in order for banks to survive in this competitive environment

vis-à-vis not only from the public and private sector banks but also from the foreign banks. The

objective of the research is to explore the various products, which a private banker deals into

and the systematic process involved to match client requirements with the right kind of

product.

Through this research one of the main objectives is to explore the reason why most of the

banks are injecting private banking as business profile to their set of service offerings.

Though private banking evolved in late 80’s in Asia, in India its not more than 5 years old. ICICI

started it in Aug 2002 and since then it has been a remarkable success. Today there are

enormous solutions to cater client needs but what suits best to a client is where private banking

fits in. Every client will have different needs, liking and preferences. So a customized portfolio

for every client is the need of the day.

This research will highlight more on the product portfolio of ICICI Private Banking, how they

have changed or innovatively structured to be attractive and competitive.

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B.Com(H)IIYear
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CHAPTER 1

RESEARCH METHODOLOGY
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RESEARCH METHODOLOGY

Type of Research-
We have conducted descriptive research through surveys and collected data through Personal
Interviews and Formal Questionnaire.

Sampling
For any research to be effective, useful and relevant the sample population to be surveyed
needs to be determined very carefully keeping in mind the capacity of the sample to be able to
represent the population in effect. The two most important things to keep in mind are:

 The sample size becomes very important in this case.

 Also the demographic distribution of the population should be covered by the sample
distribution.

The sample population was carefully distributed across the Delhi area keeping in
mind the local demographics. The survey was conducted in west and north Delhi. All the areas
within the sample population were surveyed.

The 3 stages of survey:

1- The first stage of analysis was done to find out the potentials of putty as a substitute to
Plaster Of Paris, the buyer’s perception about the product, the awareness level of the User
about the benefits of putty, the opportunity for putty at institutional sites.

2- The second stage of analysis was done to find out the key person who takes the decisions
regarding the uses of products and to influence his perception regarding Wall Putty.

3- In the third stage the Painters were surveyed to find out their perception as the painters
are major influencers in the buyer’s decision making process.
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A few end consumers were also interviewed to find out their attitude and awareness about the
product and the different brand offerings.

A sizeable number of end customers and builders have formed a part of the research sample
population as well.
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CHAPTER 2

INTRODUCTION
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B.Com(H)IIYear
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INTRODUCTION

In 1999 Lafarge, number one producer of building materials in the world

reorganizes into five business divisions and decentralizes a number of HQ
functions and roles. As Director Learning & Development, I was asked to develop
a vision and strategy for Learning, build an organization to support that vision and
facilitate ‘Learning and Development interventions’ throughout the organization.

Due to an intensive program of recent acquisitions there was a need to pull the 60
business units (countries) together and develop an overall vision, strategy and
processes in several major areas as technology, finance, HR, management
practices, etc…

From the beginning we excluded a ‘corporate university’ type of approach, with

large catalogues of central training programs. Our vision on learning and
development was based on ‘learning from experience’, maximize involvement,
learning embedded in the managerial processes, learning as the result of working
together (social constructivism), etc… Our aim was to build a ‘learning
organization’.

In line with that vision on learning, we wanted to shape an L&D organization that
was able to drive the ‘learning organization’. This L&D organization was based on
three pillars:

 In each unit a L&D manager. He/she consults management on learning &

organizational development and facilitates learning interventions in his/her
unit
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 The network of unit L&D managers. A vehicle to develop vision, strategy
and skills on learning, facilitation and process consulting & share
experiences

 A small central L&D team to support the network provides leadership and
consults the L&D managers in the units. We deliberately kept this team
small (5 people in an organization of 85.000) to avoid the team from taking
over and killing involvement of network members.

OBJECTIVES

The L&D network was a crucial instrument in developing a vision on learning,

where managers and teams were drivers of their own development, based on the
collective reflection on their work reality and experience. We tried to position the
network as the driver for organizational learning in Lafarge. The main objectives
of our work with / as network were:

 Developing a common vision & values on learning and development from

which each BU could derive its own business related learning strategy

 Creating a platform and energy to implement the vision on learning and

development in all BU’s

 Developing and distributing company wide tools and methodology for

learning (coaching, intervision, instructional design processes, …)

 Developing the competencies of the L&D community (internal consulting,

process interventions, instructional design, facilitation, change
management.)

 Involving newly acquired businesses and give new L&D managers a chance
to contribute rapidly to the Learning and Development community and
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allow them to have a ‘jump start’ in their new position fueled by
experiences, tools, methodology, … from colleagues in the network.

 Sharing experiences and knowledge between BU’s : learn from diversity in

the network

A CONTEXT FOR COLLABORATION

The fact that the ‘L&D function’ still had to be created within the Cement Division,
was an opportunity to ‘mark the difference’ from what happened before and
create a ‘new context’ for the L&D managers in the units in terms of :

 Vision, strategy and interventions on learning and development

 Their own role and responsibility

 The ‘attitude’ and ‘role’ of the central Learning & Development team
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 The working relations in between unit L&D managers
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From the start we created ‘direction’ by clearly stating the main elements of
Lafarge’s vision on learning & development and communicated our changed
vision and expectations on the role of unit L&D Managers.

But at the same time we offered our ‘help and assistance’ as central L&D team to
help unit L&D managers to cope not only with those changed expectations but
also with the operational demands coming from their local management.

COLLABORATIVE STRATEGIES

In order to really create a ‘network’ that is capable of building a common vision

and implementing a companywide global strategy, you need more than a few
‘network meetings’. We needed a ‘common practice’ throughout the L&D
community. We deployed four strategies to make that happen, which we
presented as ‘levers for learning’ for the organization.

Those levers were seen as ways to create a common identity for the approach
and intervention of learning throughout the organization irrespective of where
the intervention originated: locally in the units or as a central initiative.

1. COMMON TOOLS, METHODOLOGIES AND PROCESSES

The network becomes real through the common use of a number of tools,
methodologies and processes. Some of these were proposed by the central team,
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Some of them were collectively developed as an initiative of the network, or
could be a ‘unit L&D tool’ shared through the network with all other units. A few
examples:

 A methodology for needs analysis and contracting with internal customers

 Coaching methodology and tools (coaching guide)

 Instructional materials and workshop design for implementing the new

performance management process

 An intranet with several functions as: share good practices, post materials,
tools, etc. for sharing, open up local / central training programs for
enrollment from other units.
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2. L&D NETWORK ACTIVITIES

The network becomes a reality also, through the actual meeting, discussing,
sharing and working together ‘in the flesh’. Every six months we convened as a
network. These network activities were not ‘congress’ type of activities but were
shaped as ‘learning organizations’ in itself, where we tried to ‘live’ the vision on
learning and development in the organization. A few examples of activities and
methodologies:

 Project work (developing tools, materials, designs, etc… for use throughout
the organization)
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 Intervision (to learn from each other, but also to live the methodology in
order to use it in the units)

 Experiential games and activities

 Role play and simulations (ex : internal consulting, needs analysis, …)

 Share and present local initiatives, experiences with others

 Brainstorm, mind map, … (to translate vision on learning into effective

interventions)

 Regional meetings to coordinate and collaborate on ‘regional level’

 Individual coaching and feedback

 Workshops on specific skills for L&D managers (sometimes specifically

geared to new members / new methodology, or to introduce a new
initiative.)

