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A Project Study Report

On:

Traning undertaken at

SHREE CEMENT LTD.

!AN"#R NA"AR$ !EA%AR$ D&STT. A'MER(

Capita) Structure * Co+t O, Capita)Submitted in partial fulfillment for the

Award of degree of

Master of Business Administration

Su-itted to

Su-itted !y:

Mr. Rajat Lokendra saini (faculty) M!A /ed See+ter(

Apex Institute of Management & Science, Jaipur

(Approved b AI!"#, $ew %elhi & Affiliated to niversit of 'aasthan, Jaipur)

012230120(

1

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PRE4ACE

IT IS GOOD TO HAVE GOOD KNOWLEDGE. IT IS GOOD TO HAVE GOODWILL BUT IT IS ESSENTISL TO HAVE A GOOD TRAINING

PAND&T 'A%HARLAL NEHR#(

About three decde !o" the #co$e o% &''c() *'!e*e't +# co'&'ed to the

r(#('! o% %u'd#" +he'e,er 'eeded 'd )(tt)e #(!'(&c'ce u#ed to be ttched to&''c() dec(#(o'-*('! 'd $rob)e* #o),('!. A# co'#e/ue'ce" the trd(t(o')

&''ce te0t# +ere #tructured rou'd th(# the*e 'd co't('ed de#cr($t(o' o% the

('#tru*e't# 'd ('#t(tut(o'# o% r(#('! %u'd# 'd o% the *1or e,e't#" #uch #

$ro*ot(o'" re-or!'(2t(o'" red1u#t*e't" *er!er" co'#o)(dt(o' etc. +he' %u'd#

+ere r(#ed.

I' the *(d &%t(e#" the e*$h#(# #h(%ted to the 1ud(c(ou# ut()(2t(o' o% %u'd#. The

*oder' th('('! (' &''c() *'!e*e't ccord# %r !reter (*$ort'ce to*'!e*e't dec(#(o'-*('! 'd $o)(c3.

Tod3" &''c() *'!e*e't do 'ot $er%or* the $##(,e ro)e o% #coreee$er# o%

&''c() dt 'd ('%or*t(o'" 'd rr'!('! %u'd#" +he'e,er d(rected to do #o.

Rther" the3 occu$3 the e3 $o#(t(o' (' to$ *'!e*e't re# 'd $)3

d3'*(c ro)e (' #o),('! co*$)e0 *'!e*e't $rob)e*#. The3 re 'o+

re#$o'#(b)e %or the %ortu'e o% the e'ter$r(#e# 'd re (',o),ed (' the *o#t ,(t)

*'!e*e't dec(#(o' o% ))oct(o' o% c$(t). It (# the(r dut3 to ('#ure the %u'd#

re r(#ed *o#t eco'o*(c))3 'd u#ed (' the *o#t e4c(e't 'd e5ect(,e

*''er. Becu#e o% th(# ch'!e (' e*$h#(#" the de#cr($t(,e tret*e't o% the

#ub1ect o% &''c() *'!e*e't (# be('! re$)ced b3 !ro+('! ')3t(c) co'te't

'd #ou'd theoret(c) u'der$(''('!#.

I * th'%u) to the *'!e*e't %or ##(!'('! #uch # ch))e'!('! $ro1ect to *e

to 'o+ bout the 6-Capita) Structure * Co+t o, Capita)

2

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AC5NO%LED"EMENT

A )r!e 'u*ber o% ('d(,(du) h# co'tr(buted to th(# $ro1ect. I * th'%u) to )) o%

the* %or the(r he)$ 'd e'cour!e*e't. L(e other re$ort#" th(# re$ort (# )#o

dr+' %ro* the +or o% )r!e 'u*ber o% re#ercher# 'd uthor (' the &e)d o%

&''ce.

