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Ambuja Cements
BSE: 500425 | NSE: AMBUJACEM | ISIN: INE079A01024 | Cement - Major
- Directors Report
- Chairman's Speech
- Auditors Report
- Notes To Accounts
- Accounting Policy
- Finished Products
- Raw Materials
| Directors Report | Year End : Dec '07 |
The Indian economy posted a record growth of 9.6% in 2006-07,
accelerating from 9.4% recorded in the previous fiscal, and is expected
to clock close to 9% in 2007-08. The macro- economic fundamentals are
favourable for a sustained, rapid and more inclusive growth.
Industrial production recorded a growth of 10.63% in 2006-07, which is
attributed mainly to the manufacturing sector which grew at 12%.
The cement industry accounts for approximately 1.3% of the country’s
GDP. In 2006-07, it recorded a growth of 9.8% over 11.2% achieved in
2005-06.
Integration of Indian economy with the world has manifested in a
three-fold increase in foreign direct investment (FDI) flows into the
country, from US$ 5.5 bn during 2005-06 to US$ 15.7 bn in 2006-07. The
financial system is now more efficient and resilient than ever. The
external sector has been strengthened and considerable foreign exchange
reserves of US$ 275.55 bn or Rs.11.36 lakh crore (by December 2007 end)
have provided a cushion to withstand unforeseen financial
contingencies.
On the political front, it is expected that the country will continue
to steer a course that successfully balances the maintenance of a
vibrant democracy with the need for tough decisions to be taken
sometimes, in order to support long term sustainable growth.
Infrastructure has tremendous potential to contribute to the national
economy. Thrust is continued in several sectors such as roads,
railways, irrigation, water supply and sanitation, housing, urban
utility, civil aviation, airports, ports, power and energy.
Infrastructure spending is expected to grow by 2.3 times to Rs.20 lakh
crore in the XI plan period. This favours high consumption of cement,
which is also expected to continue its strong growth trend in 2007-08.
Since, the current capacities are not enough to meet the demand of the
coming years, over 110 million tonnes of new capacities have been
planned by corporate in the next 5 to 7 years.
During the calendar year 2007, 163.4 million tonnes of cement were
dispatched as against 152.5 million tonnes in 2006, registering a
growth of 7%.
FINANCIAL RESULTS
Stand Alone
Current Year Previous Year
31.12.2007 31.12.2006
(12 months) (18 months)
Sales (net of excise duty) 5704.84 6274.52
Profit before Interest and
Depreciation 3024.54 2280.95
Less: Interest 75.85 113.23
Gross Profit 2948.69 2167.72
Less: Depreciation 236.34 326.12
Less : Minority Interest 0 -
Profit before Tax 2712.35 1841.60
Provision for Tax 943.25 338.35
Profit after Tax 1769.10 1503.25
Add: Balance brought forward
from previous year 272.06 151.38
Add: Balance of Profit & Loss of
Joint Venture 0 -
Add: Credit Balance of Profit & Loss
Account as on 01.07.2005 of
erstwhile INSCL 0.21 0
Add: Credit Balance of Profit & Loss
Account as on 01.01.2006 of
erstwhile ACEL - 71.31
Profit available for appropriation 2041.37 1725.94
Appropriations:
Debenture Redemption Reserve (Net) (30.00) (72.05)
Transfer from Exchange Fluctuation
Reserve on cessation of subsidiary - -
Transfer to Reserve Fund - -
General Reserve 1100.00 1000.00
Dividend on Equity Shares
(including interim) 532.65 461.24
Dividend on Cumulative preference shares - -
Corporate Dividend Tax 90.52 64.69
623.17 525.93
Balance carried forward 348.20 272.06
2041.37 1725.94
Rs. in crore
Consolidated
Current Year Previous Year
31.12.2007 31.12.2006
(12 months) (18 months)
5792.08 6391.36
3103.63 2448.81
77.09 116.37
3026.54 2332.44
237.18 327.95
0 0.37
2789.36 2004.12
943.25 339.43
1846.11 1664.69
530.59 233.46
0 13.32
0.21 0
- 71.31
2376.91 1982.78
(30.00) (72.05)
0 (1.95)
0 -
1100.00 1000.00
532.65 461.24
0 0.26
90.52 64.69
623.17 526.19
683.74 530.59
2376.91 1982.78
CURRENT YEAR NOT COMPARABLE WITH THE PREVIOUS YEAR
The previous accounting year of the company comprised of 18 months,
from 1st July, 2005 to 31st December, 2006. The current year ended on
31st December, 2007 comprises of 12 months. The current year’s figures,
therefore, are not comparable with that of the previous year.
CHANGE IN THE NAME OF THE COMPANY
The company had set up its first cement plant in the joint sector with
GIIC in the state of Gujarat. To reflect the manufacturing base in
Gujarat, the name of the company was kept as Gujarat Ambuja Cements
Ltd.
As the operations of the company have spread to several states in the
country in the last 23 years, the word “Gujarat” was dropped to reflect
the true geographical presence of the company and the name was changed
to ‘Ambuja Cements Limited’ with effect from 5th April, 2007, with all
requisite approvals.
DIVIDEND
The company has paid an interim dividend of 125%, i.e. Rs.2.50 per
share during the year. 65%, i.e. Rs.1.30 per share, was considered on
account of the company earning non-recurring profit on sale of property
and investments. And 60%, i.e. Rs.1.20 per share, was considered on
account of operating profit.
We are pleased to recommend a final dividend of 50% (Re.1.00 per
share). The aggregate dividend for the year will amount to 175%, i.e.
Rs.3.50 per share, [65% due to non- recurring income and 60% on
operating profit] as against 165% (Rs.3.30 per share) in the previous
year (18 months). The total payout on dividend (including corporate tax
thereon) will be Rs.532.64 crore as against Rs.525.93 crore in the
previous year.
MR. A. L. KAPUR -
NEW MANAGING DIRECTOR
Mr. Anil Singhvi was appointed as Managing Director of the Company from
30th January, 2006 for a period of 5 years. He resigned with effect
from 1st May, 2007.
After the resignation of Mr. Anil Singhvi, the Board appointed Mr. A.L.
Kapur, then a Whole-time Director as the Managing Director of the
company w.e.f. 1st May, 2007 till the expiry of his agreement as
Whole-time Director, i.e. upto 30th April, 2009. His appointment as
Managing Director was approved by the shareholders on 4th October,
2007.
