Indian Cement Industry

Group 5

• Ashutosh Choudhary (1910120007)

• Garima Behl (1910120009)
• Paras Yadav (1910120026)
• Vignesh Shanmugam (1910120041)
• Vikas Yadav (1910120142)
• Vishal Jain (1910120043)
• Vivek Dixit (1910120044)
Industry Overview
• India is the second largest producer of cement in the world
• Recent major initiatives such as development of 98 smart cities are
expected to provide a major boost to the sector
• As of June 2019, cement production capacity stood at 28.3 million tonnes
per annum (MTPA)
• The top 20 cement companies account for almost 70 per cent of the total
cement production of the country
• According to data released by the Department of Industrial Policy and
Promotion (DIPP), cement and gypsum products attracted Foreign Direct
Investment (FDI) worth US$ 5.28 billion between April 2000 and June 2019
Cont.
• The Union Budget has allocated Rs 139 billion (US$ 1.93 billion) for
Urban Rejuvenation Mission: AMRUT and Smart Cities Mission
• As per Union Budget 2019-20, Government is expected to upgrade
1,25,000 kms of road length over the next five years
•  Due to the increasing demand in various sectors such as housing,
commercial construction and industrial construction, cement industry
is expected to reach 550-600 Million Tonnes Per Annum (MTPA) by
the year 2025
• Many foreign players are also expected to enter the cement sector,
owing to the profit margins and steady demand
Introduction

• UltraTech Cement Ltd is the largest manufacturer of grey cement,

ready mix concrete (RMC) and white cement in India. It had
headquarters at Mumbai.
• With 100+ Ready Mix Concrete (RMC) plants in 35 cities, UltraTech is
the largest manufacturer of concrete in India.
• Highest market capitalisation in India’s cement industry
• UltraTech Concrete receives -Innovation for Sustainability- Award at
the Economic Times Innovation Awards
 Chart Title
Capital 140000.00

Structure 120000.00

100000.00

80000.00

60000.00

40000.00

20000.00

0.00
2019 2018 2017 2016 2015

Total Shareholders Fund Long Term Debt

2019 2018 2017 2016 2015

Total Shareholders Fund 118637.56 108470.95 109526.83 87438.57 79030.01

19551.16 15863.47 6370.84 4896.59 4992.66
Long Term Debt
D/E 0.1647974 0.14624625 0.05816694 0.05600034 0.06317423
Dividend

Announcement Date Ex-Dividend Date Record Date Dividend

24-04-2019 10-07-2019 12-07-2019 11.50
25-04-2018 10-07-2018 12-07-2018 10.50
25-04-2017 10-07-2017 12-07-2017 10.00
25-04-2016 04-07-2016 06-07-2016 9.50
27-04-2015 14-08-2015 16-08-2015 9.00
2019 2018 2017 2016 2015
88.65 80.92 98.9 90.3 76.47
EPS

Dividend Per Share 11.5 10.5 10 9.5 9

Dividend Pay-out Ratio 0.14096 0.12315 0.11869 0.10402 0.12534

Dividend Yield 0.01113 0.01093 0.01125 0.01188 0.01297
 Shareholding Pattern
Chart Title
200,000,000

180,000,000

160,000,000

140,000,000

120,000,000

100,000,000

80,000,000

60,000,000

40,000,000

20,000,000

0
2019 2018 2017 2016 2015

Promoter Holding Institutional Holding Public Holding

2019 2018 2017 2016 2015

Promoter Holding 17,09,82,324 16,94,15,082 17,03,51,257 17,08,76,625 17,19,89,809

Institutional Holding 8,84,87,992 7,68,92,533 7,66,01,025 7,45,65,201 7,02,36,652

Public Holding 11,46,89,502 10,50,18,658 10,42,00,664 10,35,93,348 10,24,28,303

 Working Capital

2019 2018 2017 2016 2015

1755.16 11461.31 13325.67 10533.86 8660.35
CA
12857.06 11515.44 8328.61 11618.24 11020.28
CL
Working
Capital -11101.9 -54.13 4997.06 -1084.38 -2359.93
 Working Capital Analysis

2019 2018 2017 2016 2015

DSI 56.37675 66.70089 61.54673 63.05628 77.12358
DSO 21.44385 21.00305 19.49662 21.78242 19.14724
DPO 45.70146 50.39998 47.40641 43.78317 76.77488
CC 32.11913 37.30396 33.63694 41.05553 19.49594
Introduction

• India Cements Ltd is the largest producer of cement in South India.

