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Displaying items by tag: India
Cement industry safety in India
06 February 2013A stark reminder came this week of the thankfully rare but potential risks of working in the cement industry. Five deaths were reported at Ambuja Cement's Bhatapara cement plant in India on 31 January 2013.
According to a press release Ambuja issued, the steel construction supporting a fly ash hopper located on top of a building, and connected to the cement mill, collapsed at the Bhatapara plant. Further details in local press reports added that about 200t of fly ash fell from a height of 15m. Five labourers and plant employees working at the site were buried under the debris and subsequently died. Four officials from the company have since been arrested and the plant closed while investigations are conducted.
Previously in January 2013 burn injuries were reported as another Ambuja cement plant, this time at Darlaghat. Eight workers received burns after a blast from a boiler unit.
However, despite these incidents the safety figures for Ambuja Cement and the other major Indian producers are high. In Ambuja Cement's 2011 sustainability report it recorded that its lost time injury frequency rate (LTIFR) was 1.04 for total employees and supervised workers. Its LTIFR has been dropping steadily since 2008, when it was 3.18.
This compares to other major Indian cement producers as follows. UltraTech Cement reported that its LTIFR for permanent employees was 0.82 in 2011-2012, a consistent drop year by year since 2008-2009. ACC reported that its LTIFR for its own and subcontracted employees was 0.31 in 2011. Shree Cement reported a LTIFR of 0.91 in 2010-2011 for employees and contractors. For international comparison the Mineral Products Association set a LTIFR target of 1.79 or lower for 2014 in the UK. Lafarge's global LTIFR in 2011 was 0.63 and Holcim's was 1.6.
An Ambuja's plant in Rajasthan picked up two national awards from the Government of India for Safety Performance in mid 2012. One was for first place for outstanding performance in Industrial Safety based on 'Lowest Average Frequent Rate'. The second was a runners-up prize for the category 'Accident Free Year'. Lafarge India, UltraTech, ACC and the other major producers all hold similar accolades. Sadly, any safety record is only as good as the shift that has just finished.
Four officials arrested at Ambuja Cement following deadly accident
06 February 2013India: Four officials at Ambuja Cement have been arrested following an accident with five fatalities at the company's cement plant at Rawan in Chhattisgarh.
"Vice President of Ambuja Cement Sanjay Kumar Badopadhyay, DGM Production K Venkat Stayanarayan Murty, DGM Mechanical Rajendra Singh Kurmi and GM electrical Sanjay Kumar Mishra have been arrested in connection to the Ambuja cement factory (incident)," said a police officer to the Press Trust of India. They were booked under IPC sections 287 (negligence with machinery), 337 (endangering life or personal safety) and 304A (causing death by negligence).
Five workers were killed on 31 January 2013 when a fly ash container crashed into the mixing unit of the plant at Rawan village. A case has been registered against Ambuja Cement management and the labour department has ordered a halt to factory operations until an investigation into the incident has been completed.
Chief Minister Raman Singh has directed the factory management to provide compensation of US$18,800 to the kin of each victim and a job to one member of their families. A six-member panel headed by additional collector of Balodabazar district has also been formed to conduct magisterial probe into the incident, which has been asked to submit its report in one week.
Jaiprakash Associates ‘unable’ to pay US$18.8m power plant fine
06 February 2013India: Major Indian cement producer Jaiprakash Associates has informed the Supreme Court of India that it is unable to pay a US$18.8m fine imposed by the Himachal Pradesh High Court for setting up a captive thermal power plant without gaining the required environmental clearance.
The Jaypee group firm said that it is in 'great difficulty' and can't arrange funds to pay its second instalment of US$4.7m that is due on 31 March 2013. However, it said it had paid the first instalment of the same amount. A bench headed by chief justice Altamas Kabir agreed for an early hearing on 12 March 2013 even though the environment ministry and the state government opposed the plea, saying that there is no way for Jaiprakash Associates to avoid the US$18.8m fine.