Mr. Kapur, a graduate in Arts, a Chartered Accountant and a Cost
Accountant, joined the Board as Whole-time Director in May 1999. He has
over 48 years of experience in the industry, and has occupied various
senior positions including that of CEO. He is also on the B oard of ACC
Ltd. Mr. Kapur is a seasoned, experienced and matured executive. He is
very well respected in the cement industry and, having worked in a
similar position in the past, has in-depth knowledge of corporate
management.
OPEN OFFER
The founder promoters of the company, Messrs Narotam Sekhsaria, Suresh
Neotia and others, sold 20 crore equity shares of the company
(comprising 14.78% of the then equity share capital) to the Holcim
group under the Shareholders Agreement dated 30th January, 2006.
Consequently, Holcim group made the first open offer in April 2006 at
Rs.90.64 per share to the shareholders of the company to acquire up to
20% of its share capital in compliance with SEBI (Substantial
Acquisition of Shares and Takeovers) Regulations. (SAST Regulations).
Messrs Narotam Sekhsaria, Suresh Neotia and others sold further 6 crore
equity shares of the company (3.94% of the then equity share capital)
at Rs.154.00 per share to the Holcim group in August 2007. This
purchase together with purchases made by Holcim Mauritius from the
market exceeded the threshold limit of 5% under Regulation 11 of the
SEBI (Substantial Acquisition of Shares and Takeovers) Regulations.
Holcim group, in compliance with the above mentioned regulations, made
the second open offer to acquire up to 20% of the share capital of the
company at a price of Rs.154.00 per share.
The open offer closed on 3rd December, 2007. 82483073 (5.42%) equity
shares were acquired by Holcim under this offer.
The Holcim group now holds 45.68% shares in the company.
IMPROVED PERFORMANCE: PROFITS REACH A NEW HIGH
While reviewing the performance of the company in the subsequent
paragraphs, we have considered the results for the calendar year 2007
over the calendar year 2006 to make the analysis of performance and the
comparison more meaningful.
Riding on the economy’s growth momentum, the company has posted
improved performance, with revenue and profits higher than ever before.
Performance Highlights
- Production of cement up by 4% at 16.9 million tonnes
- Sales of cement up by 3% at 16.8 million tonnes
- Domestic 15.4 million tonnes, up by 7%
- Exports 1.3 million tonnes, down by 28%
- Total sales up by 18% at Rs. 5705 crore over the previous year
- PBIDT for the current year at Rs. 2238.6 crore as against Rs.1880.7
crore in the previous year
- Net profit after tax at Rs.1846.1 crore as against Rs. 1435.2 crore
in the previous year
- Exceptional Income during the year was Rs.795.5 crore as against as
Rs.30.5 crore in the previous year.
Production
An encouraging increase: From 16.3 million tonnes to 16.9 million
tonnes.
The company has reported an increase in cement production, from 16.3
million tonnes in 2006 to 16.9 million tonnes in 2007.
This growth was achieved despite serious setback in production at our
unit at Ambujanagar – which was affected by unprecedented floods in
August – September 2007. The higher cement production was due to higher
blending ratio in 2007, as well as the commissioning of the new
grinding facilities.
The clinker production was marginally lower at 11.6 million tonnes as
compared to 11.7 million tonnes in the previous year. Higher
production at Darlaghat and Rabriyawas was not sufficient to compensate
for the loss of production at Ambujanagar following the floods.
Plant-wise production was as follows:
2007 (Jan - Dec) 2006 (Jan - Dec)
(million tonnes) (million tonnes)
Plant Cement Clinker Cement Clinker
Ambujanagar 4.8 3.7 4.9 4.1
Maratha 3.2 2.5 3.1 2.5
Darlaghat 1.3 2.6 1.2 2.4
- Ropar 2.8 - 2.8 -
- Roorkee 0.1 - - -
Rabriyawas 1.8 1.6 1.7 1.5
- Bhatinda 0.6 - 0.5 -
Bhatapara 1.0 1.2 0.9 1.2
- Sankrail 1.2 - 1.2 -
- Farakka 0.1 - - -
Total 16.9 11.6 16.3 11.7
Marketing
We have new systems in place to take care of the growing economy
Fast growing mass housing, commercial and infrastructure sectors in big
cities. Strong retail demand in smaller towns. A resurgent rural
sector. In this all-round development, the marketing team set two tasks
for itself – increase presence in the fast growing markets and increase
brand-building efforts in its traditionally strong retail market.
Exports, by design, fell behind.
To meet the challenges and demands of the rapidly rising construction
sectors, we set up a separate team modeled on some of the best Key
Account Management principles.
To its key customers, the team has positioned itself as a partner in
providing solutions. A series of initiatives taken by this team has
given us a tremendous advantage in Mumbai to gain a strong foothold in
this sector. A similar approach is being extended to other areas of
our market’s hotspots.
While the brand increased its position in Mumbai and other hotspots of
cement consumption, we have continued to build on our leadership
position in its traditionally strong market - retail in smaller towns
and rural markets. We have also developed a unique homespun channel
management model called Channel Excellence Programme (CEP). Over 7000
dealerships and 20,000 retailers across India are covered under this
model.
It delivers great value to the channel partner. Besides the sales
support, he receives administrative training, technical and promotional
support.
This program emphasizes the relationship management approach to build
strong business ties with the dealers and retailers. Various
initiatives like personal growth, family welfare and children’s
education and healthcare are taken for the channel partner and his
family. These initiatives are structured and packaged as Ambuja
Parivar and Ambuja Parivar Mahotsav.
Sensing the new awareness and willingness of the rural communities to
build their own infrastructure like concrete roads, check dams and
schools, the company has set up a sustainable rural marketing model.
Our rural marketing team identifies services and contributions that
will significantly contribute to the rural society.
Under this, we have provided technical support in building rural
infrastructure and training masonry skills to the villagers. Our rural
team has helped build a number of schools under the Sarva Shiksha
Abhiyan in many parts of Maharashtra and Gujarat. It has also held a
series of mason training programs with the help of CIDC in Rajasthan.
And it has trained village communities to build check dams and roof
rainwater harvesting structures.
While our marketing team has consciously spotted opportunities to
deliver value to the consumer, a new analytical business tool developed
by Holcim, called Holcim Value Chain (HVC), has given them added
impetus. We are in the process of building a complete value chain to
deliver maximum value to the customer. Once integrated in our business
plan, the outside-in approach of the HVC will give us a more robust
model and will enable us to take up many exciting opportunities in the
market.