• The company has four plants in Tamil Nadu and four in Andhra
Pradesh India which cater to all major markets in South India and
Maharashtra.
• They are the market leader with a market share of 28% in the South
India.
• They have a distribution network with over 10000 stockists.
 Chart Title
Capital 6000.00

Structure 5000.00

4000.00

3000.00

2000.00

1000.00

0.00
1 2 3 4 5

Total Shareholders Fund Long Term Debt

2019 2018 2017 2016 2015

Total Shareholders Fund 4221.79 4364.98 4993.19 2647.88 2573.54

Long Term Debt 2691.43 2878.16 2451.49 2126.52 2445.42

D/E 0.637509879 0.659376 0.490967 0.803103 0.950215

Dividend

Announcement Date Ex-Dividend Date Effective Date Dividend

27-05-2019 02-09-2019 04-09-2019 ₹ 0.8
25-05-2018 09-09-2018 11-09-2018 ₹ 0.8
01-06-2017 22-08-2017 24-08-2017 ₹1
26-05-2016 17-08-2016 19-08-2016 ₹1
20-05-2013 04-09-2013 06-09-2013 ₹2
2019 2018 2017 2016 2015
EPS 0.68 2.11 4.92 3.8
-0.108
Dividend Per Share 0.8 0.8 1 1 2

Dividend Pay-out Ratio 0.460685 0.349235 0.201961 0.002148 0.010051

Dividend Yield 0.004726 0.004679 0.005936 0.006082 0.018174
 Shareholding Pattern
Shareholding Pattern
160,000,000

140,000,000

120,000,000

100,000,000

80,000,000

60,000,000

40,000,000

20,000,000

0
2019 2018 2017 2016 2015

Promoter Holding Institutional Holding Public Holding

2019 2018 2017 2016 2015

Promoter Holding 87,421,448 87,423,388 86,933,388 86,933,388 86,726,373

Institutional Holding 96,415,661 130,287,145 143,786,250 137,600,842 127,497,604

Public Holding 125,687,003 90,943,483 75,709,902 80,354,313 89,461,414
 Working Capital

2019 2018 2017 2016 2015

2331.45 1941.2 1948.23 1585.43 1793.19
CA
2508.3 1929.09 2436.16 2665.75 2359.55
CL
Working
Capital -176.85 12.11 -487.93 -1080.32 -566.36
 Working Capital Analysis

2019 2018 2017 2016 2015

DSI 91.35376 82.75032 106.6373 88.31961 84.13522
DSO 91.35376 82.75032 106.6373 88.31961 84.13522
DPO 146.0766 144.7494 188.6578 132.2932 114.4119
CC -7.4458 -18.9793 -49.8716 0.358162 8.18219
Introduction
• Shree Cement is primarily an Indian cement manufacturer.
• Founded in 1979.
• Headquarter- Kolkata.
• Among the top 3Cement Group in India(In terms of Cement Capacity).
• Among the top 50 Listed Companies in India.
• 1st Overseas acquisition of Union Cement Company in Emirate of Ras-
al-Khaimah, United Arab Emirates.
• Largest waste heat recovery based power plants(Excluding China).
Capital Structure
Chart Title
80000.00

70000.00

60000.00

50000.00

40000.00

30000.00

20000.00

10000.00

0.00
2019 2018 2017 2016 2015

Total Shareholders Fund Long Term Debt

2019 2018 2017 2016 2015

Total Shareholders Fund 71762.94 65032.91 59513.13 43269.58 37602.60
2437.78 2230.26 536.96 534.35 401.41
Long Term Debt
D/E 0.033969899 0.034294 0.009023 0.012349 0.010675
 Dividend
Announcement Date Ex-Dividend Date Effective Date Dividend
08-05-2019 17-06-2019 19-06-2019 ₹ 7.00
27-04-2018 16-07-2018 18-07-2018 ₹ 6.00
27-04-2017 19-06-2017 21-06-2017 ₹ 6.00
29-04-2016 16-07-2016 18-07-2016 ₹ 6.00
30-04-2015 20-07-2015 22-07-2015 ₹ 6.00

2019 2018 2017 2016 2015

EPS 288.86 397.29 384.35 437.47 122.36
Dividend Per Share 7 6 6 6 6
Dividend Pay-out Ratio 0.201314 0.110629 0.040303 0.413741 0.113485
Dividend Yield 0.002522 0.00235 0.002716 0.003054 0.003962
 Shareholding Pattern
25,000,000

