FINANCIAL ANALYSIS / HIGHLIGHTS

FINANCIAL ANALYSIS OF ACC LIMITED (STANDALONE)

1. Net Sales:
Figures in Rs. Crore
2009 2008 Change Change%

Sale of Products and Services (Gross) 8,724.24 8,234.02 490.22 5.95%

Less - Excise Duty 697.04 951.15 (254.11) -26.72%

Sale of Products and Services (Net) 8,027.20 7,282.87 744.33 10.22%

The net sales increased by 10.22% during current year over previous year mainly due to higher cement realization.
Cement volumes increased by 2.43% during the current year which can be seen from the following table:
Figures in million tonnes
2009 2008 Change Change%

Cement 21.52 21.01 0.51 2.43%

Clinker 2.02 3.99 (1.97) -49.37%

2. Other Inc ome:

Income:
Figures in Rs. Crore
2009 2008 Change Change%

Other operating income 163.70 165.53 (1.83) -1.11%

Other income 77.41 123.18 (45.77) -37.16%

Other operating income comprises sale of stores, materials etc., sale of surplus generated power, provision no longer
required written back etc. The other operating income has decreased marginally by 1.11% during current year as compared
to previous year.
During the current year, other income is decreased by 37.16% as compared to previous year, primarily on account of
decrease in interest income by Rs. 38.02 Crore due to lower amount of interest on Fixed Deposits with bank, due to higher
interest on income tax refund in the previous year and also on account of lower dividends from long term investment by
Rs. 7.60 Crore.

3. Purchase of C
urchase emen
Cemen t:
ement:
Figures in Rs. Crore
2009 2008 Change Change%

Purchase of Cement 93.16 87.36 5.80 6.64%

During the current year there is marginal increase in purchase of cement for trading purpose.

4. Raw Materials C
Materials onsumed:
Consumed:
Figures in Rs. Crore
2009 2008 Change Change%

Raw Materials Consumed 891.51 799.12 92.39 11.56%

The raw materials consumption of the Company increased by 11.56 % over the previous year mainly due to higher prices of
Gypsum and Slag consumed.

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5. Packing Materials C
Materials onsumed:
Consumed:
Figures in Rs. Crore
2009 2008 Change Change%
Packing Materials Consumed 238.72 280.14 (41.42) -14.79%
There is significant reduction of 14.79 % in Packing Material consumed due to decrease in the price of bags consumed for
despatch of cement.

6. Pow er and FFuel:

ower uel:
Figures in Rs. Crore
2009 2008 Change Change%
Power and Fuel 1,539.65 1,598.96 (59.31) -3.71%
There is increase in the price of indigenous coal and imported coal but cost of Power and Fuel consumption has
decreased as compared to previous year on account of optimization of coal mix and lesser consumption of coal per unit
of power.

7. Repairs:
Figures in Rs. Crore
2009 2008 Change Change%
Repairs 405.31 361.85 43.46 12.01%
Expenditure on account of repairs has increased by 12.01% due to consumption of refractories, liners, grinding media,
spare parts, maintenance materials and other third party maintenance services.

8. Royalty
alty::
Figures in Rs. Crore
2009 2008 Change Change%
Royalty 98.39 86.69 11.70 13.50%

There is increase in royalty paid on limestone as royalty rate has increased from Rs. 45 to Rs. 63 per tonne
w.e.f. 13th Aug 2009.

9. Payments to and Pr
yments ovisions ffor
Pro or Employees:
Employ
Figures in Rs. Crore

2009 2008 Change Change%

Payment and provision for employees 367.71 416.32 (48.61) -11.68%
There is increase in employee cost on account of annual increment, Hay grade implementation for aligning the remuneration
with current market and compensation paid under Voluntary Retirement Scheme. During the current year, the Company
has recognized a credit of Rs. 26.61 Crore (Previous Year charge of Rs. 34.13 Crore) due to change in discounting rate in
valuation of present value of employee benefit liabilities as per Accounting Standard 15 (Revised) - “Employee Benefits”
notified pursuant to the Companies (Accounting Standards) Rules, 2006.

10. Loading
oading,, Transpor ta
ansporta tion and other char
tation ges:
charges:
Figures in Rs. Crore
2009 2008 Change Change%
Loading, Transportation and other charges 169.69 176.98 (7.29) -4.12%
Cost of Loading, Transportation and other charges has marginally decreased as compared to previous year.
During the current year there is no major variance in C&F charges (decreased by Rs. 2 per tonne in the current year) as
compared to previous year.