Domestic cement demand Overall market share of 10%. And a 7% growth in
volumes.
Western Region
The west includes India’s single largest cement market – Mumbai. And
the single largest cement consuming state – Maharashtra.
In the west, demand went up by 13.5%. The company received a setback
at the Gujarat plant when floods disrupted production for almost two
months. However, our people did a commendable job in retaining our
strong presence in the region at 20%.
The company could achieve increased volumes by resorting to purchase of
clinker from outside, diverting cement from exports to the domestic
markets and increasing the blending ratio.
Northern Region
In the northern states, demand went up 9.5%. The company continued its
strong presence in this region despite supply constraints, which were
overcome partially through increased production of clinker at Darlaghat
and Rabriyawas and through increasing the blending ratio. With these
proactive measures, we were able to maintain our leadership position
with over 18% market share.
Eastern Region
Demand in the eastern region has grown at a relatively slower pace at
3%. Despite the slow demand growth, the company increased its volumes
by 12%, thereby improving market share from 8 to 9%.
Exports: A planned reduction
In view of the good domestic demand and improved realization, coupled
with depreciation of the US Dollar, the company gradually reduced its
export volume during the year. Total exports for the year stood at 1.3
million tonnes as against 1.8 million tonnes for 2006 - down by 28%. In
2007, our revenue from exports was Rs.277.5 crore as compared to Rs
383.7 crore in 2006.
Costs: Up by 20% Coal
In terms of calorific value, average cost in 2007 was 60.14 paisa/000
kcal - up by 20% over the previous year.
The company procures both domestic and imported coal. Overall average
cost of coal was Rs 2,935 per tonne in 2007 - up by 12% over 2006.
Average landed cost of domestic coal in 2007 was up by 2% at Rs 2597
per tonne. This is primarily due to increase in royalty in August 2007
by an average of 15-25%, a hike in pithead prices of all the grades by
10-15% by Coal India towards the end of 2007, and minimum chargeable
freight imposed by the Railways. Average landed cost of imported coal
was Rs 3794 per tonne in 2007 - up by 33% over
last year. The CIF per tonne price of imported coal, which is mainly
used at Ambujanagar, has gone up from US$ 60 in the beginning of 2007
to US$ 130 by the year-end.
During 2007, specific thermal energy was 742 kcal per kg of clinker.
This is marginally higher (by 1.6%) over the previous year despite the
adverse impact of floods at Ambujanagar.
Additionally, the Ministry of Coal has reduced coal linkages to cement
companies, thereby forcing cement companies to source coal from
e-auctions at high rates – at a minimum 30% higher than the notified
price applicable on coal linkages.
The bigger concern is the deterioration in the quality of domestic coal
that’s affecting our productivity.
Power: Self-sufficiency through captive power
During the year, the company commissioned 60 MW captive thermal power
plants at Ambujanagar. For the company as a whole, 79% of our power
requirement is met through captive power generation.
Power consumption in 2007 was 84.6 kwh per tonne of cement as against
86.6 kwh in the previous year. This could have gone up on account of
the unprecedented floods at Ambujanagar, but the company was able to
contain it through improving blending ratio over the previous year.
Average cost of power generation (grid & captive) was Rs 2.88 per unit
- up by 4%. While cost of grid power went up by 2%, cost of power
generation, through CPP, was at Rs 2.68 per unit - up by 5%. This was
primarily due to increase in the cost of coal.
Year Captive power usage (%) CPP (Rs/kwh) Grid (Rs/kwh) Average
(Rs/kwh)
2006 80 2.56 3.54 2.76
2007 79 2.68 3.62 2.88
The power load factor during 2007 was 84 as against 81 in 2006, which
helped in containing the power generation cost.
By using different varieties of alternate fuels like biomass and by
using Waste Heat Recovery, we have reduced our coal and fossil fuel
usage in captive power generation.
Freight: A fast-track approach for quicker turnaround
During the financial year, on per tonne basis, share of “freight and
forwarding cost” to “total cost” went up by 1.4% over that of last
year, largely due to shift from exports to the domestic market and
longer lead dispatches by road due to non-availability of adequate
railway rakes. Various freight surcharges imposed by Indian Railways
adversely impacted railway freight.
Our people adopted innovative steps such as fast track dispatches at
certain locations to derive benefits through higher turnaround of
trucks.
Opening new Grinding Units. And upgrading existing ones
The company has continued to pioneer the Hub and Spoke concept in
conducting business. Being closer to fly-ash sources and the markets
helps save on the logistic costs.
During the calendar year 2007, the company commissioned grinding
stations at Farakka in West Bengal and Roorkee in Uttarakhand with
capacity of 1 million tonnes per annum each. This is in addition to its
three existing grinding stations. These grinding stations will enable
the company to provide the customers in these regions with fresh cement
and save logistic costs.
During the year, the clinker production at Rabriwayas in Rajasthan was
upgraded from 1.6 million tonnes to 2 million tonnes per annum.
BULK CEMENT TERMINALS
A new record in cement dispatch: 1.4 million tonnes
The ship, which was grounded during 2006, was completely refurbished
and put back in service in March 2007.
Total cargo (inbound and outbound) handled at Muldwarka was 6% less
than the previous year, at 3.8 million tonnes, due to reduced exports.
The cement dispatch from our Panvel cement terminal set a new record of
1.4 million tonnes in 2007, compared to 1.2 million tonnes in 2006.
Cement dispatches from Surat were 0.3 million tonnes as compared to 0.4
million tonnes in 2006.
Due to the heavy rains for the last couple of years, the draft at
Muldwarka port has reduced, resulting in cargo loss, difficult berthing
for larger vessels and reduced throughput both inbound and outbound.
The company has initiated steps to restore the draft by resorting to
dredging operations.
EXPANSION AND UPGRADATION
To participate in the growth of the cement industry, the company has
planned capital expenditure programmes aggregating to about Rs 3500
crore. This would help the company maintain its market share going
forward.
Clinker capacity expansions
The company is setting up new clinker capacity at Bhatapara in
Chattisgarh and Rauri in Himachal Pradesh, each having a capacity of
2.2 million tonnes per annum. The project work is progressing well. The
clinker unit at Bhatapara is slated to be commissioned in mid 2009
while the unit in Rauri is expected to go on stream in the second half
of 2009.
The total investment in these projects is estimated at Rs. 1600 crore.
Grinding Stations
In line with the Hub and Spoke strategy, we are setting up four cement
mills. We are increasing cement grinding capacity by 5.5 million tonnes
per annum which will be commissioned in 2009-10.