20,000,000

15,000,000

10,000,000

5,000,000

0
2019 2018 2017 2016 2015
Promoter Holding Institutional Holding Public Holding

2019 2018 2017 2016 2015

Promoter Holding 2,25,69,797 2,25,69,797 2,25,69,797 2,25,69,797 2,25,69,797
Institutional Holding 66,83,863 1,02,76,535 1,01,89,533 1,01,41,348 1,01,04,467
Public Holding 55,83,565 19,90,893 20,77,895 21,26,080 21,62,961
 Working Capital

2019 2018 2017 2016 2015

4719.22 5700.25 3282.19 1808.69 2232.25
CA
2126.58 2967.15 1989.02 1161.72 1448.64
CL
Working
Capital 2592.64 2733.1 1293.17 646.97 783.61
 Working Capital Analysis

2019 2018 2017 2016 2015

DSI 83.54867 112.5641 113.7272 74.70358 114.3952
DSO 22.80549 17.04714 14.23255 21.75447 26.94359
DPO 23.70152 52.17555 30.42647 23.57334 36.39916
CC 82.65264 77.43568 97.53332 72.88471 104.9397
Introduction
• J K Cement is one of the leading manufacturers in the sector of
cement manufacturing in North India founded in May 1975.
• J K Cement enjoys certain vital advantages that have helped them in
becoming one of the leading names in the field of cement
manufacturing in India and abroad.
•  The Company is the second largest manufacturer of white cement in
India, with an annual capacity of 600,000 tones in India.
• Company has Rs 43851.32 Lac working capital which is 31.54% of
current assets.
 Chart Title
Capital 20000.00

Structure 18000.00

16000.00

14000.00

12000.00

10000.00

8000.00

6000.00

4000.00

2000.00

0.00
2019 2018 2017 2016 2015

Total Shareholders Fund Long Term Debt

2019 2018 2017 2016 2015

Total Shareholders Fund 17849.61 7097.97 6537.85 4723.59 4657.85

Long Term Debt 2439.79 2574.11 2870.14 2871.07 2730.09

D/E 0.136685888 0.362655 0.439004 0.607816 0.586126

Dividends
Announcement Date Ex-Dividend Date Effective Date Dividend
20-05-2019 23-07-2019 24-07-2019 10.00
14-05-2018 17-07-2018 19-07-2018 10.00

15-05-2017 18-07-2017 19-07-2017 8.00

30-05-2016 26-07-2016 28-07-2016 4.00
25-05-2015 20-07-2015 22-07-2015 4.00

2019 2018 2017 2016 2015

34.12 41.41 25.42 8.27 20.54
EPS
Dividend Per Share 10 10 8 4 4
Dividend Pay-out Ratio 0.215235 0.163629 0.132698 0.275458 0.133699
Dividend Yield 0.028671 0.035408 0.032701 0.017625 0.017298
Shareholding patterns
50,000,000
45,000,000
40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2019 2018 2017 2016 2015

Promoter holding Institutional holding Public holding

Promoter Holding Institutional Public Holding

holding
2019 44866579 26852061 5549611
2018 44866571 18911473 6149206
2017 44866571 19526638 5534041
2016 46866571 17557121 5503510
2015 46866571 17557121 5503510
 Working Capital

2019 2018 2017 2016 2015

2063.17 1684.45 1479.26 1327.06 1478.33
CA
1603.65 1309.62 1280.76 1284 1275.68
CL
Working
Capital 459.52 374.83 198.5 43.06 202.65
 Working Capital Analysis

2019 2018 2017 2016 2015

DSI 73.31741 76.01867 87.50688 80.6155 96.67655
DSO 15.06734 14.94357 14.39672 16.98635 15.19475
DPO 89.73168 91.95569 66.36587 47.70736 43.47685
CC -1.34693 -0.99346 35.53773 49.89449 68.39445
Introduction

• ACC Ltd is India’s foremost manufacturer of cement and concrete.

• The company`s research and development facility has a unique track record of innovative
research, product development and specialized consultancy services.
• ACCs brand name is synonymous with cement and enjoys a high level of equity in the
Indian market.
• The company has also extended its services overseas to the Middle East, Africa, and South
America, where it has provided technical and managerial consultancy to a variety of
consumers, and also helps in the operation and maintenance of cement plants abroad.
• They are among the first companies in India to include commitment to environmental
protection as one of its corporate objectives, long before pollution control laws came into
existence.
• The company also in the business activities of Cement, Ready Mixed Concrete.
Capital Structure
14,000.00

12,000.00

10,000.00

8,000.00

6,000.00

4,000.00

2,000.00

0.00
2019 2018 2017 2016 2015

Total Shareholders Fund Long Term Borrowing Short Term Borrowing Other Current Liabilities

