Financial Performance
Q4FY2010
During the Quarter, Company has posted Net Sales of Rs. 944 crore, up 17% from Rs. 805 crore in corresponding previous quarter of last year. Cement and Clinker Sales Volume of the Company grew 12% against North Indian Demand Growth of 8%. Contribution of Power Business in Net Turnover was Rs. 54.06 crores, up 22% from corresponding previous quarter.
EBITDA for the quarter was Rs. 330.96 crore against Rs. 337.25 crore in corresponding quarter of previous year.
FY2010
Fiscal 2009-10 was a good year for the Company. During the year, Company posted net sales of Rs. 3632 crore, up 34% from Rs.2711 crore in 2008-09. Increase in turnover is both on account of better cement realizations and increased volumes as a result of capacity expansion undertaken by the company. Cement and Clinker sales volume grew at 22% against 11% demand growth recorded in North India. Contribution from power business in net turnover more than doubled from Rs. 80.63 crores to Rs. 176.95 crores.
Led by Increased operational efficiency, better capacity utilization and higher price realization, operating Profit for the year increased by 59% at Rs. 1578 crore. Net profit increased 17% to Rs. 676 crore.
Dividend
Company’s Board has declared a Final Dividend of Rs 8/share to its members. The company had also paid an Interim Dividend of Rs. 5/ share during the year which takes total Dividend payment for the year to Rs.13/ share against Rs. 10/share paid last year.
Capacity Expansion
During the year the company expanded both its cement and power generation capacity. Company commissioned two grinding units of 1.2 million ton at Suratgarh in Rajasthan and 1.8 million ton at Laksar in Uttarakhand. On the Power business side, company commissioned 46 MW Green power plants and also implemented first unit of 50 MW of its proposed 100 MW (2 x 50MW) thermal power plants. This has taken the total power generation capacity to 210 MW. All the above capacity expansions were implemented within time and cost estimates.
Company is further expanding its cement capacity by setting up a 1 mtpa clinkerisation unit (U- VIII) at Ras and 1 mtpa cement grinding unit in Jaipur. Company’s 300 MW (2 x 150 MW) thermal power plants to be set up at Beawar is progressing as per schedule and is expected to come up by Dec-11.
Power Trading
To further expand its footprint in the evolving power sector, company ventured into trading of power during the year. In this regard, company received Category 1 interstate power trading license in March 2010 from the Central Electricity Regulatory Commission (CERC). Company has constituted a separate division called Shree Power Trading to undertake purchase / sale of electricity. This division based out of New Delhi has already commenced operations and is actively undertaking trading of electricity.
Sustainability
During the year the company successfully commissioned Green Power Plants of 46 MW at Beawar and Ras. This is the largest GPP capacity in the world cement industry excluding China. The project serves the dual purpose of eliminating the emission of waste gases into the atmosphere as well as conserves the natural resources for utilization in power generation. As a measure to conserve water, company installed air cooled condensers at its Beawar Power plants to reduce water consumption by as much as 70%.
During the year, company accomplished a unique initiative of making and utilizing synthetic gypsum instead of natural gypsum. Company is the first in India to accomplish such project. A patent has been applied for this unique achievement. The project will help reduce usage of natural gypsum which is a limited natural resource.
Awards
Company received the certificate from “Limca Book of Records” for setting up 1 mtpa clinker plant (Unit VII) at Ras in record time of 367 days. The certificate bears testimony to the excellent project execution capabilities of the company.
Outlook
Cement consumption revived during the year 2009-10 on account of better demand from infrastructure and housing especially rural housing. Cement consumption grew by 11% during 2009-10 and 10% in Q4 09-10.
Going forward we believe that government initiatives to boost infrastructure and strong demand from rural and mass/ affordable housing segment will continue to drive cement demand growth at a healthy pace. However new capacity added over last year and expected addition in 2010-11 is likely to exert supply side pressure and may impact margins of cement companies.
About Shree Cement Limited
Shree Cement Limited, the largest cement manufacturer of North India and among top five cement manufacturers in the country, is an energy conscious and environment friendly organization and is a part of many international forums propagating green initiatives. Its “Optimal Utilization of Clinker” project has already saved large amount of carbon emission and earned carbon credits for the same. Its latest initiative is setting up of 40 MW Green Power projects which will be largest capacity of in the entire world cement industry. The Green Power Plants would utilize waste heat generated from Company’s cement plants which is presently emitted into atmosphere and thus would conserve precious fossil fuel sources.
Shree Cement has been rated one among the top 20 Best Employers in India as per a survey carried out by Business Today Magazine along with Mercer-TNS. Shree Cement is the only Cement Company and only Company of Rajasthan, which finds place in the said list. The high ranking of the Company in the survey, is a recognition to Company’s first-rate HR practices and “happy family” culture fostered in the organization.
