Apr 15 2016 | Q&A

Krishna Srivastava, Whole Time Director, Zuari Cement


“The Cement Industry in the last 3 years have been passing through the worst demand scenario in the recent few decades, with a colossal demand-supply mismatch especially in South India. We have seen 3 continuous years of dropping demand in South India which has a CAGR of around 14%. This, along with a supply scale up of 12% for the same period have made situation even worse. The way India seems to be projected for growth of over 7% GDP in the current year & another couple of years to come, Cement sector, being part of the core sector, has a gleam of hope. However, the investment that the Government both in Centre & the States make in Infrastructure development will have the key say.

Krishna Srivastava, Whole Time Director, Zuari Cement Ltd shares views about his company, core competencies, products offered, manufacturing base, operational efficiency and demand scenario shaping for cement in India. Edited Excerpts...

Could you tell us in brief about your company, brand and core competencies?
Zuari Cement is part of the worldwide Italcementi Group, the fifth largest cement producer in the world. Zuari Cement has a total cement manufacturing capacity of 6 million tons in India, which includes two manufacturing units at Sitapuram and Yerraguntla, along with a grinding centre at Chennai and at Solapur in Maharashtra. Zuari cement is developing a project of 3 million ton per year cement plant in North Karnataka. A cement terminal is also being developed at Kochi, Kerala. In line with Groups' global focus on quality and environment, Zuari Cement's manufacturing units are ISO 50001: 2011, ISO: 9001 and ISO: 14001 Certified. In the year 2015, among the accolades Zuari Cement have won, are “World’s Greatest Brands – Asia & GCC 2015” by PricewaterhouseCoopers, “Global Marketing Excellence Award (Cement Sector)” by CMO Asia, “Asia Manufacturing Excellence Award for Safety 2015”, and CII “National Award for Excellence in Energy Management” and “Excellence Award” by IES. Our Whole Time Director won the “Udyog Ratan” Award by IES for 2015. We have earlier been adjudged as ‘Outstanding Company’ in Cement sector, at the 4th EPC World Awards 2013. Zuari Cement has been recognized as a “Power Brand” for the second consecutive year in 2013. Earlier in 2011 awarded “Master Brand” by the CMO council Asia.

Could you provide us insight about your products/solutions offered?
Our product portfolio includes Ordinary Portland cement, Portland slag cement, Portland Pozzolana cement, Masonry Cement, Anti polluting and self-cleaning “Tx Active Cement”, transparent cement named “i.light”. Zuari Cement's latest launch is i.pro Brixment-Masonry Cement. The mortar of i.pro Brixment spreads easily and has a superior adhesive and cohesive quality which extrudes readily from the joints as units are placed and does not smear nor drops. The superior plasticity prevents rapid loss of mixing water enabling the masonry units to be carefully aligned, leveled, plumbed and adjusted to proper grade without the intimate contact and bond. i.pro Brixment has greater resistance to chemical attack, staining and freeze-thaw deterioration due to the controlled air content of masonry cement mortars. It has a consistent rate of hardening enabling the mason to lay the masonry units and tool the joints at the same degree of hardness, thereby obtaining uniform joint color. This cement is specifically designed to cater the masonry needs of construction and are made available in 25 Kg Paper bags as against the conventional 50 Kg Cement bag.

As a group, Zuari belongs to the Italcementi group that is world renowned for Innovative products and have all types & varieties of Cement that cater to all construction needs.

What's your market share vis-a-vis the cement industry in India?
We are predominantly a South India based player and to talk about market share on All India basis would be wrong, as we operate in only States of South India and Southern Maharashtra & Orissa. In the markets that we operate, we have a commendable market share and also a very well established Brand equity that translates into better margins for the Company & its Channel partners.

Could you share with us details about your manufacturing base, capacity and production process?
As explained earlier, we have 2 integrated plants in Yerraguntla (AP) & Sitapuram (Telegana). We also have 2 grinding facilities at Chennai (Tamil Nadu) and Solapur (Maharashtra). Our new packing unit is just about to be commissioned in Cochin (Kerala). Zuari holds a clinker production capacity of 5.0 MT & Cement production capacity is 7.4 MT.

Do you have any plans in place to cut costs and increase operational efficiency?
We have devised internal strategies on optimum resource utilization & increased operational efficiency. Our efforts have really borne fruits and it has been well appreciated by CII, while awarding us the prestigious National Award for Excellence in Energy Management in 2015. We are also the Co-chair for CSI India and have consistently displayed our conscious efforts to have a sustainable operation in the manufacturing of Cement.

How is the current demand scenario shaping up for cement producers in India? What's your expectation from the next financial year?
The Cement Industry in the last 3 years have been passing through the worst demand scenario in the recent few decades, with a colossal demand-supply mismatch especially in South India. We have seen 3 continuous years of dropping demand in South India which has a CAGR of around 14%. This, along with a supply scale up of 12% for the same period have made situation even worse.

The way India seems to be projected for growth of over 7% GDP in the current year & another couple of years to come, Cement sector, being part of the core sector, has a“ gleam of hope. However, the investment that the Government both in Centre & the States make in Infrastructure development will have the key say. As part of a multi-billion cement industry we sincerely believe that the bad times are all behind us.

How do you plan to tackle the competition in the cement sector?
We have always been able to create a niche market of quality conscious customers for ourselves. Despite the fact that we are not a pan India player, with huge capacities in India, we have been able to astutely use our status as part of the 5th largest Cement manufacturer in the world, having operations in over 22 countries.

Our brand building exercises have also complimented our efforts. The same has well been acknowledged by accolades we have received in the recent past as also the recognition the Channel & end-user communities have bestowed on us.


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