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 11. Disc oun
Discoun t, R
ount, eba
Rebates and Allow
ebates ances:
Allowances:
Figures in Rs. Crore
2009 2008 Change Change%

Discount, Rebates and Allowances 93.49 105.20 (11.71) -11.13%

The cost of Discount, Rebates and Allowances has decreased by 11.13 % on account of discontinuation of one of discount
scheme.

12. Rates and Taxes:

axes:
Figures in Rs. Crore
2009 2008 Change Change%

Rates and taxes 101.45 98.75 2.70 2.73%

An increase in additional goods tax in the state of Himachal Pradesh, partly nullified by a reduction in entry tax in the
state of UP, has lead to an overall impact increase by 2.73% in the rates and taxes.

13. Adver
Adver tisemen
ertisemen t:
tisement:
Figures in Rs. Crore
2009 2008 Change Change%

Advertisement 53.16 47.56 5.60 11.77%

There is increase in advertisement expenditure by 11.77% as compared to previous year on account of new facilities.

14. Outw d FFrreigh

ard
Outwar
ar eightt Charges on C
Charges emen
ementt etc:
Cemen
Figures in Rs. Crore
2009 2008 Change Change%

Outward Freight Charges on Cement etc 1,054.41 1,001.58 52.83 5.27%

There is increase in cost of Outward freight charges on cement due to increase in railway freight for cement w.e.f. December
2008 and the variation between the rates is 7%.

15. Other EExpenses:

xpenses:
Figures in Rs. Crore
2009 2008 Change Change%

Excise Duties (Net) 84.54 117.08 (32.54) -27.79%

Rent 32.59 33.22 (0.63) -1.90%

Insurance 17.60 17.86 (0.26) -1.46%

Stores and Spare parts Consumed 10.03 13.86 (3.83) -27.63%

Commission on Sales 23.12 20.24 2.88 14.23%

Other Expenses 270.48 286.55 (16.07) -5.61%

Provision for Bad and Doubtful Debts 31.26 0.71 30.55 4302.82%

TOTAL 469.62 489.52 (19.90) -4.07%

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 There is decrease in excise duty charges due to reduction in excise rate on clinker consumed for captive consumption at
exempted units.
During the current year, there is marginal decrease in rent cost as compared to previous year.
As compared to previous year there is a reduction in the consumption of stores and spares consumed by Rs. 3.83 Crore.
During the current year, the Company has introduced cost reduction initiatives as a result of which there is decrease in
other expenses as compared to previous year.
During the current year, provision is made of Rs. 29 Crore in respect of sales tax incentive available under a state government
policy in respect of one of its cement plants as compared to previous year.

16. Depr ecia

Deprecia tion:
eciation:
Figures in Rs. Crore
2009 2008 Change Change%
Depreciation 342.09 294.18 47.91 16.29%
There is increase in depreciation on account of asset capitalization of Rs. 1,005.71 Crore as compared to Rs. 492.02 Crore in
the previous year.
During the current year, there is commissioning of major portion of Bargarh expansion / modernization project along with
captive power plant and grinding plants at Kudithini and Thondebhavi with capacity of 1.1 MTPA and 1.6 MTPA respectively.

17. Inter
Inter est Char
terest ges:
Charges:
Figures in Rs. Crore

2009 2008 Change Change%

Interest Charges 84.30 39.96 44.34 110.96%
Interest charges comprise interest on debenture, term loans, interest on income tax and other interest.
The Company has raised Rs. 500 Crore (Rs. 200 Crore in the previous year in the month of Dec 08) through private
placement of secured non-convertible debenture. The interest charges on debentures have been capitalised of Rs. 26.38
Crore as compared to Rs. 1.36 Crore in the previous year. Further during the current year, in the month of December 09 the
Company has repaid the rupee Term loan of Rs. 200 Crore. During the Current year, there is significant increase in other
interest charges as compared to previous year mainly due to interest claim on delayed payment of royalty on limestone
relating to earlier years worth Rs. 22.43 Crore. The Company has filed a writ petition in the High Court of Shimla challenging
the said claim. Further during the current year the Company has provided interest on income tax of Rs. 17.58 Crore.

18. Exceptional Items:

Figures in Rs. Crore

2009 2008 Change Change%

Exceptional Items — 48.86 (48.86) -100.00%
There are no exceptional items as compared to previous year which includes profit on sale of investment in ACC Machinery
Company limited and sale of land at Sanatnagar.

19. Fixed Assets:

ixed
Figures in Rs. Crore

2009 2008 Change Change%

Net Fixed Assets 4,158.29 3,469.70 688.59 19.85%
Capital Work in progress 2,156.21 1,602.86 553.35 34.52%
Net Fixed Assets increased by 19.85% as compared to previous year mainly due to commissioning of major portion of
Bargarh expansion / modernization project along with captive power plant with an incremental capacity of 1.1 MTPA and
grinding plants at Kudithini and Thondebhavi with capacity of 1.1 MTPA and 1.6 MTPA respectively.

