The Rs 5,677-crore Larsen & Toubro (L&T) plans to be a dominant player in the cement industry, says S S Marathe who chaired the 53rd annual general meeting of the company here yesterday.
Although there is a temporary mismatch with the market aflush with this commodity, Marathe maintains that in the near future there will be a shortage of cement to the extent of almost 1 million tonne in the southern and western states of India. Marathe pointed out that there were several infrastructure projects on cards in these states. He pointed out that L&T was in better position as it has cement manufacturing units in these states.
"With in house supply of cement machinery and services it is a natural synergy for L&T to be in the cement sector," he pointed out. L&T's cement plants are not only equipped with modern technology but are also cheapest at given time, he claimed.
In India, the per capita consumption of cement is lowest at 80kg against China where the consumption level is close to 500kg per person and in Sri Lanka where the per capita consumption of this commodity is 240 kg.
L&T is consolidating its position in its core areas, engineering, construction and cement sector, which together is responsible for 90 per cent of the company's turnover.
Marathe told shareholders that "L&T plans to reach world standards and global size in the existing areas of activities."
Replying to a shareholder's query, Marathe said that the company was hiving off certain business which did not fit into its core competence.
This is being done as a part of focus attempt at growth and to establish presence in areas where L&T is competitive. Moreover, also to maintain a dominant position, he added.
The AGM was also attended by H Holck- Larsen, co-promoter of L&T and chairman emeritus, as well as Ole K Toubro, son of co-founder K Toubro.
Meanwhile, during the first quarter, the company's profit stood at Rs 72 crore and sales and service revenues for the quarter stood at Rs 1,470 crore.
On the company's performance for 1997-98, Marathe said the company was hit by the negative growth of 4 per cent in the capital goods industry. L&T manufactures sophisticated capital goods for a number of vital industries.