3. INTERNAL CONSULTANCY PRACTICE

Designing a consulting practice, was seen as a lever to engage the organization in

their reflection on learning and development and supporting management in
driving learning in the organization. It was seen as an opportunity for the central
team to actually work with the business unit managers and at the same time to
create a common practice with the L&D managers from the network.
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We developed four areas of consulting:

 Accompanying (process) major project, change efforts, improvement

initiatives in the Organization, like implementing companywide
‘performance improvement programs, support integration of newly
acquired business, implement new safety culture and practices, etc…

 Helping networking communities within the organization to develop an

effective Collaborative process

 Supporting local interventions with specific instructional expertise around

coaching, training design, needs analysis methodology, intervision,
developing job-aids, etc…

 Advising HR and L&D managers in the units on how to develop a learning

culture in their organizations

By always associating the BU L&D manager to the consulting work done in his unit
by the central L&D team we manage to :

 Accompany new appointed L&D managers in taking their role as ‘process

consultant’ in the organization

 Boost their confidence in their new role as L&D managers (very different
from the logistic and administrative role they had before)

 Build their credibility with their local business management

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 Develop a common and consistent OD consulting practice throughout the
organization

 To build an internal customer relationship with business management

4. COMPANY WIDE INTERVENTIONS

As fourth lever, we introduced a limited number of worldwide ‘development

tracks’ for several reasons:
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 They served as examples of experiential instructional design for the L&D
community.

 They offered an opportunity to work with the L&D unit managers on

projects for the organization as a whole (not only their unit)

We avoided positioning those programs as ‘central programs’ by:

 Having them organized by a ‘host L&D manager’ in a unit inviting

participants from all other units.

 Using local faculty from that unit, giving a clear signal that everybody can
learn from everybody in this organization.

It was amazing to see how the simple fact of ‘trusting’ local L&D managers and
faculty, to deliver a companywide program, created enthusiasm and sense of
belonging to the ‘L&D community’.

To create and maintain their energy to ‘uphold’ these companywide programs we

made sure we limited the number of programs and focused on common needs
and target groups. We needed ‘projects’ that were priorities for all units in order
for people to put their efforts in and not consider it as ‘extra work’ or something
they were forced into. We focused on:

 Development of new plant engineers

 Development of newly appointed plant managers

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 Development of newly appointed team leaders

 Development of ‘technical consultants’ in the Technical Centers

CRITICAL SUCCESS FACTORS

After five years of working with that network, with hindsight, I would list the
following elements as success factors :

 Create ongoing opportunities for network members to actually ‘work with

each other’, have experiences in common so they have something to share,
to embrace, to care for during the meetings.

 Clear leadership and direction from the beginning and then build gradually
to a more shared leadership

 Give guidance and leadership in terms of ‘vision’ and process, but avoid
creating a ‘semi hierarchical’ relationship. Make sure network members do
not perceive the central team as ‘controllers’, making sure the ‘central
policies’ are well implemented. But to the contrary, position the leadership
as ‘consulting support’ for issues and difficulties the L&D managers
encounter in their businesses.

 Don’t build the ‘collaborative work’ only from the needs of corporate
headquarters. Make sure that the individual members and their respective
businesses see direct added value for them, in the different projects you
launch.

 Make sure ‘network activities’ are integrated fully in the local priorities of
people. Network members will not have the support of their local hierarchy
if their effort in the network is not crucial for the local business and a
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priority for the hierarchy. It will be seen as ‘extra work’ as a sort of ‘hobby’
and therefore will not be sustainable.

 Communicate and work where possible also with the ‘bosses’ of the
network members (in this case the Unit HR Directors)

 The design of the network activities and the way you ‘lead’ the process
needs to be in line with the vision on learning and development: very
experiential, participative, open and confronting, supportive.

 As central team, or corporate L&D director, do not work with Unit business
managers, without fully involving the unit L&D manager. Otherwise you
alienate the unit L&D manager from his/her own internal customers and
hurt him in his/her credibility as internal consultant towards unit
management.

 This network was in the first place about work, but it only worked because
we developed a real interest in each other as persons and colleagues and
took our time during our activities to invest in each other personally (room
for really meeting each other).

ACTIVITY PROPOSED TO YOU DURING ‘MOPAN’ CONFERENCE

 TESTIMONY: introduction to the reality of the L&D network in Lafarge, with

examples of projects, activities, methodology we used, etc…

 BE NETWORK: An intervision session where people can ‘tap into each

other’s experience’ and work together on issues they have in their network.
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 SHARE LESSONS LEARNED: Brainstorm around two or three major ‘Issues’
like conditions for productiveness, shared leadership, deal with diversity
and share my perspective on that from the Lafarge experience.
COACHING AS THE DRIVER FOR LEARNING
Introducing coaching practices to develop engineers in the Cement Division

A Good Practice.

CONTEXT

Through acquisitions and with the steady growth of the Lafarge business, a lot of
new engineers are entering the Cement Division every year. The danger is that
the development of these new engineers is not properly looked after and that it
takes 2 to 3 years before they can really contribute to the business. It becomes
necessary therefore, to ensure that their development is well managed, and that
they contribute greatly towards the continued performance of the Lafarge
business.

CHALLENGE

The challenge for the Division therefore, is to ensure that this employee
population is worldwide developed in a structured way, fast and in line with the
business needs, in order that they quickly become effective, become autonomous
and take up responsibility very early in their careers.

Keeping in mind also the vast differences in the business units, in resources,
competencies and technological advancement, it is also necessary to ensure that
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every engineer, regardless of location, is exposed to the same challenges and
given the same basics and foundation on cement manufacturing. Early exposure
to the Lafarge know-how, databases and benchmarking becomes very key to all
new engineers in this respect in order that they develop and are aware of Lafarge
best practices.

SOLUTION

The solution was to create a formalized coaching track for all the newly hired
plant engineers. The objective was that the direct bosses would become coaches :
set challenging objectives, question and follow up on a regular basis and give
feedback in order to improve behaviors and competencies that they see as being
ineffective. Help engineers to learn and share on-the-job.

“Coaching as a driver for learning” was introduced for the plant engineers through
the Cement Professionals Development track. One of the strengths of the track is
that it is flexible and adaptable to the local needs. The main emphasis of this track
is the experiential learning philosophy, which largely encourages learning by
doing.

The track is in 4 phases, the Explored, a 2 week Training-Session (the only phase
to take place outside the job) and the Dig-in and Take-off phases. (See graph)
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Together with the implementation of this program, it was necessary to ensure

that each business unit took real ownership for the program in terms of following
up the coaching process, on-the-job learning and adapting the program to suit
local conditions. The divisional Learning and Development team, prepared the
unit L&D

Managers supported them in launching the program in their units and created a
number of tools to support the coaching practice.