Location Cement (million tonnes) Year of Commissioning
Dadri (UP) 1.5 2nd half of 2009
Nalagarh (Himachal Pradesh) 1.5 1st half of 2010
Ahmedabad (Gujarat) 1.5 1st half of 2009
Barh (Bihar) 1.0 1st half of 2010
Total 5.5
Capital investment for setting up these units is estimated at Rs.1000
crore. The installations of new grinding units are aligned with the
expansion of the clinker capacity.
Terminal
The company is setting up a Bulk Cement Terminal (BCT) at Kochi in
Kerala. The total investment in this project is estimated at Rs 66
crore.
It is scheduled to be commissioned in early 2009. This terminal will
help the company to participate in the growth in Southern India and
provide reach to this market by sea route cost effectively.
Captive Power Generation
We are reducing our dependence on grid power by installing additional
captive power plants aggregating to 178 MW at different locations.
Captive power ensures continuous and consistent supply of power at a
much lower cost. Of the 178 MW, 2 units of 30 MW each at Ambujanagar
in Gujarat and 6 MW at Ropar grinding station in Punjab were
commissioned during 2007. This brings total captive power capacity to
407 MW. The balance 112 MW is expected to be commissioned during 2008
at an estimated cost of Rs. 545 crore.
Shipping Fleet Expansion
The company presently owns seven ships for transport of cement from
Ambujanagar to Panvel and Surat. The existing fleet is just sufficient
to meet our present requirement. Adding shipping capacity has become
necessary to respond to the growing cement demand in coming years.
With this in view, the company has placed an order for one ship of the
capacity of 4500 DWT at an investment of Rs 50 crore approximately. The
ship is expected by the end of 2008.
Orders have been placed for two more ships, one of 4,500 DWT and the
other of 2,800 DWT for delivery by 2009.
The addition of these three vessels will greatly enhance our ability to
cater to the growing market needs of South Gujarat and Mumbai.
SAP IMPLEMENTATION:
The company is implementing a project -
Connect India Plus”, which aims at connecting all the plants, business
places across India online, under a standardized business template to
run on SAP software.
The implementation of project CONNECT India Plus started in June, 2007
and is expected to go live in August, 2008. After the Go Live, all
operations, locations and transactions will become fully integrated in
a manner that is in line with the updated data and information.
The new system will greatly enhance the company’s capability to capture
and process a comprehensive range of data to be used for
decision-making and day-to-day operations, while automating some
processes which were not part of the IT legacy system.
Project CONNECT India Plus will integrate good governance practices
into the business processes through the use of IT tools and software
components. It will incorporate Internal Control requirements through
well-defined authorization profiles and rigid systems.
HOLCIM’S SUPPORT
The integration program with Holcim is progressing well. Holcim which
has a presence in 70 countries across the globe has extended its
support to help us achieve global benchmarks.
It is implementing various programmes across the company, which
includes building robust business systems and processes, through the
implementation of SAP.
Talent Management
Holcim aims to be recognized as one of the most attractive employers
within the industry. It has implemented various programs, including
Leadership Development Program and development program for senior
management, introduction of variable compensation scheme, cross border
transfers, talent assessment program to evaluate people so they could
take up higher responsibilities.
Increase use of Alternative Fuels and Raw Materials (AFR)
Holcim are experts in the area of Alternative Fuels and Raw Materials
(AFR). It has been successful using various AFR, both as fuel in the
cement manufacturing process as well as in the captive power generation
process. The company would leverage
Holcim’s experience in using cut tyres, municipal waste, petrochemical
sludges and other hazardous waste across the globe. The company is in
the pilot stages for using some of these AFR’s at its plant locations.
Occupational Health and Safety (OH& S)
The health and safety of the people at Holcim is a key priority. This
not only includes its own employees but also for the personnel of
sub-contractors and for visitors. The implementation of the Holcim
Safety Pyramid – “Passion for Safety” encompasses events, which on
successful implementation would help us achieve our goal of “no harm”
environment within the company.
Sustainable Development
The three guiding principles of “Value Creation”, “Sustainable
Environmental Performance” and “Corporate Social Responsibilities” are
well anchored in the Holcim Business Model and enshrined in the
Management Systems. They can also be found in our company’s business
model and management systems.
THE FUTURE LOOKS BRIGHT
The momentum of growth in the infrastructure and housing industry is a
good sign for the cement industry. The government has set a growth
target of 9 % for the economy during XIth Plan (2007 – 2012). The
cement demand growth is projected at 9.5% CAGR for the XIth plan.
Further, the government has emphasized on public-private partnerships
for removing bottle-necks for developing the infrastructure in the
country. We see that the private sector is poised to play a very major
role in the development of this infrastructure.
Given the overall economic growth, inflow of foreign investments,
thrust on infrastructure development and boom in the housing
construction, we believe the cement demand should display strong growth
in the next 3 to 5 years. In view of this robust growth, many cement
companies have announced fresh capacity expansion.
It is expected that over the next 5 to 7 years, new capacities of over
110 million tonnes would be set up across the country.
While there are high growth opportunities, there also lie big
challenges ahead. Bunching of new capacity in a short span could lead
to pressure on prices and distribution network in 2009. We are gearing
up to meet these challenges.
The ominous signs of recession in US economy, accentuated by 75 bps cut
in interest rate, and the emerging signs of domestic inflation rate
going up may generally impact overall economic growth.
RISKS & AREAS OF CONCERN
We are geared to respond to changing conditions
Coal
Coal is a wild card for the cement industry. Coal is used by the
company both as a fuel in the cement manufacturing process as well as
in captive power generation. This entails the effective sourcing of
coal, both in terms of quality and pricing, which is very critical for
the overall performance of the company.
Domestic coal
The distribution, allocation and pricing are controlled by the
Government. The deterioration in the quality and the timely
availability is a major concern for the company. With the shrinkage in
coal linkage, the company needs to source coal from e- auctions and
through spot buying at significantly higher rates, generally 30% to 40%
more than the notified prices.
Imported coal
Prices for imported coal have risen sharply during the year, from less
that US per tonne (CIF) in December 2006 to US 0 per tonne in
December 2007.
The company has drawn plans to meet the coal requirements in a planned
and cost- effective manner.
Freight
International crude prices are ruling consistently at very high levels
resulting in higher cost of Indian crude basket. This continues to be a
source of anxiety, as any increase in diesel prices would adversely
affect road freights. Timely availability of rakes from the Indian
Railways is also a cause of concern.