  2019 2018 2017 2016 2015

Total Shareholders Fund 11,543.77 10,531.90 9,355.85 8,641.52 8,421.14
Long Term Borrowing 0 0 0 0 0
Short Term Borrowing 0 0 0 0 0
Other Current Liabilities 4698.23 4706.16 4792.66 4051.18 3785.89
Dividend
Ex-Dividend Date Effective Date Dividend
27-03-20 29-03-20 ₹ 14
05-03-19 07-03-19 ₹ 14
17-05-18 19-05-18 ₹ 26
25-07-17 27-07-17 ₹ 17
16-03-17 18-03-17 ₹ 17
  2019 2018 2017 2016 2015
EPS 73 81 49 32 31
Dividend Per Share 14 14 26 17 17
Dividend Pay-out Ratio 0.1937 0.1747 0.39 0.5306 0.5402
Shareholding Pattern
120000000

100000000

80000000

60000000

40000000

20000000

0
2019 2018 2017 2016 2015

Promoter Holding Institutional Holding Public Holding

  2019 2018 2017 2016 2015

Promoter Holding 102395210 102395120 102395120 102395120 94429120
Institutional Holding 56231401 57837660 58856276 58520774 62966696
Public Holding 29160652 27554483 26535867 26871369 30349540
 Working Capital

2019 2018 2017 2016 2015

8,280.31 6,581.97 5,617.81 4,032.50 3,370.65
CA
4,684.48 4,694.78 4,840.00 4,086.21 3,808.76
CL
Working
Capital 3,595.83 1,887.19 777.81 -53.71 -438.11
 Working Capital Analysis

2019 2018 2017 2016 2015

DSI 61.98047 76.65617 71.39956 73.50031 65.48316
DSO 14.65045 21.41122 18.35908 15.2999 14.98604
DPO 79.90833 87.80688 92.07463 75.49315 48.15706
CC -3.27741 10.26051 -2.316 13.30705 32.31213
Introduction

• Star Cement Limited is the largest cement manufacturer in north east

India. Plant is spread across 200 hectares of land in the idyllic town of
Lumshnong, a strategic location at Meghalaya.
• Star Cement was recognized by the Meghalaya state government for
its pioneering cement plant in the backward area of Lumshnong in
2005
• The company is an ISO 9001:2008, ISO 14001 & OHSAS 18001
certified Company.
 Chart Title
Capital 9000.00

Structure 8000.00

7000.00

6000.00

5000.00

4000.00

3000.00

2000.00

1000.00

0.00
2019 2018 2017 2016 2015

Total Shareholders Fund Long Term Debt

2019 2018 2017 2016 2015

Total Shareholders Fund 7620.62 4867.25 5879.48 4881.75 7021.83

1.76 198.8 371.53 384.33 502.47
Long Term Debt

D/E 0.000231 0.04084443 0.06319101 0.07872798 0.07155824

Dividend

Announcement Date Ex-Dividend Date Effective Date Dividend

17-05-2018 21-07-2018 23-07-2018 ₹ 01.00

2019 2018 2017 2016 2015

7.13 7.89 4.64 3.2 2.83
EPS
Dividend Per Share 0 1 0 0 0

Dividend Pay-out Ratio 0 0.19888 0 0 0

Dividend Yield 0 0.028393 0 0 0
 Shareholding Pattern
Chart Title
350,000,000

300,000,000

250,000,000

200,000,000

150,000,000

100,000,000

50,000,000

0
2019 2018 2017 2016 2015

Promoter Holding Institutional Holding Public Holding

2019 2018 2017 2016 2015

Promoter Holding 276,774,428 288,710,365 307,067,820 0 0

Institutional Holding 38,108,853 41,704,890 19,432,192 0 0

Public Holding 97,545,716 88,813,742 92,728,985 0 0

 Working Capital

2019 2018 2017 2016 2015

1148.45 1396.25 1325.31 1051.11 722.03
CA
388.05 658.29 735.8 865.63 623.68
CL
Working
Capital 760.4 737.96 589.51 185.48 98.35
 Working Capital Analysis

2019 2018 2017 2016 2015

DSI 32.4503 67.5576 31.363 41.39587 33.82424
DSO 27.54433 31.69208 35.0387 89.54163 74.47033
DPO 38.30797 87.53701 37.48594 71.76873 65.64971
CC 21.68665 11.71267 28.91576 59.16876 42.64486
Introduction
 The Ramco Cements Limited is the flagship company of the Ramco
Group
  It is headquartered at Chennai
 The main product of the company is Portland cement, manufactured
in eight state-of-the art production facilities
  The company is the fifth largest cement producer in the country
 Most popular cement brand in South India
 The company also produces Ready Mix Concrete and Dry Mortar
products
 Chart Title
Capital 20000.00