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 Capital work in progress increased by 34.52% as compared to previous year mainly due to expenditure incurred as part of
the on-going expansion / modernization projects at Wadi, Chanda and others.

20. In
Invvestments:
estments:
Figures in Rs. Crore
2009 2008 Change Change%

Investments 1,475.64 679.08 796.56 117.30%

There is increase in Investments mainly on account of subscription of 1% cumulative Redeemable Preference Shares of
Rs. 100 Crores in ACC Concrete Limited, acquisition of 100% stake in National Limestone Company Pvt. Ltd (a Company
engaged in mining of limestone) and subscription of Rs. 4.90 Crore of Equity shares in ACC Mineral Resources Limited.
There has also been a substantial increase in the investment of mutual funds as compared to previous year. As on December
31, 2009 the Company invested Rs. 1,129.47 Crore in mutual funds out of the cash surplus / internal accrual lying with the
Company.

21. Stock-in-tr
Stock-in-trade and Stor
-in-trade es & Spar
Stores es:
Spares:
Figures in Rs. Crore
2009 2008 Change Change%

Stock-in-trade and Stores & Spares 778.98 793.27 (14.29) -1.80%

The Stock-in-trade as on 31st December, 2009 was lower than the level of 31st December, 2008 by Rs. 14.29 Crore mainly on
account of decrease in inventory of imported coal. Further the raw materials inventory was higher than last year due to a
significant increase in the prices of Gypsum.

22. Sundr
Sundryy Debtors:
Figures in Rs. Crore
2009 2008 Change Change%

Sundry Debtors 203.70 310.17 (106.47) -34.33%

There is decrease in Sundry Debtors by 34.33% as compared to previous year. During the year provision is made of Rs. 29.44
crore in respect of sales tax incentive as well as Rs. 15 Crore on account of Capital Subsidy as receivable under a state
government policy in respect of one of its cement plants.
A days sale outstanding for cement customer third party as on 31st December, 2009 is 2.95 as compared to 4.45 as on 31st
December, 2008.

23. Other Curren

entt Assets:
Curren
Figures in Rs. Crore
2009 2008 Change Change%

Other Current Assets 10.99 20.67 (9.68) -46.83%

Other current assets comprises accrued interest and asset held for disposal. Accrued interest includes interest on fixed
deposits and government securities. During the current year, the other current assets have gone down due to decrease in
accrued interest on fixed deposit as compared to previous year..

24. Loans and Advances:

Advances:
Figures in Rs. Crore
2009 2008 Change Change%

Loans and Advances 554.42 651.28 (96.86) -14.87%

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 Loans and advances decreased mainly due to realization of inter corporate deposit of Rs. 100 crore given to ACC Concrete
Limited, a wholly owned subsidiary of the Company.
During the current year, there is an increase in balance with excise, customs ports and other authorities by Rs. 9 crore on
account of availment of cenvat credit on capital items, on account of on-going CAPEX projects at Kudithini, Thondebhavi,
Wadi, Chanda and Bargah plants and the same will be utilized in the next year since Company has registered itself under
the Large Tax Payer Unit (LTU) w.e.f. October 1, 2009.

25. Curren
entt Liabilities:
Curren
Figures in Rs. Crore
2009 2008 Change Change%

Current Liabilities 2,060.34 1,801.79 258.55 14.35%

Current liabilities have increased by 14.35% as compared to previous year primarily on account of higher provision for
marketing and sales expenses, which in turn is arising out of higher sales during the year and increase in provision for
expenses in line with the increase in turnover etc.

26. Pr
Proovisions:
Figures in Rs. Crore
2009 2008 Change Change%

Provisions 1,091.88 963.93 127.95 13.27%

During the current year provisions have increased on account of provision of proposed dividend of Rs. 13 per share as
compared to Rs. 10 per share in the previous year. Liability has also increased on account of provision for income tax,
further provision in respect of retirement benefits has decreased on account of change in discounting rate.

27. Loan FFunds:

unds:
Figures in Rs. Crore
2009 2008 Change Change%

Secured Loans 550.00 450.00 100.00 22.22%

Unsecured Loans 16.92 32.03 (15.11) -47.17%

There is increase in secured loans primarily on account of issuance of Rs. 300 Crore secured non-convertible debentures in
the month of October 2009. During the current year, rupee term loan of Rs. 200 Crore has been repaid in the month of
December 2009.
During the current year, unsecured Loans have been decreased on account of repayment of loan taken from KRDCL.

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