Incidence of Taxes
The incidence of taxes on cement is extremely high, despite the fact
that cement is an essential infrastructure commodity. The overall tax
is as high as over 50% of the ex-works realization.
Project Execution
The capital goods and engineering industries have their order books
full for a couple of years. The delivery periods quoted for equipment
are growing longer. The boom in the construction industry has further
compounded the problem. There is a scarcity of experienced civil
contractors – a necessity
for timely completion of projects. All these factors may increase the
challenge to execute projects on time and also impact the cost.
Efforts are being made to motivate civil contractors by additional
financial incentives to speed up construction.
Bunching of Capacity
The setting up of newer capacities by the cement manufacturers could
lead to bunching of cement capacity in the short term. This could bring
pressure on cement prices, affecting the bottom lines.
HOW INTERNAL CONTROL SYSTEMS HELP US TO INCREASE EFFICIENCY
The company’s Internal Control Systems are commensurate with its size.
The company places great emphasis on the maintenance of effective
internal controls, both from the point of view of compliance with
statutory requirements as well as supporting the smooth and efficient
running of the business.
In an effort to further improve the reliability and efficiency of
business processes that have an impact on financial reporting, the
company has embarked on an Internal Control Systems project to
standardize and properly document the major processes and associated
key controls. Responsibility for ensuring correct and timely
performance of the controls has been assigned to specific individuals
at all company locations.
This formalized system of controls helps to meet the statutory
requirements of both Clause 49 of the SEBI Listing Agreement, and the
equivalent Swiss Stock Exchange Code, with which the Holcim Group is
required to comply from 2008.
Systematic testing of the effectiveness of internal controls is being
carried out by the company’s internal audit department, in order to
provide assurance to the audit committee and board of directors
regarding the adequacy and reliability of the system.
The Internal Audit function was established on inception of the company
and, in addition to monitoring effectiveness of controls, provides an
independent and objective assessment of the overall governance
processes in the company, including the application of a systematic
risk management framework.
The scope and authority of the function are laid out in an Internal
Audit Charter, which is approved by the Audit Committee. Internal Audit
plays an important role, not only in providing assurance to the board
of directors, but also in providing a value-adding consultation service
to the business operations.
SUSTAINABILITY INITIATIVES
Environment Management: We won the Environment Excellence Gold Award
for outstanding achievement in environment management
The company has adopted state- of-the-art technology from glass bag
house to surface miner, rock breaker to bulk cement terminals and from
CDM to
GHG emission control.
As against statutory norms of particulate emission of 150 milligram per
normal cubic meter of gas, the company has always maintained 50
milligram per normal cubic meter of gas. This was possible as the
company installed Glass Bag house to treat particulate pollution from
kiln as against the industry practice of using electrostatic
precipitators.
As per statutory requirements, it is necessary to treat domestic waste
water in cement plants using the conventional way of treatment and
disposal. However, the company went one step further in treating waste
water in what we call sewage water recirculation plant (SWRP).
Extensively treated water from SWRP is used as source water in our
cement plant or Captive Power Plant (CPP) and thus reducing fresh water
consumption.
We are also very conscious about noise pollution. We follow
sophisticated method of blast control using delayed detonators in mines
and hence there is minimal noise during blasting. This also ensures
that the surrounding areas are not affected as the vibrations are of
lower intensity.
At our limestone mines also, the company has adopted various
environment- friendly methods. One of them includes installation of
fogging devices using water mist to control fugitive emission while
handling limestone. At our Bhatapara limestone mines, an innovative
method of stabilizing slopes of the waste material has been done using
coir matting with greenery plantation.
Water bodies have been created at the mined outpits that reduced
salinity ingress in the area, thus helping farmers to grow additional
crops.
Our efforts have been appreciated. This year, our Himachal unit was
awarded Environment Excellence Gold Award for outstanding achievement
in environment management by Greentech Foundation, New Delhi.
Our efforts of restoration of mining area have been appreciated, not
only by Industry Associations, namely, Federation of Indian Mineral
Industries (FIMI) and Confederation of Indian Industry (CII), but also
by Ministry of Environment and Forests (MoEF) and the leading NGO of
India, the Centre for Science and Environment (CSE). The National
Council for Cement & Building Materials (NCBM) during an all-India
competition conferred Second Best Environmental Excellence Award for
our limestone mines at Ambujanagar.
Fly ash. The waste product that helped us produce larger volumes of
cement
The disposal of fly-ash, a hazardous waste from power plants is a major
national concern. To tide over the power shortage in the country, large
coal based thermal plants are being set up by power companies, leading
to more fly-ash.
Over the years, we spent time and capital at our R&D cell, to see how
we could use this waste in manufacturing cement without compromising on
the quality.
We moved our business focus from OPC (Ordinary Portland Cement) to PPC
(Portland Pozzolona Cement) by grinding fly ash with clinker to produce
cement at all our manufacturing locations. For this, we have made
necessary changes at our manufacturing plants to bring in systematic
addition of fly ash. However, while doing this, we have taken utmost
care to ensure that the quality of cement thus produced is equivalent
to the strength of OPC.
Over the years, we have gradually increased consumption of fly ash from
2.2 million tonnes in 2005 to 4.1 million tonnes in 2007. This has also
helped us produce larger volume of cement without correspondingly
increasing our clinker production and thus reducing green house gas
emissions such as CO2. This has also solved the problem of disposal of
the material.
The company, in line with its policy in other states, has converted its
entire Mumbai market (which was predominantly
OPC based) into a PPC market. In future, we plan to produce more
blended cement and propose to set up grinding units across the country,
based on locally generated fly ash.
Alternate fuel and raw materials. They help reduce emissions
The use of alternate fuels and raw materials (AFR) is not only
beneficial in terms of reducing CO2 emissions, but it also is our
thrust area for sustainable development. The co-processing of
hazardous/ non-hazardous wastes in cement kilns and boilers in CPPs
help solve a major environmental problem faced by several industries.
Our captive power plant at Ropar is run on biomass of different
varieties for about 5-6 months in a year. This has not only resulted in
saving on costs but also helped reduce usage of precious coal.
We have conducted trials for usage of other waste products such as
municipal waste and tyre chips at our laboratories.
The extensive use is dictated by the procedural requirement of getting
various approvals from appropriate environmental authorities. We
propose to use the available waste materials in cement kilns for
sustainable development in the year 2008 with the requisite approvals.