EFFECT

Since the program was launched in 2000, up to 250 participants have gone
through the program, which has involved between 90-95% of the total units in the
Cement Division. The end result is that more than 50% of the coaches changed
their management style since they started coaching and a lot of coachees feel a
lot more
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autonomy and responsibility in their functions. Heard in a recent survey from the
coaches and coachees:

 Coach: “Because I have more frequent contacts with my coachee, I know

him better. I see what my coachee needs to develop and can give him step
by step bigger tasks. I know what he is able to do and that makes me feel
more comfortable in delegating tasks.”

 Coachee: “Coming fresh from university I had no idea of what I was able to
do and didn’t feel comfortable in doing things on my own. I discovered
however my competencies and that I could always find a solution on my
own, because my coach was never instructing me what to do. By
questioning he let me find solutions myself, that made me more self-
confident.”

 Coach: “I develop my coachee, but at the same time he develops me by

giving me feedback and telling me his experiences. Together we bring each
other up to a higher level.”
77% of the coaches say their coachees were autonomous faster and more than
50% of the coachees feel they were integrated faster into their jobs.

We still encounter difficulties with coaching here and there, because coaching is
not easy, it requires great investments of commitment and time, but for 80% of
the coaches who are coaching today within the Cement Professionals
development Program, it has become ‘the way to manage’.
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CHAPTER 3

ORGANIZATION STRUCTURE
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ORGANIZATION STRUCTURE
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CHAPTER 4

PRODUCT RANGE
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A world leader in cement, Lafarge has designed a diversified product range intended for
construction professionals.

A rich and varied range

Lafarge cements are designed to respond to the requirements of all of the Group's
customers. Its broad range of products is suitable for industrial players, individual
customers and architects:

 Portland cements: high-quality basic building materials that are both

efficient and versatile.
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 Cements for different types of environments: products suitable for
exposure to sea water, sulfates and other aggressive environments.

 Special cements for specific applications: including white cements for

architectural projects, cements for well drilling operations, cements
containing silica fume or fly ash, pozzolan cements, and cements for road
surfacing that incorporate slag and hydraulic binders.

 Cements for masonry and mortars for concrete blocks, tiles, rendering,
stucco, etc.

These different cements can all be used to produce concretes with a variety of
characteristics and properties.
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White cements

To achieve architectural and aesthetic projects that make cities more beautiful, our
white cements are a perfect solution. Based on advanced technology, they can produce
white precast concrete for urban furniture, flooring or structural elements, but also white
or colored mortar that give character to the facades of houses and buildings.

White cement is a hydraulic binder whose physical characteristics correspond to those

of Portland grey cement. It is distinguished by its pure white color. This whiteness is
the result of nature, as well as the rigorous selection of raw materials used in
manufacturing and a technologically advanced production process.

The light and luminous color of Lafarge white cements makes them particularly well
suited to uses where appearance is of prime importance. For example, they are
used to manufacture white or colored mortars which cover the façades of private
homes and multi-storey buildings.

Lafarge white cements are also used in the composition of white cement concrete. This
can be used to create all shapes and colors and is highly prized by architects and
urban planners. It is used in precast elements such as:

 architectonic concrete,

 internal or external floor coverings,

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 façade elements,

 street and garden furniture,

 the construction of swimming pools.

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Lower carbon cements

Cements with less clinker and less CO2 emissions, but with high level mechanical
performance and great workability: this is the combination provided by our lower carbon
footprint cements. Not to mention they also improve the long-term strength of concrete
for constructions, buildings and infrastructure that last longer!

All around the world, Lafarge offers ranges of cements with lower
CO2 emissions compared with traditional cements. These multi-component cements
contain less clinker, whose production is responsible for a large proportion of cement's
carbon footprint. As a substitute, they incorporate by-products from other
industries, such as slag from steel production or fly ash from coal-fired power plants.

Lafarge lower carbon cements also have high mechanical performances, often
combined with specific workability qualities. When incorporated into concretes, they
improve their long-term resistance compared with that of traditional concretes.

They can be used in all types of constructions and infrastructure including large
structures with very specific requirements, such as:

 stadiums,

 bridges & footbridges,

 dams,
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 skyscrapers.
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CHAPTER 5

PLANT LOCATION
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PLANT LOCATION
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CHAPTER 6

MARKET SHARE
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MARKET SHARE OF ICICI BANK

There are 10-odd suitors for Lafarge India’s 11-million tonne (mt) capacity cement business.

This has to be sold, says the Competition Commission of India (CCI), if it is to allow the merger

of the French giant with Switzerland-based Holcim as far as operations in this country.Lafarge

India’s cement business is estimated to be valued at Rs 10,000 crore. The bidding criteria could

change — the Competition Appellate Tribunal (Compat) will be scrutinising the CCI order, after
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Dalmia Cement’s appeal against it.CCI had approved the merger for a second time, in February,

after Lafarge had told the regulator it would sell the entire firm. However, Compat issued a stay

order on the merger last week; it did so without hearing CCI, which it has given three weeks to

respond. Dalmia Cement had appealed to Compat earlier this month, arguing the “terms and

condition for divestment in the main order have been wrongly incorporated in the impugned

order”.Dalmia Cement was referring to the threshold on operational capacity in the eastern

region that CCI had set for bidders of Lafarge’s 5.15 mt business in Chhattisgarh and Jharkhand

in its first order, issued in March 2015. Lafarge India has a total capacity of 7.8 mt in the eastern

region and of this, 5.15 mt was originally considered by the CCI for divestment to complete the

global merger. Holcim’s ACC and Ambuja, respectively, have 6.1 mt and 4.6 mt capacity in the

region.Cement is considered to be a regional product by the anti-trust regulator, as its

transportation beyond a distance doesn’t make economic sense. Hence, the CCI considered the

divestment of 5.15 mt capacity of Lafarge sufficient to avoid an 'appreciably adverse effect on

competition' (AAEC).

For the same purpose it also put a restriction that the eligible bidder should not have

operational capacity which is more than five per cent of the total installed capacity in the

region. Which comprises the four states of Bihar, Jharkhand, Odisha and Chhattisgarh, with an

aggregate capacity of 45 mt.Birla Corp first emerged as the most eligible suitor and successfully

won the bid for 5.15 mt asset. However, the deal fell through as the mining rights for limestone

reserves catering to these plants could not be transferred, due to a recentamendment in the

Mines and Minerals (Regulation and Development) Act. The amendment prohibited transfer of
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mining rights in case of an asset sale.Lafarge then sent a revised proposal, to sell the entire

business of close to 11 mt -- about 7.8 mt capacity in the eastern region and another three mt

in the north. While CCI approved the complete sell-off in an order this February, it continued

with the of five per cent market share threshold for the bidders that it had set in its first order,

issued in March 2015.Dalmia Cement has questioned in its appeal whether CCI has taken into

account “the facts specific to the alternative proposal and assessed whether the alternative

proposal adequately eliminates AAEC”.“The cement industry is seeing a lot of consolidation and

the market dynamics might quickly change. If Compat directs CCI to look at the deal afresh, it

might reconsider the five per cent market share restriction,” says Karan Singh Chandhiok,

partner at law agency Chandhiok & Associates. “Moreover, LafargeHolcim might support such a

move, as it means more bidders for its assets.”Adds H M Bangur, managing director at Shree

Cement, “We will also bid for it if the five per cent threshold is brought down. But, we'd prefer

to go by the rules than take the route of a legal battle.”Dalmia Cement did not reply to Business

Standard's queries, saying the matter was sub judice. Dalmia and Shree Cement have about 20

per cent and 10 per cent market share, respectively, in the region.