Structure 18000.00

16000.00

14000.00

12000.00

10000.00

8000.00

6000.00

4000.00

2000.00

0.00
2019 2018 2017 2016 2015

Total Shareholders Fund Long Term Debt

2019 2018 2017 2016 2015

Total Shareholders
Fund 18153.79 17049.87 16014.23 9519.50 7264.91
701.18 418.78 511.04 1059.46 1727.34
Long Term Debt
D/E 0.0386244 0.02456206 0.03191161 0.11129366 0.23776472
Dividend
Announcement date Ex- Dividend date Record Date Dividend
22-05-2019 31-07-2019 02-07-2019 ₹3.00
23-05-2018 26-07-2018 28-07-2018 ₹3.00
31-05-2017 27-07-2017 29-07-2017 ₹3.00
04-03-2016 18-03-2016 20-03-2016 ₹3.00
29-05-2015 29-07-2015 31-07-2015 ₹1.50

2019 2018 2017 2016 2015

EPS 21.68 23.95 27.83 22.9 10.34
Dividend per share 3 3 3 3 1.5
Dividend pay-out ratio 0.139833 0.127326 0.108965 0.192097 0.11504
Dividend yield 0.015579 0.017186 0.018819 0.022798 0.013603
 Shareholding Pattern
120,000,000

100,000,000

80,000,000

60,000,000

40,000,000

20,000,000

0
2019 2018 2017 2016 2015

Promoter Holding Institutional Holding Public Holding

2019 2018 2017 2016 2015

Promoter Holding 100,705,560 100,705,560 100,705,560 100,705,560 100,705,560
Institutional Holding 89,474,251 86,839,207 87,519,715 90,967,224 91,497,395
Public Holding 45,396,969 48,032,013 49,851,505 46,403,996 45,873,825
 Working Capital

2019 2018 2017 2016 2015

1380.51 1298.59 1421.78 1334.18 1118.46
CA
2067.55 1824.03 2025.48 2033.25 1428.66
CL
Working
Capital -687.04 -525.44 -603.7 -699.07 -310.2
 Working Capital Analysis

2019 2018 2017 2016 2015

DSI 78.42126 96.96736 118.7426 122.8798 99.3941
DSO 34.7512 36.63867 51.28154 47.55481 38.07531
DPO 36.0404 46.26185 52.78344 46.80004 41.95677
CC 77.13206 87.34417 117.2407 123.6345 95.51264
Unlevered and Re-levered Beta
 
Company levered beta (1 yr) Net Sales (Cr) D/E Ratio u beta RL Beta

Ultratech 1.35 10,353.80 0.146663 1.202732 1.232179

Shree 1.16 12936.35 0.028952 1.131443 1.13742

1.156487
Ramco 1.02 5530.44 0.016329 0.991545
1.21
ACC 15,656.65 0 1.21 1.21

JK cements 1.3 5604.34 0.226852 1.050186 1.385405

1.123942
Star cement 0.739 1794.19 0.000485 0.738771

1.943372
India cement 1.96 5720.28 1.004617 1.122289
 Cost of Equity, Debt and WACC

Risk
No. of Premium
outstanding Avg. Market Market Beta ( NYU Stern- WACC (with
Company shares Price Cap Debt D/E Kd Rf (TSR) Beta (RL) Country) Ke (with RL) RL)

Ultratech 274.61 4320.22 118637.56 19551.16 0.164797 0.058334 0.0655 1.35 1.232179 0.071 0.15298467 0.139593347

Shree 34.84 20597.86 71762.94 2437.78 0.03397 0.07466 0.0655 1.16 1.13742 0.071 0.1462568 0.143904574

Ramco 235.58 770.6 18153.79 701.18 0.038624 0.051785 0.0655 1.02 1.156487 0.071 0.14761057 0.144046992

ACC 187.79 1429.56 26845.71 0 0 0 0.0655 1.21 1.21 0.071 0.15191 0.15191

JK cements 69.93 1089.75 7620.62 2439.79 0.320156 0.077425 0.0655 1.3 1.385405 0.071 0.16386376 0.142901111

Star cement 421.42 100.18 4221.79 1.76 0.000417 0.065458 0.0655 0.739 1.123942 0.071 0.1452999 0.145266629

India cement 21.71 86.22 2679.06 2691.43 1.004617 0.097853 0.0655 1.96 1.943372 0.071 0.20347939 0.150544322