OCCUPATIONAL HEALTH & SAFETY
Change in mindsets: Working towards zero harm
OH&S has been accorded high priority in all spheres. Considerable
executive time and energy has been invested in this area.
To focus on this crucial aspect, DuPont, a leading international
consultant, were assigned the task of disseminating knowledge and
techniques to various functionaries to ensure that the “zero harm”
objective is achieved. It is planned to cover all line functions
through specific training within 2008. This is resulting in better
awareness and appreciation for assuming responsibility by each and
every individual in the company to ensure risk-free and totally safe
working environment.
Training has also been imparted on techniques to systematically
identify hazard areas, adopt measure to eliminate hazards and, in the
event of any unfortunate mishap, to conduct scientific incident
investigation to get to the root cause of the incident and eliminate
such mishaps in the future by instituting remedial measures. Learning
from these investigations is disseminated to all the manufacturing
units with a view to prevent recurrence anywhere in the company. Safety
drills are conducted as a regular feature.
The major challenge of safety of third party employees has also been
addressed by appointing construction safety management experts from
India and abroad for on-site training and monitoring of safety during
construction.
The continuing emphasis given to OH&S is helping to change mindsets of
individuals and employees have now started thinking of safety in each
activity undertaken.
CORPORATE SOCIAL RESPONSIBILITY
Making way for a vibrant and dynamic neighbouring community
Through Ambuja Cement Foundation set up in 1993, the company has
engaged the neighbouring communities as partners in all developmental
activities.
Last year, the company was able to reach out to over 1.2 million people
in over 670 villages from 10 states across the country. Since all the
issues tend to be interrelated, our approach has been aimed at
dovetailing our efforts to respond to each of their issues.
The company has carried out numerous activities like water harvesting
and conservation to prevent salinity ingress in areas close to the sea,
sustainable agriculture and animal husbandry, health & sanitation, HIV
/ AIDS programme, promotion of self-help groups of women for socio-
economic development and capacity building for enhancing skills of
students, women and farmers in the villages adjoining all our
locations, as our commitment to corporate social responsibility.
We raised the water table to a whopping 25 feet in Rajasthan
Based on the success of our Natural Resource Management, we continued
working on water in states like Gujarat and Rajasthan that
traditionally face water problems. In the process, we found a balance
between traditional knowledge and scientific knowhow. Sealing the
bottoms of the wells has considerably improved their quality of water
in Gujarat.
Our techniques were so effective that the government has now decided to
take on the project on a larger scale in other areas in Gujarat.
In Rajasthan, we focused on improving the traditional reservoirs of
water. Ponds that had been used as reservoirs of water for years were
deepened and in places where it was possible, they were interlinked.
Seasonal rivers were de-silted and in some cases dykes were built under
the river bed to increase the flow of underground water in the region.
The result was that the dykes have helped the water column in the
existing wells to rise from an average of 11 feet to a whopping 25
feet.
Alternate livelihoods. Skill enhancement for a brighter future
Through intensive training programmes, we have introduced farmers to
better technologies and cropping techniques, increasing their yield in
agro-based livelihoods. Expansion into alternative livelihood options
meant sustained incomes for the families, which in turn directly
influenced the standard of living of the family. Moreover, as
agriculture is a seasonal activity, it is easily possible for a family
to engage in an alternate occupation during the lean months.
Taking into consideration the availability of materials locally, the
interests of the people and the traditional crafts of the area, the
company has initiated programmes on alternate livelihoods across all
locations.
Groups are now engaged in various activities like dairying, making
bags, incense sticks, soaps, detergents, candles, garments and
embroidered products, handicrafts,in addition to developing nurseries,
running flour mills and grocery shops amongst others.
In collaboration with the leading banks in the area, we have
established two Skill and Entrepreneurship Development Institutes in
Rajasthan and H P, where hundreds of youth had an opportunity to enroll
for skill training. Courses that would generate employable skills were
selected on the basis of local surveys. Courses for computer literacy
and DTP, mobile repairing, auto and electrical maintenance, garment
making, television and radio repairs were offered after personal
interviews and assessment of aptitude of the candidates. With our
assistance, several placements were made in existing set-ups and some
trainees were facilitated to obtain bank loans to establish small
businesses. An overwhelmingly large number of trained persons are now
gainfully employed.
Village self-reliance. New inroads into community health
Our efforts in training and empowering tais, or village health
functionaries, are an important part of our inroads into community
health. They have been consistently providing primary health care to
the villagers. We have increased their responsibilities to include
pre-natal care and the care of new born infants.
Their active monitoring of new-born infants and the expectant mothers
has helped in bringing down the infant mortality rate in the villages.
They continue to provide medical help to the villagers, refer serious
cases to hospitals, assist the mobile dispensary operated by the
company during its regular visits and conduct sessions in their own
communities on preventive health education. After the success of our
project in Chandrapur, where thousands of people including tribals
benefited, we have now extended the project to several of our
locations.
Waging a war for an AIDS-free supply chain
Taking the lead in the area of HIV/AIDS, Ambuja had formally accepted a
policy on this issue in the year 2004.
Following this, we have initiated various activities at our plants and
corporate offices. All these activities are geared towards awareness
generation and prevention.
We recognize that our workplace programme must reach out to those in
our supply chain. We have a large programme for our truckers who are an
important part of this chain.
Since the railways also form a significant part of the cement supply
chain, we have initiated an awareness programme for the labourers
working at our cement yards. We began with the yards in Mumbai and are
gradually expanding it to include other yards across Maharashtra. In
course of time, we are sure this will have a multiplier impact on other
railway yards across the country.
Accolade from the Asian Institute of Management
We have been appreciated for our work at various forums. The Sixth
Annual Asian Forum on Corporate Social Responsibility conferred the
Asian CSR Awards for our comprehensive programme on health and
HIV/AIDS.
School Education Programmes: A ticket to a brighter future
A school support programme has been put in place in which the
government schools in the villages are supported by us in terms of
infrastructure, mid-day meals and quality of education. An extension of
the school support programme is the training programme for teachers and
the government established Village Education Committee (VEC) members.
In addition, we have established centres for pre-school education as
well as those for non-formal education. Having improved the quality of
the village schools, we have further energized the VECs to effectively
monitor and maintain the quality of education in the villages.
Besides bringing in the required ownership, this is enabling the
programme to attain sustainability.