HOW IT ALL UNFOLDED

April 2014 Lafarge and Holcim announce global merger

July 2014 Lafarge and Holcim notify CCI about merger

March 2015 CCI orders Lafarge to sell 5.15 mt in East region

 Vaibhav Dixit
B.Com(H)IIYear
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August 2015 Birla Corp wins bid for Lafarge Asset for Rs 5,000 crore

December 2015 Deal with Birla Corp falls through as mining rights not transferred

January 2016 Lafarge submits proposal to sell entire business of 11 MT

February 2016 CCI approves this with keeping same criteria that it set for first bid

April 2016 10 bidders submit their bid for Lafarge 11 mt business

April 2016 Dalmia Cement gets interim stay from Compat on sell off

May 2016 COMPAT will hear CCI on this

CHAPTER 7
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
MARKETING STRATEGIES
 Vaibhav Dixit
B.Com(H)IIYear
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MARKETING STRATEGIES

Lafarge is the market‐leader in cement manufacturer and holds top‐ranking positions in

aggregates and concrete.

Whilst cement and concrete manufacturers have communicated sustainability at a generic level

for some time, Lafarge realised that they had a genuine story to tell which addressed industry

issues. It was essential that Lafarge did more than simply talk about their ‘green credentials’;

Lafarge was determined to prove their worth through a focused marketing campaign based on

genuine successes in the areas of reducing CO2, reducing waste and responsible sourcing.

Lafarge wanted to demonstrate to customers and prospects that it is continually improving its

sustainability achievements. Lafarge Cement adopts a three level strategy to drive sustainable

consumption in the marketplace and within the company:

• CO2 reduction

• Waste reduction

• Responsible Sourcing
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
Although Lafarge had numerous strong, tangible and unique sustainability achievements and

messages in these three areas, communicating them in an engaging way represented a

challenge due to the sheer volume of sustainability communications in the industry.

Lafarge supported the SustainableTM campaign with an innovative product launch (Cemergi®),

and developed a product positioned to satisfy the market’s need for sustainable building

materials. Through improvements to internal processes and developing, launching and

promoting sustainable offers for the market Lafarge Cement have reduced total CO2 emissions

by 1.9 Mt CO2 between 2007‐2011. This is the equivalent of taking 660,000 cars off the road for

a year.

Company Background Lafarge has been a major player in the UK construction sector since

entering the British market in 1987. Today, Lafarge is the market‐leader in cement and holds

top‐ranking positions in aggregates and concrete.

Challenges and Opportunities

Whilst cement manufacturers have communicated sustainability at a generic level for some

time, Lafarge realised that they had a genuine story to tell which addressed the issues raised by

the policies. And it was more than simply presenting a positive image; it was also about

communicating their growing success at producing and providing genuine sustainability.

However, it was essential that they did more than simply talk about their ‘green’ credentials to

the wider‐world; they were determined to prove their worth through a focused marketing

campaign based on genuine successes.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18
Using sustainability as a catalyst for change, Lafarge continually review and update their

production processes. Including the development of a product positioned to satisfy the

market’s need for sustainable building materials, called Cemergi®. It is the lowest CO2

embodied cement available for construction in Great Britain. Competitors do not have an

equivalent product.

Objectives

• To demonstrate to customers and prospects that Lafarge Cement is continually improving its

sustainability achievements in every possible area, at every possible opportunity, to benefit

their customers and the environment.

• Increase Lafarge Cement’s Sustainability image.

• Increase penetration, sales and market share of Cemergi® from pre‐launch to launch.

• Increase awareness of Cemergi® and its attributes and benefits.

Three level Strategy

Lafarge Cement adopts a three level strategy to drive sustainable consumption in the

marketplace and within the company:

• CO2 reduction
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
• Waste reduction

• Responsible Sourcing

CO2 Reduction

Lafarge produces both Packed (in bags) and Bulk (higher quantities e.g. lorry loads) cement

offers for different target end user sectors and segments. Over the last five years significant

CO2 reductions in both the packed and bulk cement offers have been achieved:

In the Packed sector, the cement range comprises of two main products (General Purpose

Cement and Mastercrete) with a further four specialist products completing the range. GPC and

Mastercrete represent over 95% of cement sales by volume and from 2006 through 2010, they

were both reengineered to contain approximately 20% less CO2, whilst still providing

customers and end users with the same value proposition as previously, but with the

sustainability benefits of lower CO2.

In the Bulk sector, two lower CO2 cements (Portland Limestone Cement and Phoenix) and a

newly launched product, Cemergi® have provided the marketplace with a lower CO2. PLC has

approximately 20% less CO2 and Phoenix has approximately 30% less CO2. The new and

innovative Cemergi® cement has approximately 45% less CO2 making it the lowest CO2

embodied cement manufactured and available in the United Kingdom.

The success of these three products in the marketplace has meant they have moved from

representing 13.8% of the Lafarge cement product mix in 2008 to 34% in 2011 so over one third
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
of the entire bulk sales are in lower CO2 cements. This gives even more indication of the

demands for sustainable building materials in the modern day marketplace. When looking at

the whole Lafarge Cement product range, the lower CO2 cements have been increasing within

the product mix year‐on year since their launch and in 2011 represented over half of all product

sales.

The combined effect of these new and re‐engineered products and their success in the

marketplace mean that over 1.1 Mt of CO2 has been saved between 2007‐2011 meaning on

average over 200,000 tonnes of CO2 per year has been saved. To put that into context, 200,000

tonnes of CO2 per year is the equivalent of taking 70,000 average petrol cars off the road per

year.

Waste Reduction

Lafarge Cement has been active in utilising waste materials as an alternative fuel i.e. recycled

waste tyres and as alternative materials within the production process. This sustainable

approach has reduced the amount of material going to landfill as well as reducing CO2

produced (50% reduction in construction site waste to landfill – 2011 compared to 2005).

The combined effect of these approaches has meant that over 0.8Mt of CO2 has been saved

between 2007 and 2011, which means on average over 160,000tonnes of CO2 each year has

been saved, which equates to taking over 55,000 average petrol cars off the road peryear.

Lafarge also developed an innovative cement recycling service for customers collecting any

out‐ofdate cement from customers and sends it to one of Lafarge’s Works to be re‐engineered
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
and processed back into making new products. For every tonne recycled Lafarge has pledged to

plant a tree within the local community.