On 4 May 2012 the High Court ordered the Jaiprakash Associates to dismantle its 60MW captive power plant within three months. It allowed the 1.75Mt/yr cement plant in Solan to stay. In November 2012 Jaiprakash Associates reported that its net profit for the six months to 30 September 2012 had dropped by nearly 40% to US$50.1m from US$81.3 in the same period in 2011.
Indian producer records loss in three months to December 2012
25 January 2013India: Prism Cement has reported a loss of US$10.1m for the quarter ending 31 December 2012, due to poor demand for the building material, high power and raw material costs. The firm, which has also has interests ready- mix-concrete and tiles as well as cement, had made a US$4.3m net profit in the October-December quarter of 2011. Prism's net sales fell as expenses rose.
"Poor demand, weak government spending on infrastructure kept prices of cement under pressure in the quarter," said Prism in a presentation to investors. "Coupled with higher power,freight and raw material costs, realisations have been adversely impacted. The markets are expected to improve and stabilise during the last quarter of the financial year."
Vicat starts dispatching cement from Gulbarga plant
23 January 2013India: Vicat Group, the French multinational cement producer, has announced the first line of commercial dispatch from its 2.75Mt/yr greenfield cement plant in Chatrasala village, Gulbarga district, Karnataka. Cement from the plant will be marketed under the brand name of Bharathi Cement and targeted for domestic consumption in north Andhra Pradesh, north Karnataka and Maharashtra.
The Gulbarga plant is a joint-venture between Vicat and Sagar Cements. Vicat already has a joint venture, Bharathi Cement, in Kadapa, Andhra Pradesh, with a 5Mt/yr capacity which has been in operation since 2009. With the start of production at Gulbarga, Vicat's cement capacity in India has risen to 7.75Mt/yr, making it amongst the top cement producers in the south of India.
Vicat Group has close to 7400 employees working in three core divisions, cement, concrete and aggregates and other products and services, which generated consolidated sales of Euro2.27bn in 2011. The group operates in 11 countries: France, Switzerland, Italy, USA, Turkey, Egypt, Senegal, Mali, Mauritania, Kazakhstan and India.
UltraTech profit down by 3%
23 January 2013India: UltraTech Cement, an Aditya Birla Group company, has reported a net profit of US$112m for the last three months of 2012, a drop of 3% compared to US$115m in the same period in 2011. The company blamed subdued demand and higher costs caused by increases in railway freight and diesel prices. Net sales for the quarter rose by 6% to US$904m from US$850m.
During the quarter, UltraTech reported that imported coal cost around US$100/t but that the benefit of this low price was partly offset by the depreciation in the Indian Rupee. New clinker plants at Chhattisgarh and Karnataka are expected to be operational by early 2013-2014 and will add 9.2Mt/yr to UltraTech's capacity. Once completed UltraTech's total capacity will reach 62Mt/yr.
In its outlook, the company said that the surplus scenario in the industry is likely to continue over the next three years. "Input costs are likely to increase in line with general inflation with margins remaining range bound,'' the company said.
Dalmia Cement to invest US$335m by 2014
23 January 2013India: Dalmia Cement has prepared a US$335m investment plan to ramp up the company's cement manufacturing capacities by the end of 2014. With this expansion the company's total capacity will grow from 17Mt/yr to 21Mt/yr. The move will also help strengthen the company's presence both nationally and in the north east of India.
The company intends to set up a 2.5Mt/yr greenfield unit at Belgaum, Karnataka, for a cost of US$242m and expand its two plants in north-east for US$93m, according to Puneet Dalmia, CEO & managing director of Dalmia Cement. Completion of the proposed expansions is expected to boost the company's bottom line by 10%. The firm, which also owns 45.4% stake in OCL India, will commission its new unit under OCL India by December 2013.