Manovikas Kendra: Reaching out to special children
We are proud of our Ambuja Manovikas Kendra (AMK) which continues to
take care of the needs of special children from rural areas around
Ropar. AMK is a one-stop centre that meets all the needs of the
children. Professionally trained and experienced personnel provide
functional academics and services like occupation and speech therapy,
pre-vocational and vocational training and help each child attain their
highest potential to equip them to face the challenges of life.
The children of AMK have taken a special liking to sports. They have
constantly been giving stellar performances in state, national and
international level sports competitions.
Our new premise has enabled us to plan for expanding our facilities and
will consequently reach out to much larger group of children.
We empower women to take on new community projects
Our communities are actively involved in the welfare of women folk.
Today, we have about 440 self-help groups (SHGs) actively functioning
at various locations with over 5000 women taking active participation.
We partner with organizations like the National Bank for Agriculture
and Rural Development (NABARD) for their livelihood training programmes
for skill development and entrepreneurship development.
The women have access to micro credit that has made them vocal and
participating members not just of their communities, but within their
families. Many of them are now engaged in activities that generate
alternate incomes.
These empowered women are also our most willing grass-root force in
piloting and establishing new community projects.
In the coming year, we hope to continue working with our people,
thereby contributing to the United Nations Millennium Developmental
Goals.
HUMAN RESOURCE
We continue to empower our people
Building organizational capabilities has been the central theme for all
our HR initiatives. A formal employee survey was conducted during the
year to identify the characteristics of our organization that has made
us distinctive and successful and to identify specific areas where we
can improve ourselves, especially in comparison to our competition.
Quite appropriately, therefore the “People Power” project has been
initiated by the company, and as the name suggests, aims at empowering
people through initiatives related to talent management, organization
structure and processes.
Global HR practices related to talent assessment techniques are being
used to assess our talent and develop leadership skills for future
challenges. Career planning is being given a fresh impetus with
emphasis on overall development in different functional areas. Multiple
projects are being implemented within the company that provide new
developmental opportunities to our people in inter-disciplinary areas.
Performance management as an ongoing activity is well established in
the organization with larger and deeper involvement of employees across
all levels and an objective mechanism for assessment and feedback. The
employee development aspect of Performance Management Systems (PMS)
provides a meaningful linkage to leadership training.
Global HR systems and processes related to talent development and
compensation management will enable the organization to realize its
people potential and develop capabilities for future growth.
EMPLOYEE STOCK OPTION SCHEME
The company has granted Stock Options to the Managing Director, Whole-
time Directors and employees, for the eighth year in succession. The
particulars required to be disclosed pursuant to Clause 12 of SEBI
(Employees Stock Option
Scheme) Guidelines 1999 , are given in subsequent paragraphs.
a) ESOS 2007 (For the Financial Year ended 31st December 2006)
During the year 2007, the company granted 73,86,750 stock options on
7th June, 2007 (each option carrying entitlement for one share of the
face value of Rs.2/- each) to the Managing Director, Whole-time
Directors and employees including some employees of subsidiary
companies, at an exercise price of Rs.113.00 per share. The market
price of the shares on the date of grant was Rs.109.55 per share. These
stock options shall vest on expiry of one year from the date of grant
and can be exercised during a period of four years from the date of
vesting. The exercise price was determined by averaging the daily
closing price of the company’s equity shares during 7 days on the
National Stock Exchange, immediately preceding the grant.
The company has adopted intrinsic value method for the valuation and
accounting of the stock options as per SEBI guidelines. Since the
market price per share on the previous day of the date of grant was
less than the exercise price, no employee compensation cost has been
accounted for the year ended 31st December, 2007. The fair value of the
options as per the “Black Scholes” model comes to Rs.29.28 per option.
Had the company valued and accounted the options as per the “Black
Scholes” model, the net profit for the year would have been lower by
Rs.20.88 crore and the diluted earning per share (with face value of
Rs.2 each) would have been Rs.11.48 instead of Rs.11.61 per share.
The Black Scholes” model captures all the variables with their
respective appropriateness which influences the fair value of stock
options. The significant assumptions to estimate the fair value of
options as per “Black Scholes” model are: 1. Risk-free interest rate –
7.89%.
2. Expected life of the option – 3 years.
3. Expected volatility – 33.73%.
4. Expected dividend yield – 2.22%.
None of the options granted during the year have vested till date. No
employee or Director has been granted options in excess of 1% of the
issued equity share capital of the company. None of the Directors has
been granted options of more than 5% of the total options granted
during the year.
The options granted to the Managing Director, Whole-time Directors and
other senior management personnel are as follows:
Mr. A. L. Kapur 250000
(appointed as Managing Director w.e.f. 01.05.2007)
Mr. P. B. Kulkarni 250000
Mr N. P. Ghuwalewala 175000
Mr. B. L. Taparia 125000
Mr.R.R.Darak 50000
Mr.Anil Kaul 50000
Mr.H.S.Patel 50000
Mr.V.P.Sharma 50000
1000000
The other employees have been granted 63,86,750 options. The details of
options granted to other employees are:
Total number of employees 2702
Total number of options granted 6386750
Max. number of options granted 50000
Min. number of options granted 300
Avg. number of options granted 2364
1,13,250 stock options have been reserved to be granted to the SAP core
team later.
b) Cumulative disclosure
The particulars with regard to the stock options as on 31st December,
2007 as required to be disclosed under the SEBI’s guidelines are as
follows:
CORPORATE GOVERNANCE
The company has complied with the Corporate Governance Code as
stipulated under the listing agreement with the stock exchanges. A
separate section on corporate governance, along with a certificate from
the auditors confirming the compliance is annexed and forms part of the
Annual Report.
DIRECTORS
Resignation
Mr. Anil Singhvi resigned from the Board on 30th April 2007. The Board
placed on record its appreciation for the valuable services rendered by
Mr. Singhvi during his tenure.
Retirement by rotation
(i) Mr. P. B. Kulkarni, (ii) Mr. N. P. Ghuwalewala and (iii) Mr. B. L.
Taparia Directors of the company retire by rotation, as per Article 147
of the Articles of Association of the company. Being eligible, they
have offered themselves for re-appointment.
Further details about Directors are given in the Corporate Governance
Report as well as in the Notice of the ensuing Annual General Meeting
being sent to the shareholders along with Annual Report. The board of
directors recommends their re-appointment.
DIRECTORS’ RESPONSIBILITY
Pursuant to Section 217 (2AA) of the Companies Act, 1956 as amended,
the Directors confirm that:
i) In the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanations relating to
material departures.
ii) Appropriate accounting policies have been selected and applied
consistently, and judgments and estimates made are reasonable and
prudent, so as to give a true and fair view of the state of affairs of
the company as on 31st December, 2007, and of the profit and cash flow
of the company for the period ended 31st December, 2007.
iii) Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities.
iv) The annual accounts have been prepared on a going concern basis.