Besides environmental benefits of reducing customers’ waste to landfill as these out‐of‐date

products would previously have been scrapped, by using this out‐of ‐date material in new

products, it reduces the extraction of virgin materials necessary to make new products. It also

provides a lower cost to customers than if they disposed via landfill.

Over 2,500 bags of cement have been collected and recycled, which is enough cement to lay

500,000 bricks. The initiative has been highly praised throughout the industry and has been

included in The Construction Products Association 2010 Innovation showcase publication.

Responsible Sourcing Lafarge Cement led the cement industry as it became first GB

manufacturer to obtain the responsible sourcing accreditation (BES 6001). This independently

and extensively assessment by BRE Global demonstrated that Lafarge is minimising and

managing its environmental impacts for areas like CO2, waste and transport as well as

demonstrating that its products’ supply chain is traceable and ethical.

Lafarge scored strongly for its products, achieving a ‘Very Good’ classification for its Bulk and

Packed cements and ready‐to‐use products. This innovative approach of having its entire range

assessed means that all of its customers from precast concrete manufacturers and ready mixed

to merchants and builders will all receive responsibly sourced products.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18
Communicating Sustainability – Strategy and Approach

Although Lafarge had numerous strong, tangible and unique sustainability achievements and

messages, communicating them in an engaging way represented a challenge due to the sheer

volume of sustainability communications in the industry.

Both qualitative and quantitative market research was conducted to determine what customers

thought about Lafarge’s current sustainability efforts, and how this compared to their

competitors.

In‐depth interviews were then carried out with customers. These showed that there was a

sense that organisations were only doing what had been forced upon them and that very few

cement manufacturers really cared about sustainability issues. The resulting insight was that if a

company was to lay claim to the sustainability territory – and, more importantly, could back up

their claims – there was potential for real differentiation in the marketplace.

Strategy and Approach ‐ Sustainable

All these factors led to the creation of the overarching Sustainable concept, which was used to

convey the message that Lafarge considers what being sustainable means for customers, not

just in theory but in practice. In short, Lafarge were able to deliver sustainability with a

purpose, with clear, tangible and commercial benefits for their customers, built‐in as standard.

And this could, in turn, be used by their customers to substantiate their own claims to

sustainability.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
Lafarge also utilised existing secondary research to unearth several suitable channels that could

be used to deliver their sustainability messages to the market. DM and email were tested on a

sample of customers, which provided enough backing to consider both for the campaign, with

email performance results being especially attractive.

Leveraging the SustainableTM core theme – ‘Lafarge is Sustainable because Lafarge is able to…’

‐ Lafarge provided hard evidence about Lafarge’s efforts towards sustainable construction in a

simple and original way.

Tactics and Implementation ‐ Sustainable

Direct mail, online display, email, and press were utilised for each message, which all directed

traffic to a purpose‐built Lafarge sustainability microsite, Sustainablelafarge.co.uk, which

completed the integrated campaign. Contacts were urged at every touch point to read more

about Lafarge’s sustainability credentials and to download the latest Lafarge Cement

Sustainability Report (When requiring hard copy.

SustainableTM also featured heavily on Lafarge’s exhibition stands at a number of sustainability

and construction events, the biggest and most relevant being Ecobuild 2010.

As well as the campaign’s unique core theme – SustainableTM ‐ the creative imagery was

illustrative rather than photographic. This style was previously unseen within the construction

industry where photography had dominated press and online. Using illustrations was not only

more cost‐effective for Lafarge, but also allowed the creative team more freedom to produce

imagery that accurately reflected the intended messages.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18
Tactics and Implementation ‐ Cemergi

The SustainableTM vehicle was also used to support the product launch of Cemergi®, which

also incorporated a strong creative idea based on Lafarge’s desire not to green wash, but to

provide hard evidence around it’s sustainability credentials.

The concept entitled ‘FACT’ was approved and rolled out to market. The thinking behind this

was very simple and stemmed from the volume of truths Lafarge could talk about regarding

Cemergi®. It was not an opinion or a market poll that made Cemergi® the number one

sustainable cement in the UK; it was and is a scientific fact. The concept allowed the message of

each communication to be absorbed quickly by utilising the visual representation of ‘FACT’

alongside a ‘reason to believe’ (e.g. No cement in the UK has lower embodied CO2).

This was backed up by qualitative research project carried out with potential customers’

decision makers and key influencers, which showed that majority viewed sustainability

communications with a large degree of cynicism. For example; they did not want to see more

campaigns showing green fields with children playing in the foreground etc.

Campaign Results

Although much larger than the packed sector in terms of value per order and total quantity, the

number of prospects and customers in the bulk‐buying sector that Cement manufacturers are

able to target directly is comparatively small. Therefore the following results are both a great

indicator that sustainability is becoming more important within the construction industry and
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
also act as a good indicator that Lafarge are effectively promoting sustainability within their

organisation.

Between 2007 and 2011, through developing and promoting sales of lower CO2 cements we

have reduced CO2 emissions by 1.1 million tonnes, which is approximately 200,000 tonnes per

year.

Results SustainableTM

Campaign email results were excellent with the highest open‐rate being over 25%. Average

clickthrough rates for the three emails was 7% (10% for the CO2 reduction message). 32%

completed the online survey and 43% of those respondents opted‐in to receive email

communications from Lafarge.

A key indicator of Lafarge’s sustainability perception comes from the annual Lafarge Cement UK

customer satisfaction survey. At the end of 2008 Lafarge’s sustainability image was at 68%,

which was improved upon by 1% in 2009. However survey results following SustainableTM

campaign activity at the back end of 2010 showed that Lafarge’s sustainability image had

increased to 76%, a 7% increase on the previous year.

Results Cemergi®

The Cemergi® information page received 219 unique visits in Q1 2011. Sales volume, market

share and penetration.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18
To book your table for this year's awards or to find out how to enter the Awards for

Excellence 2014 visit: http://www.marketingsocietyawards.com/how-to-enter

image: https://www.marketingsociety.com/sites/all/themes/zen/zen-

internals/images/pdf_download.png

Optional Images:

image: https://www.marketingsociety.com/sites/default/files/thelibrary/Lafarge%20-

%20UK%20Sustainability.png
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

image:

https://www.marketingsociety.com/sites/default/files/thelibrary/cmergi%20press%20ad.png
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
 Vaibhav Dixit
B.Com(H)IIYear
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 Vaibhav Dixit
B.Com(H)IIYear
2017-18

CHAPTER 8

COMPETITOR
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

COMPETITORS

The cement industry is a highly energy intensive sector. Energy and raw materials
(coal and lime stone) together form the most critical component in the
production of cement.

Figure X
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
*This is not an exhaustive list of inputs. Infact it only shows major merchandise
inputs used in the production of cement. The intention here is to show share of
various inputs and the customs duties that these inputs attract in India.

Figure 4 above shows the MFN tariffs on various cement inputs and the share of
these inputs in the production of cement. As visible in the graph, coal accounts for
a share of 10.3% of the inputs used in the production of cement, while lime stone
accounts for a share of 10%. Structural clay and plastic products account for a
share of 6.9% and 6.2%, respectively in the production of cement.

