SHREE CEMENT Founded in 1979 at Jaipur1, Shree Cement is presently the biggest cement manufacturer in North India.

The company was promoted by the members of the Bangur family. Apart from cement it also produces and sells power under the name Shree Power (Captive Power Plant) and Shree Mega Power (Independent Power Plant). It had a turnover of INR 5989 Crore in FY 2011-12 (15 Months). It presently has a production capacity of 13.5 MTPA. It has plans to raise it further and has already undertaken the work of setting up two clinker manufacturing unit of capacity 2 MTPA at Rajasthan.

Board of Directors
The company is headed by a 10 member board of directors headed by Mr. B.G. Bangur who is the chairman of the company.

Mission, Vision and Philosophy2

To drive and sustain industry leadership of the company within a global context-by developing individual Leadership competencies at every level, through a robust backbone of trust, support, innovation and reward Mission: 1. To harness sustainability through low carbon philosophy To sustain its reputation as one of the most efficient manufacturers globally

To continually have most engaged team To drive down cost through innovative practices

To continually add value to its products and operations meeting expectations of all its stakeholders To continually build and upgrade skills and competencies of its human resource for growth To be a responsible corporate citizen with total commitment to communities in which it operates and society at large

Philosophy: Quality and Energy Conscious Environment and Employee Friendly Socially Responsive Customer Responsive Investors Rewarding Sustainable Organisation

Cement Business
Plants3: The company has five cement manufacturing plants. The details of the plants have been tabulated below-

Source: http://economictimes.indiatimes.com/shree-cements-ltd/infocompanyhistory/companyid13129.cms 2 Source: http://www.shreecement.in/vision-and-mission.html 3 Source: Corporate Presentation

Location Beawar Ras Khushkhera Suratgarh Roorkee Jaipur Total

Capacity 3.0 mtpa 3.0 mpta 3.0 mtpa 1.2 mtpa 1.8 mtpa 1.5 mtpa 13.5 mpta

The growth story4 The following charts indicate the rapid growth of the company.
160 140 120 100 80 60 40 20 0 7000 6000 5000 4000 Cement Clinker 3000 2000 1000 0
2710.6 2109.1 3632.1 3453.5 5898.1

Net Turnover

Figure 1: Cement and Clinker Production (in Lac Ton)

Figure 2: Net Turnover (in Cr)

60 50 40 30 20 10 0 ROE

50 40 30 20 10 0 Net Profit margin EBIDTA Margin

Figure 3: Return on Equity

Figure 4: EBIDTA and NET PROFIT Margin

Source: Company Annual Reports and Corporate Presentation

14 12 10 8 6 4 2 0 Production capacity

12000 10000 8000 6000 4000 2000 0 IRR

Figure 5: Production Capacity in MTPA

Figure 6: IRR over the years

Product Portfolio: The company strongly believes in creating strong brands and have used branding strategies to outdo its competitors. While most of the players are focussed on consolidating their portfolio, they have diversified under three independent brands- Shree Ultra Red Oxide, Bangur Cement, Rockstrong Cement. The benefits of doing this has been manifold like satisfying multiple customer sections by customizing to their specific requirements and having a higher and more dominant brand presence in retail outlets which has helped the company acquire major share of the market in North India. They have strategically positioned their brands so that they dont cannibalize each other. Markets Classification5:

Primary : Rajasthan Secondary : Delhi, Punjab, JK, Haryana, Western U.P. and Uttaranchal Tertiary: Gujarat, M.P. and Central U.P.

There has been a shift from Product Centric to Consumer centric in the last few years and Shree Cement has started marketing all its products very aggressively. It enjoys a market share of 17 percent in Northern India. A few highlights6: First company in the World to utilize 100% Petcoke in all its operations - Both Cement and Power plants. First Cement company in India to produce Synthetic Gypsum to replace use of natural gypsum in cement manufacturing. First Cement company in India to be given 4 star rating by Whitehopleman UK. Fastest stabilization of cement kilns after commissioning. First Cement company in World to fetch Certified Emission Reductions (CERs) on its Clean Development Mechanism project Optimal Utilization of Clinker.

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Source: Wikipedia Source: Corporate Presentation, Annual Report

First Indian cement company to issue Corporate Sustainability Report following the highest level A+ for reporting triple bottom line performance.

Outlook: During the first 6 months of 2011-12, the general economic slowdown, high interest rates, less government spending coupled with good monsoon impacted real estate, infrastructure and other construction projects resulting in moderation of cement demand growth to around 3%. The company expects the industry to grow in tandem with the national economic growth in the medium to long term. Keeping in view the expected growth, company has decided to increase its cement capacity further. Considering the existing land that is available at its existing sites at Beawar and Ras it has decided to set up clinker plants at these locations and grinding plants at existing and new places. Company is going to set up two clinker manufacturing units of combined capacity of 2 MTPA at Ras. Company has sufficient limestone reserves to meet its present as well as future needs. The company is also setting up a grinding unit in Bihar and Chattisgarh.

Power Business
The story of power of Shree is a case of successful experimenting and then scaling up to create and capitalize on opportunities. Their first power plant was a 36 MW captive power plant at Beawar, Rajasthan. The next leap in their power production came when the company started transmitting its captive power to their grinding unit at Khushkhera. Soon they started to expand their power capacity well beyond the captive requirements. With this the commissioning of Shree Mega Power happened. It is a 300 MW plant which is known for its operational excellence. The growth story7
700 600 500 400 300 200 100 0 600 500 400 300 Power Sale 200 100 0 Power Capacity (MW)

Figure 6: Power sale in Cr

Figure 7: Power Capacity in MW

Shree Mega Power8 Company came up with idea of Independent Power Plant in 2009 seeing the upcoming market and requirement in Power Sector. It has 2X150 MW (300MW Total) Unit in Beawar location only (2km from existing Cement Unit). This Unit has a world record for fastest erection and commissioning (21 months, earlier record was 27 months) and also the smallest area to plant capacity ratio, utilizing the

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Source: Annual Report and Corporate Presentation Source: Wikipedia

land. This unit has largest and first air cooled condenser for such a capacity. It is known to be operational till now. Shree Power The company has installed 120 MW captive power plants split into two locations (Beawar & Ras) to meet its complete power needs of 15 million tonne Integrated Cement Plant. It has commissioned a 2x18 MW Greenfield Power Plant at Beawar in 2002 which is running successfully. One 6 MW TG is also operating successfully with excess steam available from this 2x18 MW Power Plant. 4x18 unit is operational in RAS plant (40km from Beawar). At same location 2x50 MW unit also exists and being fully operational. Company also believes in producing power from waste heat recovery methods (from Cement Kiln and preheat) making a total of 265MW captive power along with 300MW independent. Outlook9 India continued to face high deficit in terms of both peak and base energy. The peak and base deficit were at 11.1 % and 8.5% in 2011-12. Greater participation from private sector accelerated new capacity addition but the issue of fuel availability and transmission bottleneck continued. Many coal based plants are forced to operate on costly imported coal as the domestic coal supply is not adequate. The power trading activities undertaken by the Company showed all round growth during the year. Company executed several power trading deals for sale and purchase as well as banking of power for third parties. The power trading volume carried out for third parties including banking transactions during the year increased from 418 Million Units to 1283 Million Units during the year. The commission and other income generated from power trading activities rose to Rs.6.26 Crore during 2011-12 (15 months) vis--vis Rs.2.14 Crore during the previous year. Through its regular update on market trends and happenings and timely interactions with the utilities, the Power Trading activities also helped Company in raising its sales volumes from its own power plants

Source: Company Annual Reports