Final Mkt Strat

Presented By : Name

Roll No

Harshad Shah

20

Irfan Shaikh

22

Navneet Lahoti

33

Shekhar Manjavkar

44

Vikas Mishra

51

Prateek Rander

56

2

Cement Outlook  Domestic cement consumption grew by 9% in

CY 07. CAGR (5 years) - 9%  Double digit cement demand growth expected in

the long term on the back of strong infrastructure development  New capacity of around 110 Mn tons over next 5-

7 years.  Prices expected to remain stable  Cost pressure on account of rising energy prices

Navneet Lahoti

3

Brief history – A growth story      

Capacity built up from 0.7 Mio t in 1986 to 18. 5 Mio t as of today at CAGR of 18% Organic growth and growth through acquisitions 2001 – Private equity investors (American International Group and Government of Singapore) invested in ACIL 2005 – ACIL restructured as a joint venture with Holcim 2006 – Founder promoters sold part of their holding in ACL in favor of Holcim ACL is a Holcim Group company since May 2006

Navneet lahoti

4

Sales and market share – South Market West Sales development share 100

12

27.2

29.7

80 4.1

5.1 6.2

5.3 6.1

11.1

40

10.6

15

15

0

32.0

34.0

3.9 4.9 6.3

12.1

4.2 4.7 7.2

11.9

4.0 5.3 6.9

9.1

8.3

4.9

5.1

5.2

2003

2004

2005

8.4

8.3

10

10.3

9.9

9.7

8.7

11.3

10.2

10.2

8.8

7.9

9.1

9.1

8.3

8.4

8.3

2003

2004

2005

2006

2007

ICL Others

ACC Madras

Grasim Kesoram

4 2

13

ACL

6

11.4

14

10.7

20

30.9

9.1

8

4.1

60

ACL Market Share in %

Mio t

[%]

UltraTech Zuari

13

6.0

6.5

2006

2007

0

Comments  Top three players represent

around 49.5% of the market share1  Dominance of regional players in

southern market

Navneet Lahoti

5

Sales and market share – North Central Market share

Sales development ACL Market Share in %

Mio t

[%]

12.2

12.9

13.6

12.7

12.2

Comments  Relatively fragmented – top three ACL Century Shree

Source: CMA

ACC JK Others

Grasim Jaypee

UltraTech Birla Corp

players now represent around 53% of market1  JK and Shree are relatively

aggressive competitors

Harshad Shah6

Sales and market share – East Market share 100[%] 80

Sales development 6 Mio t

10.2

11.5

12.3

11.0

11.0

4.3

4.4

6.2

5.0

4.9

6.9

6.7

6.8

7.8

7.9

18.0

19.0

17.3

18.0

19.0

14.1

11.3

60

5

0

7.7

7.9

8.4

9.1

1.5

1.8

2.0

2.2

1.4 2003

2004

2005

2006

2007

4 3

12.0

10.5 1

20

8.0

2

11.7

40

ACL Market Share in %

13

13

12

14

14

7.1

7.1

8.1

7.9

7.3

19.3

18.2

16.6

17.1

17.3

0

8.0

7.7

7.9

8.4

9.1

2003

2004

2005

2006

2007

Comments  Most consolidated compared to all

India  Top three players represent

ACL

ACC

Century

Lafarge

Grasim

UltraTech

Orissa

Birla Corp

around 66% of the market1

Others

Harshad Shah 7

Key financial figures. Rs. Crores

Full Year 2007

Full Year 2006

+/-

Sales volume2

16.9

16.3

3.68%

Sales

5705 5705

4848

17.68%

EBITDA

2239

1881

19.03%

EBITDA-margin

39.2%

38.8%

-

Profit after tax3

1769

1340

32.01%

Harshad Shah

8

4P’S

Product 

Premium brand: Only selling in retail marketing.



Functionality: Strong presence in growing markets of North & West. Hub & Spoke Strategy - Grinding close to markets.



Safety: Environmental Management Division



Packaging & Quality Shekhar Manjavkar10

Price  Full

Cost Pricing

 Stable

pricing environment

 Strong

cash flows and low debt : equity ensures financial flexibility for new projects

 Optimise

logistics costs through use of sea transportation to serve the key Mumbai market Shekhar Manjavkar 11

Price Lowest Cost Producer’s FY 2003

FY 2004

Increase/ Decrease(%)

Power

187

179

4

Fuel

227

254

(11)

Raw Material

136

133

2

Consumables

47

48

(2)

Direct Cost

597

614

(3)

Shekhar Manjavkar 12

Place Locations : Darlaghat, Ropar, Bhatinda, Pali, Kodinar, Sankrail, Bhatapara.

 ACL exports its cement from

Ambujanagar

 Export flows are expected to

decline due to strong domestic demand

 Optimise logistics costs through

use of sea transportation to serve the key Mumbai market

Prateek Rander 13

Place 

Extensive & primarily exclusive distribution network (Over 6,000 dealers and 20,000 retailers)



Captive Infrastructure: Port, Receiving Terminals and Captive Power Plants (260 MW)



Sea Transportation: Seven dedicated vessels for faster & cheaper transportation (35% exported by sea which is the cheapest)



7 owned ships for sea transport & 3 cement receiving terminals



Largest Exporter of cement: 15% of production Prateek rander 14

Promotion  Promotion

Strategy: pull strategy

 Public

relations & publicity: Ambuja Cement Foundation

 Advertising

Prateek Rander 15

SWOT ANALYSIS

Strength  High

quality cement  Good packaging  Strong distribution network  Advanced technologies  Eco friendly.

Irfan Shaikh17

Weakness  Need

of more market expansion.

 Need

of international marketing

 Not

able to use foreign technologies in full swing.

Irfan Sahaikh 18

Opportunities  Acquisition

of DLF cement and ACC ‘s

stakes  With

increase in G.D.P. growth rate country will need more roads ,ports , houses etc.

 They

get a chance to set up their plants at the nearest area of mines. Vikas Mishra 19

Threats  Lenders

unwilling to find new cement plant  Drought of many parts of the country have reduced demand from 21% to 11%.  Production cost increases :-due to increases in price of power ,freight ,coal, diesel etc.  Other cement manufacturer company i.e ACC,L&T etc. Vikas Mishra

20

Conclusions

 Solid market position built up within short period of time

through organic growth and acquisitions.  Pin-pointed

positioning tied to substantial captive infrastructure to serve markets including sea transportation, capability to export.

 High use of alternative raw materials in production of

composite cements.  Substantial Greenfield and Brownfield expansion plans

to grow within the attractive markets and an internal financing capability to fund expansion projects.

Vikas Mishra

21