On the import duties front, while the tariff on cement in India was reduced from
12.5% to nil in January 2007 and it continues to be at the same level till date, the
inputs used in the production of cement continue to attract customs duty at the
levels close to 10%. The coal and petroleum products attract customs duty of
close to 5% and the cement clinkers18 attract a customs duty of 10%. As a result
the weighted customs duty of various cement inputs, in the production of
cement, is at around 6.8%.

This has created an inverted duty structure for the cement sector in India, which
acts as a disincentive for domestic cement producer, who has to pay higher price
for the raw material while the finished product (cement), can be imported duty
free. This may also partly explain the surge in India’s cement imports in recent
years.

The Union Budget 2010-11 has also increased excise duty on cement and cement
clinkers. It has also been proposed to impose a new cess, to be called the Clean
Energy Cess, on coal and lignite and peat produced in India, which will be
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
collected as a duty of excise from coalmines. This cess would also apply to
imported duty as CVD.

Issues

The input costs that primarily control the price of cement are coal, electricity
tariffs, railway transport and freight, royalty and cess on limestone. However,
interestingly, government controls the prices of all these components. The main
concerns that industry faces in using these inputs for cement production are as
follows:

 Coal: Coal is the main fuel for manufacture of cement in India. The
consumption of coal in a typically dry process system ranges from 20-25%
of clinker production.20 This means for per ton clinker produced 0.20-0.25
ton of coal is consumed. The cement industry consumes about 10 million
tonnes of coal annually. Since coalfields like Bharat Coking Coal Limited
(BCCL), Central Coalfields Limited (CCL) supply poor21 quality of coal, the
industry has to blend high-grade coal with it. However, non-coking coal and
petroleum coke attracts a customs duty of 5%, which increases the cost of
production in the sector.

 Electricity: Cement industry consumes about 5.5 billion units of electricity

annually with one tonne of cement requiring approximately 120-130 units
of electricity. Since state governments supply electricity in India and since
different states have different tariff structure, the power tariffs vary
according to the location of the plant and on the production process. As a
result, cement plants in different states attract different power tariffs.
Another major hindrance to the industry is severe power cuts. Most of the
cement producing states such as Andhra Pradesh, Madhya Pradesh
experience power cuts to the tune of 25-30% every year causing substantial
production loss.
 Vaibhav Dixit
B.Com(H)IIYear
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 Limestone: This constitutes the largest bulk in terms of input to cement.

For producing one tonne of cement, approximately 1.6 tonnes of limestone
is required. Since, the plants near limestone deposits pay less
transportation cost than others, the location of cement plant is determined
by the location of limestone mines. The total limestone deposit in the
country is estimated to be 90 billion tones, with Andhra Pradesh enjoying
the largest share of 34%, followed by Karnataka, Gujarat, Madhya Pradesh
and Rajasthan, with respective shares of 13%, 13%, 8%, and 6.5%. However,
cement manufacturing companies have to shed large sums of money by
way of royalty payment to the central government and cess on royalties
levied by the state government.

 Transportation: Cement is mostly packed in paper bags now. It is then

transported either by rail or road. Road transportation beyond 200 kms is
not economical therefore about 55% cement is carried by the railways.
There is also the problem of inadequate availability of wagons especially on
western railways and southeastern railways. Under this scenario, there is a
need to encourage transportation through sea, which is not only
economical but also reduces losses in transit. Today, 70% of the cement
movement worldwide is by sea compared to 1% in India.

Firm level performance

The performance of the cement industry is directly liked with the performance of
the economy. A robust economy with booming construction activities ensures
higher cement consumption. The same is true for the Indian cement industry. A
look at Figure XI below shows India’s GDP growth and the growth in Profit After
Tax (PAT) of India’s Cement industry closely follow each other.

Figure XI
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

During 2002-03, when India’s GDP growth slumped to 3.8%, PAT of Indian cement
industry fell by close to 30% over its level in 2001-02. Similarly when Indian GDP
growth increased to 9.7% in 2006-07, PAT of the cement industry skyrocketed to
199%, and the industrial sales jumped to 41.1%.

Structure of the Indian Cement Industry

The structure of the industry can be viewed as fragmented, although the

concentration at the top has increased, as the top 10 players control around 73%
of market share, which was 70% during 1990-91, whereas the other 27% of
market share is distributed among 32 players. This is also confirmed by the results
of Herfindahl Index (HI). The HI is a measure of industry concentration equal to
the sum of the squared market shares of the firms in the industry and an indicator
of amount of competition among them.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
Our calculations show a very low value of Herfindahl index in the cement industry
in India, indicating a very high competition and a low market power. High level of
competition in the cement industry is a result of the low entry barriers and the
ready availability of technology.

Figure XII

Figure XIII
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

Major Domestic Players

 Associated Cement Companies Ltd (ACCL): Associated Cement Companies

Ltd manufactures ordinary Portland cement, composite cement and special
cement and has begun offering its marketing expertise and distribution
facilities to other producers in cement and related areas. It has fifteen
manufacturing plants located throughout the country.

 Birla Corp: Birla Corp's product portfolio includes acetylene gas, auto trim
parts, casting, cement, jute goods, yarn, calcium carbide etc. The cement
division of the company has seven plants, with an installed capacity of 57.8
lakh tonnes. The company has two plants in Madhya Pradesh, Rajasthan
and West Bengal and one in Uttar Pradesh and holds a market share of 2.8
percent. It manufactures Ordinary portland cement (OPC), portland
pozzolana cement, fly ash-based PPC, Low-alkali portland cement, portland
slag cement, low heat cement and sulphate resistant cement. Large
quantities of its cement are exported to Nepal and Bangladesh.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

 Century Textiles and Industries Ltd (CTIL): The product portfolio of CTIL
includes textiles, rayon, cement, pulp & paper, shipping, property & land
development, builders and floriculture. Cement is the largest division of
CTIL and contributes to over 40 per cent of the company's revenues. The
company has an installed capacity of 7.8 million tonnes. CTIL has four plants
that manufacture cement, one in Chhattisgarh, two in Madhya Pradesh and
one in Maharashtra.

 Grasim Cement: Grasim's product profile includes viscose staple fiber (VSF),
grey cement, white cement, sponge iron, chemicals and textiles. With the
acquisition of UltraTech, L&T's cement division in early 2004, Grasim has
now become the world's seventh largest cement producer with a combined
capacity of 45.7 million tonnes. Grasim (with UltraTech) held a market
share of around 16.7 per cent in 2008-09. It has plants in Madhya Pradesh,
Chhattisgarh, Punjab, Rajasthan, Tamil Nadu and Gujarat among others.

 Ambuja Cements Ltd (GACL): Gujarat Ambuja Cements Ltd was set up in
1986. In the last decade the company has grown tenfold. The total cement
capacity of the company is 18.5 million tonnes. The company has a market
share of around 10 per cent, with a strong foothold in the northern and
western markets. Gujarat Ambuja is India's largest cement exporter and
one of the most cost efficient firms.