AUDITORS
The updation of the Fixed Assets Register at Ambujanagar as referred by
the Auditors in their Report (refer para (i)(a) of the Annexure to
their Report) shall be completed at the earliest within the current
year.
M/s. S. R. Batliboi & Associates, auditors of the company will retire
at the ensuing Annual General Meeting and are eligible for re-
appointment. M/s. S. R. Batliboi & Associates have confirmed that their
re-appointment, if made, shall be within the limits of Section 224 (1B)
of the Companies Act, 1956.
The Board recommends their re-appointment as Auditors and to fix their
remuneration.
M/s. P. M. Nanabhoy & Co., Cost Accountants, have been appointed
Cost Auditors of the company for the year 2008.
TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND
The company has transferred a sum of Rs.0.12 crore during the financial
year 2007 to the Investor Education and Protection Fund established by
the Central Government, in compliance with Section 205C of the
Companies Act, 1956. The said amount represents unclaimed dividend
which have been with the company for a period exceeding 7 years from
their respective due dates of payment.
ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE
Information on conservation of energy, technology absorption, foreign
exchange earnings and outgo is required to be given pursuant to Section
217 (1) (e) of the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rules, 1988 is annexed hereto marked Annexure – I and forms part of
this report.
PARTICULARS OF EMPLOYEES
Information required to be given pursuant to the provisions of Section
217 (2A) of the Companies Act, 1956 read with Companies (Particulars of
Employees) Rules, 1975 is annexed hereto marked Annexure - II and forms
part of this report.
SUBSIDIARY COMPANIES
(a) Additions
The company purchased, (i) 9990 equity shares (99.90%) of Rs.100.00
each @ Rs.100 per share for Rs.0.10 crore in the paid up equity share
capital of Chemicals Limes Mundwa Pvt.Ltd., and (ii) 450010 equity
shares (99.99%) of Rs.10.00 each in the paid up equity capital of
M.G.T. Cements Pvt.Ltd. at Rs.40.55 per share for Rs.1.82 crore.
Both the companies together own 69.11 bighas of land on outright
ownership and 35.2 bighas Government land on lease at Marwar Mundwa
(Rajasthan) in close proximity to where the company proposes to set up
a cement plant.
(b) Cessations
Indo Nippon Special Cements Limited
which was a wholly owned subsidiary of the company was amalgamated with
the Company w.e.f. 1st July, 2005 pursuant to the order passed by the
Hon’ble High Court of Gujarat on 9th January 2007 and hence has ceased
to be a subsidiary company. The effect of the amalgamation has been
given in the books of the company for the year ended on 31st December,
2007.
(c) Annual Reports
Ministry of Corporate Affairs, Government of India, vide its letter
dated 7th February, 2008 has exempted the company from attaching the
Annual Reports and other particulars of its subsidiary companies along
with the Annual Report of the company required u/s 212 of the Companies
Act, 1956. Therefore, the said Reports of the subsidiary companies viz.
(1) Ceylon Ambuja Cements (P) Ltd., (2) Midigama Cements (Pvt) Ltd.,
(3) Kakinada Cements Ltd., (4) Chemical Limes Mundwa Pvt.Ltd., and (5)
M.G.T. Cements Pvt.Ltd. are not attached herewith. However, a statement
giving certain information as required vide aforesaid
exemption letter dated 7th February, 2008 is placed along with the
Consolidated Accounts. The company shall provide the copy of Annual
Report and other documents of its subsidiary companies as required u/s
212 of the Companies Act to the shareholders upon their request, free
of cost.
CONSOLIDATED FINANCIAL STATEMENTS
As stipulated by Clause 32 of the listing agreement with the stock
exchanges, the consolidated financial statements have been prepared by
the company in accordance with the applicable accounting standards
issued by The Institute of Chartered Accountants of India. The audited
consolidated financial statements together with Auditors’ Report form
part of the Annual Report.
The consolidated net profit of the company, its subsidiaries and
associates amounted to Rs.1846.11 crore for the corporate financial
year ended on 31st December, 2007 as compared to Rs.1769.10 crore of
the company.
EMPLOYMENT OF PERSONS OF SC/ST BACKGROUND
The company has always provided a congenial atmosphere for work to all
sections of the society. It has provided equal opportunities of
employment to all including persons with SC/ST background.
AWARDS AND RECOGNITION
(a) Asian Institute of Management, Philippines, conferred on the
company the “Asian CSR Award 2007” in the “Concern for Health” category
for its robust programme on health and HIV/AIDS for the welfare of the
communities.
(b) Greentech Environment Excellence Gold Award - 2007 was awarded to
the company for outstanding achievement in Environmental Management for
Himachal Unit by Greentech Foundation, New Delhi.
(c) Our mines continued to be adjudged among the best mines in their
respective regions by the Directorate of Mines in recognition of our
efforts in afforestation, pollution control, safety, best mining
practices, etc.
(d) Indian Institute of Materials Management conferred the “Corporate
Excellence Award, 2007” for the company’s overall performance
particularly in the fields of company visibility, brand image, and
contribution to corporate social responsibility.
(e) Construction World M.B.A. Trophy for 1st rank was awarded to the
company for being the largest and most profitable cement company for
the year 2007.
(f) CAPEXIL, an export promotion council, sponsored by the Ministry of
Commerce has once again conferred the “Top Export Award” to the company
for its outstanding export performance for the year 2006-07.
(g) The Company was adjudged as the top Indian company in the cement
sector for the Dun and Bradstreet - American Express Corporate Awards
2007.
(h) The Government of India has conferred the honour of Padma Bhushan
to the companys Chairman Mr. Suresh K. Neotia for his outstanding
contribution to the Indian business and industry.
ACKNOWLEDGEMENTS
We would like to take this opportunity to express our deep sense of
gratitude to the banks, central and state governments and their
departments and the local authorities for their continued guidance and
support.
We would also like to place on record our sincere appreciation for the
total commitment, dedication and hard work put in by every member of
the Ambuja family.
To them goes the credit for the company’s achievements.
And to you, our shareholders, we are deeply grateful for the confidence
and faith that you have always reposed in us.
For and on behalf of the Board,
Suresh Neotia
Chairman
Mumbai, 12th February, 2008
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