India Cements is hopeful of significantly improving its operating performance having initiated necessary actions to reduce the variable cost and improve the liquidity position and become a modern and efficient cement producer. Company vice-Chairman and Managing Director N.Srinivasan told shareholders at the 77th Annual General Meeting of the Company held on Thursday through video conferencing that last year, despite the good demand, the performance was severely dented due to significant increase in input cost. The setback in performance was also due to its operating plants of different age, supply overhang, severe competition and subdued price realisation. Mr. Srinivasan, who chaired the meeting said, “We are focused on lifting the fortunes of our core business, cement. We know the cement industry the best. The Company has copious limestone deposits”. He told shareholders,” It ( Company) has wealth of experience in cement manufacturing, having long serving professionals and experts across the functions and extensive network for marketing cement. Though cyclical in nature, the industry has immense potential for growth with the focus on infrastructure development by the Centre and States and the growing demand for housing”. Referring to the improved performance during the third quarter of this year, he said the Rs 168 per tonne reduction in variable cost had directly flown to the bottom line resulting in positive EBIDTA during the quarter after three quarters of continued negative EBIDTA.
The Company is seriously pursuing its plan to monetise some of the non-core assets for improving liquidity and operating performance as well as meeting some of the minimum capital expenditure. He said the new Cement Mill at Sankar Nagar, replacing the old cement mills, is expected to be commissioned by the 2nd quarter of the current fiscal. Also, the waste heat recovery system at Chilamkur in Andhra Pradesh is being taken up for completion in the current year and both these projects are expected to bring in substantial relief in variable cost in the two plants. He informed members that in harnessing green energy, India Cements was a pioneer and the first one to set up a waste heat recovery plant in the entire cement industry in 2004 at Vishnupuram, now part of Telangana. It is also exploring opportunities for producing green energy from solar power and for using alternate fuels. The company has engaged FLSmith and ThyssenKrup Industries to conduct a detailed study on the operating parameters of some of its plants for refurbishment/modernisation to bring them in line with that of state of the art modern plants. The company has also engaged Boston Consulting Group to study the operations at 3 of its plants in Andhra Pradesh and Telangana and suggest measures for improving efficiency in their operations. On the marketing front, he said the Company is focused on increasing retail sales. Last year, it went up as the Company benefited from being sponsor of CSK and the good performance of the team. As part of strengthening its sales and marketing force, he said, the company has revamped the marketing team with change of guards at various levels.
It has taken up a series of marketing and brand promotion drive with renewed focus on achievement of targets on sales, collection and market development. The Company has also launched slew of ground level activities for connecting with its consumers, dealers, stockists and influencers like engineers, contractors and masons. They are regularly taken to its plants to understand the best practices followed in cement manufacturing process and the focus on maintaining consistent high quality. Highlighting the Company’s HR philosophy which strongly believes in the concept of good people making a good organisation, Srinivasan said it is known for its strong focus on maintaining cordial relationship, team building, enhancing leadership qualities and encouraging the workforce to grow along with the organisation. “Our Company, known for its established tradition of maintaining cordial industrial relations with workmen, amicably reached an important new tripartite four year wage settlement with recognised trade unions across the company on January 13, 2023.