 India Cements: India Cements is the largest cement producer in southern

India with three plants in Tamil Nadu and four in Andhra Pradesh. The
company has a market share of 5.4 per cent.

 Jaiprakash Associates Limited: Jaiprakash Industries, now known as

Jaiprakash Associates Limited (JAL) is part of the Jaypee Group with
businesses in civil engineering, hospitality, cement, hydropower, design
consultancy and IT.

 Madras Cements: Madras Cements Ltd is one of the oldest cement

companies in the southern region and is a part of the Ramco group. The
company is engaged in cement, clinker, dolomite, dry mortar mix,
limestone, ready mix cement (RMC) and units generated from windmills.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
The company has three plants in Tamil Nadu, one in Andhra Pradesh and a
mini cement plant in Karnataka. It has a total capacity of 10 million tonnes
annually and holds a market share of 4 per cent.

Mergers & Acquisitions

The globalisation of Indian cement industry has also encouraged many foreign
cement manufacturers to engage themselves in agreements and deals with their
Indian counter parts to enjoy a share of pie in the rapidly growing Indian cement
market. These engagements have been primarily through various mergers and
acquisitions deals. Some of the major M&A deals between domestic and foreign
cement manufacturers in recent years have been-

 Lafarge India: It is a subsidiary of the Lafarge Cement Company of France. It

was established in 1999 in India with the acquisition of the Tisco and the
Raymond cement plants. Lafarge currently has four cement plants in India:
two integrated plants in the state of Chhattisgarh, one grinding station each
in Jharkhand & West Bengal. Total cement production capacity of Lafarge in
the Indian market currently stands at around 6.5 million tons. The company
produces different types cements like Portland Slag Cement, Portland
Pozzolana Cement.

 Heidelberg Cement - Indorama Cement Ltd: In March 2006, Heidelberg

Cement Company entered into a 50:50 joint venture with the Indorama
Cement Ltd. Heidelberg Cement Company is the leading German cement
manufacturing company, which was setup in 1873. It has its operations in
various countries across the Globe. The Company has two manufacturing
units in India - a grinding plant in Mumbai and a cement terminal near
Mumbai harbour.

 Holcim Cement - Gujarat Ambuja Cements (GACL): Holcim Cement entered

into a strategic partnership with GACL, in 2006, to acquire 14.8% in GACL.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
Currently Holcim holds around 56% stake in the company. Holcim Cement
Company is among the leading cement manufacturing and supplying
companies in the world. It is one of the major employers in the world,
having a work force of 90,000.The Holcim Cement Company has units in
excess of 70 countries all over the world.

 Italcementi cement - Zuari Cement Limited: In 2006, Italcementi Cement

Company with the help of the Ciments Français, a subsidiary for its global
activities, entered into an agreement to acquire shareholding of Zuari
Cement Limited, through a 50:50 joint venture. Italcementi Cement is
among the largest cement manufacturing companies in the world. The
company entered the Indian market in January 2001 when it acquired 50%
of Zuari Cement plant in Andhra Pradesh in southern India.

Profitability of Cement Companies

To evaluate the competitiveness of firms in the Indian cement industry, the paper
measures the dispersion in the performance of all the public listed cement
manufacturing companies in India, on the basis of following parameters:

 Profit Margin: It measures how much profit does a company earn out of
every rupee of sales. It is calculated as PAT/Net Sales.

 Interest incidence: Interest incidence measures the burden of interest

expenses on total profits of the company. It is used to measure the cost of
borrowed capital for a company.

 Gross fixed assets turnover ratio: Gross fixed assets turnover ratio
measures how efficiently fixed assets are utilized to generate sales.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
These performance indicators have been chosen, since it is possible to compare
these indicators across companies, irrespective of their size and years of
operation.

Competitiveness of firms

In the overall profitability rankings, Grasim Industries Ltd, was the most profitable
company in the Indian market, followed by Ambuja Cements and ACC Ltd. Over a
period from 2000-01 to 2008-09, the profits of Grasim Industries grew at a CAGR
of 17.7%, and that of Ambuja Cements increased by 14.1%. ACC Ltd and Shree
Cement Ltd saw the fastest increase in profits among the top five most profitable
cement firms in the Indian market. While the profits of ACC Ltdincreased at a
CAGR of 40.5%, the profits of Shree Cement Ltd increased at a CAGR of 49.7%.

Profit Margin

A look at the profit margin of all the cement companies in India shows that the
profits per rupee of sales stood in the range of 0.01% and 0.29%, during 2008-09,
which was lower than the profit margins during 2006-07, when the cement
industry was booming. During 2006-07 profit margins stood in the range of 0.1%
and 0.5%. Apart from the decline in cement demand, due to financial crisis, the
decline in profit margins may be attributable to excess capacity and decline in
cement prices during the period.

Figure XIV
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

Interest incidence

The cost of capital, on the other hand, for cement companies declined, during
2008-09, compared to 2006-07, when the interest incidence on profits was in the
range of 5% to 70%. Interest incidence during 2008-09 was in the range of 5% to
25%. This could be explained by various liquidity infusion measures that the
Reserve Bank of India initiated towards the latter half of 2008 to reduce the cost
of credit for Indian industry.

Figure XV
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

Gross Fixed Assets Turnover Ratio

During 2008-09, the gross fixed assets turnover ratio for Indian cement
companies 0% to 2.7%, in the same range as during 2006-07.

Figure XVI
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

CHAPTER 9

DATA ANALYSIS
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
DATA ANALYSIS
SURVEY FOR RETAILERS

1 How many brands having you currently?

12%
22%

Two
Three
29% Four
More than four

37%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
2 Which is more demandable brand according to you in the current market?

27% 26%

LAFARGE CEMENT
AMBUJA
ACC
ULTRATECH

23% 24%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
3 Are you keep LAFARGE Cement?

33%
Yes
No
67%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
4 Is this more profitable comparisons to others ?

47% Yes
53% No
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
5 Which brand is more marginable ?

LAFARGE
CEMENT
28% 29% AMBUJA

ACC
22% 21%
ULTRATECH
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
6 Which brand having the large market share according to you?

25% 27% LAFARGE CEMENT

AMBUJA
ACC
26% 22% ULTRATECH
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
7 On what basis you give purchase decision to the retailers:-

18% 17%

Price
Quality
Availability
23% Brand Image
29%
Others

13%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
8 What influence your sales decision?

24% 27%

Advertisement
Sales Person
Reference Group
Price
12%

37%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
9 Which brand would you like to Sale mostly?

22%
31%
LAFARGE CEMENT
AMBUJA
ACC
ULTRATECH
23%

24%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
10 How much the retailers intend to spend on Cement at a time?

5%

19%
37% 5000-7500
7500-10000
More than10000
Don't Know

39%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
11 How frequently times the retailers demand for the LAFARGE Cement?

