Ambuja Cement’s strategic plan on track to increase capacity to reach 50 MTPA
Business Wire India
The 38e Annual General Meeting of Ambuja Cements Ltd. has been carried out practically today. Mr. Martin Kriegner, non-executive director of the company, chaired the meeting. The President mentioned that Ambuja Cement is progressing strongly to become the ‘Most Innovative, Sustainable and Competitive Construction Solutions Company in India“. Ambuja Cement has a solid roadmap to become the best in the industry with strategic priorities structured under the main levers of growth, competitiveness, innovation and Digitization, and sustainability.
Growe: Ambuja Cement has ambitious growth plans to increase capacity and capture market growth in India. Its upcoming facility in Marwar Mundwa, Rajasthan, will increase clinker capacity by 3 MTPA and help improve cement sales by 5 MTPA, thus contributing to the long-term capacity expansion strategy. This integrated plant in Greenfield, at a total investment of Rs. 2,350 crore, will begin operations by Q3 2021. Ambuja is evaluating brownfield expansions at the Bhatapara and Maratha factories. It is also studying important opportunities for de-congestion in all factories. Growth plans will be executed in the medium term for Ambuja to reach a cement capacity of 50 MTPA.
Competitiveness: Ambuja operating EBITDA increased 23% to Rs. 2,647 crore and net profit increased 17% to Rs. 1,790 crore in 2020. Operating EBITDA and net profit margin for the year stood were 23.7% and 16% respectively, representing growth of 480 basis points and 260 basis points compared to 2019. This strong performance was achieved thanks to several cost management and efficiency initiatives. During the year, Ambuja leveraged synergies with ACC to drive scale and performance. This synergy within the framework of the Master Supply Agreement with ACC led to more than 5% contribution to Pre-Tax Profit in 2020. Ambuja Cement has a solid balance sheet with zero debt and a AAA rating from Crisil.
Iinnovation and digitization: During the year, Ambuja launched its special product, “Ambuja Kawach”, which is a durable water repellent cement and reduces the carbon footprint by 33% compared to other products. Its specialty products volume saw strong double-digit growth of 16% in 2020 and now represents 11% of its total volumes.
Ambuja is strongly committed to improving business efficiency by leveraging digitization. The main focus of the year has been to implement digital tools in various parts of operations to improve performance. The main initiative was the “Plants of Tomorrow” program. which records and reports data from all assets in real time, helping to improve operational efficiency. On the logistics front, the artificial intelligence-based supply chain management platform ‘Blue Yonder’ has been launched, and ‘Transport Analytics Center ”adopted from parent company LafargeHolcim. Ambuja also has increased its digital engagement with customers and channel partners.
Durability: Ambuja cement Global parent company LafargeHolcim is committed to becoming a “Net Zero” company and has set itself the most ambitious climate goals in the cement industry. Ambuja aligned with the “Net Zero” plan and the sustainable development strategy of its parent company. Ambuja’s 2030 sustainable development plan has a strong focus on climate and energy, building a circular economy, conserving resources and nature, and driving meaningful changes in the lives of communities. It aims to reduce CO2 to 463 kg CO2 / t cem. Ambuja aims to reuse 13.5 million tonnes of waste and be 13 times more watery. It aims to save 77 liters / ton of water cement and have a positive impact on the lives of 80 lakhs beneficiaries through its various CSR programs.
In 2020, Ambuja reduced its specific net CO2 per tonne of cement product to 531 kg. A unique initiative underway is the construction of WHRS at three locations by 2022 that would produce 54 MW to meet the power needs of its plants. As part of the circular economy, Ambuja has co-processed around 4.5 lakhs of tonnes of waste in its ovens, including 83,000 tonnes of plastic waste. In addition, it consumed around 8 million tons of alternative raw materials derived from waste such as fly ash, slag and synthetic gypsum in the manufacturing process. Ambuja is at the forefront in India in providing long-term and sustainable waste management solutions through “Geocycle”, its waste management arm. In 2020, Ambuja was 8 times positive for water and reached 15.6 lakhs beneficiaries, through its CSR programs. Acrossing all of its 20 locations, Ambuja reported zero fatalities. He ranked 5e in the Global Dow Jones Sustainability Index, a very significant worldwide recognition.
Comments from Mr. Martin Kriegner, President of the 38th AGM:
“I want to congratulate all Ambuja employees for their resilience and their commitment to deliver a remarkable performance in 2020. On behalf of the Board of Directors, I express my sincere appreciation for the efforts and hard work of employees at all levels and wish them the best for the year 2021. I take this opportunity to thank all of our shareholders for their trust .
Proceedings of the AGM:
Mr. Martin Kriegner and other members of the board of directors, and shareholders joined the meeting by video conference.
The Board declared an interim dividend of Rs. 17 per share and recommended a final dividend of Rs. 1 per share, which was approved by shareholders at today’s AGM. So the overall dividend for the year is Rs 18 per share and the total payout will be Rs. 3,574.16 crore.
The full results of the AGM, with the president‘s speech, must be uploaded to the company‘s website www.ambujacement.com