India Ratings upgrades 2013 outlook for cement sector
16 January 2013India: India Ratings has revised its outlook for Indian cement manufacturers to 'stable to negative' for 2013 from 'negative' in 2012, driven by limited downside risk for demand. The ratings agency also expects consolidation in the medium-to-long-term with large-scale merger and acquisition activities, according to a report. "We expect consolidation in cement industry in the medium-to-long-term with large merger and acquisition activities in the sector," the rating agency said.
The agency expects credit profiles of large cement firms with superior cost positions and a presence across India to remain stable in 2013. However, smaller companies, with unfavourable cost structures and regional concentrations, are likely to be under pressure.
With growth of the housing sector at 13% and that of the commercial real estate sector (CRE) at 4% until November 2012, India Ratings expects cement demand to grow by 5-8% year-on-year in 2013. Cement production volume in 2012 was mainly driven by a relatively robust activity in housing and commercial real estate. From September 2010 to March 2012, the average growth in credit to the housing sector was around 15-16% in commercial real estate.
Large integrated players, those that are among the top five in the country in terms of production capacity, are likely to have median earnings before interest, taxes, depreciation and amortization (EBITDA) margins in the range of 23-24% in 2013, comparable to the levels seen in the 2012 financial year. However, smaller or partially-integrated players are likely to exhibit margins ranging from 17-19%, lower than the median margins observed for such companies in 2012 financial year, the report said.
With regards to consolidation the report says that the top five companies, constituting around 50% of the industry capacity, enjoy a better cost-structure driven by significant vertical integration and locational advantage with respect to sourcing of raw materials and market access.
"Most other companies, because of lack of one or more of these factors, have a weaker competitive position. The industry economics and the regulatory actions exhibited by the Competition Commission of India (CCI) may push marginal players to consolidate", the ratings agency said.
ABG to sell stake in cement business
09 January 2013India: Private sector ship builder ABG Group is in talks with private equity and financial firms to sell a minority stake in its cement business for about US$150m. According to Dhananjay L Datar, director of ABG Group, a potential deal is at a preliminary stage with several parties showing interest in the cement unit.
The group's cement business, ABG Cement, has a 6.5Mt/yr plant in Kutch, Gujarat, which is expected to be commissioned by the end of January 2013. India media has linked equity firms Blackstone and KKR to the deal. ABG Group originally announced its plans to enter the cement sector in 2008 with an initial investment of US$328m.
CRH confirms continued interest in India
04 January 2013Ireland: CRH chief executive Myles Lee has confirmed that the building materials group is interested in expanding its presence in India. The comment follows rumours from the Indian media that CRH and Holcim are both in separate talks with the Shriram Group to buy a stake in Sree Jayajothi Cements (SJJCL).
Lee said that CRH remained interested in expanding its presence in India, but declined to comment on Sree Jayajothi. CRH 'terminated' negotiations with Jaypee Cement Corporation in October 2012 because the parties were unable to agree terms.
"We have been on the lookout for a partner for quite some time and we keep having several discussions with different players both strategic and financial," said T Shivaraman, managing director and chief executive of Shriram Engineering and Procurement Company, which owns SJJCL. He refused to comment on the involvement of either CRH or Holcim. It has been reported that private equity giants Blackstone and KKR are also in separate preliminary talks with Shriram about its stake in the cement manufacturer. SJJCL owns a cement plant with a production capacity of 3.2Mt/yr based in Andhra Pradesh.
The rumours arrived at the same time that CRH announced it had made acquisitions and investments valued at Euro630m in 2012. The bulk of the money was spent in the US, where Euro256m was spent in the second half of the year. In Europe CRH spent Euro119m in the second half of 2012 in acquisitions in Finland and the UK. Lee confirmed that CRH holds between Euro1bn and Euro1.5bn to spend on deals.
Both CRH and Holcim have a combined capacity of around 61Mt/yr in India. Holcim controls ACC and Ambuja Cements while CRH has a venture with Hyderabad-based My Home Industries, which owns a 4.2Mt/yr plant.