7%
19%

1-2 Times
2-4 Times
4-6 Times
47% 6-8 Times
27%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

12 Which branded companies having the larger Ad in the Current market?

27% 29%
LAFARGE CEMENT
AMBUJA
ACC
ULTRATECH

24% 20%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
SURVEY FOR DEALERS

1 Please tick the name of the brands which you keep?

24%
37% LAFARGE CEMENT
AMBUJA
ACC
17% ULTRATECH

22%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
2 What affects retailers purchase decision?

Rely on Sales
Executive
24%
34% Friend Circle
51%
Advertisement
17%
25%
Word of Mouth
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
3. Are you using LAFARGE Cement?

27%

Yes
No

73%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
4. Are you satisfied with LAFARGE Cement?

34%

Yes
No

66%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
5 How much did you like the products quality wise of LAFARGE Cement?

7%
27%
Very good
Average
43% Good
Poor
23%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
6. If you want to go on another brand then on which brand will you go?

30%
37% LAFARGE
ACC
ULTRATECH
33%
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

CHAPTER 9

FINDINGS
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

FINDINGS

 Mostly the Dealers using LAFARGE Cement Brand for sale.

 According to the Market Survey LAFARGE Cement, Acc & Uktratech having the large
market share comparison to the others.

 But the customer know more things about LAFARGE Cement due to maximum
advertisement and more stability in the market as market strategy.

 SHREE Cement having more monopoly in comparison to other brands such.

 In comparison to other companies LAFARGE Cement, holding big size of advertisement

and on other Medias.

 Mean while when I was surveying the customers demand more Shree Cement as well as
LAFARGE Cement due to customer’s demand as SHREE Cement having large market
share in advertisement.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

CHAPTER 10

LIMITATIONS
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

LIMITATION

Although every effort has been in to collect the relevant information through the sources
available, still some relevant information could not be gathered.

 Busy Schedule of Concerned Executives: The concerned executives were having very busy
schedule because of which they were reluctant to give appointment.

 Time: The time duration could not provide ample opportunity to study every detail of the
company.

 Unawareness: Executives were unaware of many terms related to same while asking to
them.

 Confidential Information: As the company on account of confidential report has not

disclosed some figures. Moreover, in some cases separate accounts of division are not
separately maintained thereby, leading to restrictions in study.
 Vaibhav Dixit
B.Com(H)IIYear
2017-18

CHAPTER 11

RECOMMENDATIONS & SUGGESTIONS

 Vaibhav Dixit
B.Com(H)IIYear
2017-18
RECOMMENDATIONS & SUGGESTIONS

Promotional activities-This is one of the primary things that are required within the company.

During my visits to different Company, I came across that there is no awareness of the company in

the form of posters, stands and other related things. One thing that I would like to recommend

would be the introduction of more promotional activities so as to generate more revenues for the

company. Company can introduce more--

– Schemes

– Get together’ for channel partners

– Brand recognition in the market

– To Keep more inventories

– Advertisement in Industrial Area

Focus more on “b” and “c” category Companies - This is also one of the prime things that are

required. With around 80% of the revenues coming from less than 20% of the Companies, more

focus should be given on ‘b’ and ‘c’ category companies.’ A’ category agents are said to be the

agents who contribute more than Rs.50000 of revenues per month. Companies should focus more

on ‘b’ and ‘c’ category clients so that more of these clients can be converted into ‘a’ category.

Co-ordination among different channels-With agency office in a different building and no direct

control over the district operations, transparency between different channels is lacking. With the

plan for executives that I have suggested above, there could be more transparency that can come in

the overall operations of the NCR region.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18

Different commission slabs for different channels- With commissions being one of the prime

motives for the sales Executive to do business with different companies, more and more emphasis

should be given on the commissions that are rendered to the agents.

Very limited corporate tie ups-This should be one of the most important thing that should be on the

agenda for the travel category. A corporate tie-up can easily deliver a business of more than 50000

per month. Other than that, the contract is on a long term basis. This therefore helps in getting an

easy business for the company. Therefore, from my point of view, more emphasis should be given

on this category of business as well.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18

CHAPTER 12

CONCLUSION
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
CONCLUSION

However, when studied from the point of view of a customer there seems to be no major difference

among the SHREE Cement brands in a segment as far as performance is concerned. The brand

perception is dependant mostly on the peripheral cues depending upon the nature and quality of the

service provided along with the pricing, maintenance. It seems so! It seems as an undercurrent

sentiment is flowing and the perception of the customers is changing according to it. So this might be

the reason that despite Verna faring so high on the performance parameters still lags on the account of

converted sales.

The study shows that brand perception is something which starts building up before a SHREE Cement is

purchased and goes on with its use and is reflected in the recommendations the customer makes to his

acquaintances for the same products. Also, its seen that the customer might not be using the SHREE

Cement products still he holds the perceptions about it. Brand personality of SHREE Cement product is

enforced by the sellers in the mindsets of the customers and the customers react to it by forming their

perceptions about the Shree Cement products and this reflects in the overall brand image of the

products. So brand image and brand personality complement each other and the brand perception aids

the building of brand image.

Marketing and Sales Effectiveness is a category of technologies and services that refers to improving

business results through optimizing the efforts of Marketing and Sales, which, if properly aligned, make

each business group more effective. Marketing and Sales Effectiveness is frequently seen in Technology,

Pharmaceutical, Manufacturing, Insurance, and Financial markets.

 Vaibhav Dixit
B.Com(H)IIYear
2017-18
This would manifest itself as a set of technologies, business processes, and services which enable

companies to integrate processes and systems to achieve business goals. Technologies and

resources for Marketing and Sales Effectiveness include:

As for word-of-mouth, many people have the misconception that it only works for long

established brands. In fact, word-of-mouth hinges very much on brand quality and service level.

Relatively new brands can also generate word-of-mouth provided that they meet these two

criteria. Professionals, senior company executives and celebrities are the most effective

personalities for word-of-mouth promotion.

Many companies prefer to choose promotion through distributors when they first enter the

mainland market because distributors understand the local market conditions better. Besides,

local distributors have already established extensive networks and can directly and effectively

promote products and brands to consumers and other retailers.

Finally the major point that emerges out of this detailed study is a caution for the SHREE Cement

company. It says that there is no doubt that Indian Shree Cement market may be growing with a double

digit figure still the Shree Cement companies have a long way to travel to convince their customers

about the brand personality of their Shree Cement and how it suits the prospective buyers. Simply

because it simply is not a guarantee that how so ever good the customer might be holding the brand

perception and how so ever good the brand image may be it is not a guarantee that it will convert into

sale. SHREE Cement just like clothes and accessories suit the style and persona of a person and since all

products will become commodity someday the key to sell and excel in the market will lie with a person

who knows how to use the perceptions of the customers to its use and sell the Shree Cement products

‘coz ultimately only that products survives which sells!

 Vaibhav Dixit
B.Com(H)IIYear
2017-18

BIBLOIGRAPHY
 Vaibhav Dixit
B.Com(H)IIYear
2017-18
BIBLIOGRAPHY

Websites

1. www. wikipedia .com

2. www.lafargecement.com
3. www.google.com
4. www.magagine.com