I +ou)d )(e to e0$re## *3 !rt(tude to Mr. Rajat 7&''ce8 %or !(,('! *e the

o$$ortu'(t3 'd e'ou!h o% #u$$ort to u'der!o tr('('!" I te u$o' th(#o$$ortu'(t3 to th' the* %or e'cour!e*e't 'd !u(d'ce (' co*$)et(o' o%

$ro1ect. The(r 'o+)ed!e 'd e0$ert(#e +# o% !ret he)$ %or the $ro1ect #tud3 ('

the(r or!'(2t(o'" SHREE CEMENT LTD" BEAWER 7RA98.

I +ou)d )(e to !(,e *3 #('cere th'# to o4cer#" *'!er# 'd e*$)o3ee# o%

SHREE :E;ENT LTD" BEAWER 7RA98 %or $ro,(d('! ,)ub)e ('%or*t(o'" re$ort#

'd dt tht +ere re/u(re %or the #tud3.

The #ucce##%u) co*$)et(o' o% *3 $ro1ect h# bee' L#t but 'ot the )e#t I +ou)d)(e to th' *3 $re't# %or e'cour!('! 'd #u$$ort('! *e +ho)e herted)3

dur('! the cour#e o% th(# $ro1ect.

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TA!LE O4 CONTENT

4

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S.NO

.PART&C#LARS

2. I'troduct(o' o% ('du#tr3 =>

?. I'du#tr3 @ro&)e =

. Ob1ect(,e o% #tud3 =C

The I'd(' :e*e't I'du#tr3 O,er,(e+ =

>. Gro+thF;ret('!FDe*'dFTeo,er =

. :e*e't

. @ort)'d :e*e't

C. :e*e't I'du#tr3 Structure

;1or :e*e't @)'t#

;('( :e*e't @)'t#

. :hrcter(#t(c# o% :e*e't I'du#tr3

=

.

;1or De*'d Dr(,er# C

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;1or :e*e't @)3er#" Re!(o' +(#e

:e*e't @roduct(o'

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.

I'troduct(o' bout S:L6 Or(!(' o% the

:o*$'3

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:e*e't *'u%ctur('!

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Bu#('e## 'd ;'!er() :h))e'!e#

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R(# 'd Retur' o% :e*e't :o*$'(e#

. :o#t o% :$(t) C

.

:o#t o% Debt# >

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We(!hted ,er!e co#t o% c$(t) >

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;er(t# o% We(!hted ,er!e co#t o%

c$(t)

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:o'c)u#(o'

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B(b)(o!r$h3 ?5

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I$"'*%!"I*$ "* "+# I$%S"'- .

I' the be!(''('!" *' )(,ed (' thtched hou#e# but )ter # h(# hor(2o' o%

'o+)ed!e e0$'ded he cou)d $roduce +o'der%u) *ter() %or co'#truct(o'

'o+' # ce*e't.

I' the 3er > 9ho' S*eto'" ' E'!)(#h e'!('eer" erected edd3 #to'e

)(!hthou#e (' E'!)(#h :h''e) tht $,ed the #trt o% the ('du#tr3. Vr(ou# t3$e#

o% ce*e't" ro*' ce*e't 'd $o22o)o' ce*e't )#o c*e ('to e0(#te'ce. I'd(

too co'tr(buted to the $roduct(o'. I' C the I'd(' ce*e't ('du#tr3 hd '

o,er)) c$c(t3 o% C=== to'e# $er 3er. At the t(*e o% ('de$e'de'ce there +ere

? %ctor(e# (' )) +(th c$c(t3 o% .> *())(o' to'e# $er ''u*. The *1or co#t#

('curred co*e u'der the hed o% tr'#$ort 'd e'er!3 co'#u*$t(o' co'#(#t('! o%

$o+er 'd %ue). The co#t o% $roduct(o' $er to'e o% ce*e't u#u))3 r'!e#

bet+ee' R#.?= to . The $ro&tb()(t3 +()) de$e'd u$o' o$ert(o') 'd

)o!(#t(c) e4c(e'c3. A !ood (*!e +()) he)$ to co**'d !ood $re*(u*. Th(# (#

e,(de'ced b3 the $re*(u* br'd# )(e Shree U)tr :e*e't" U)trtech :e*e't"

A*bu1 :e*e't 'd B(r) :het S*rt :e*e't.

So*e *u)t('t(o') co*$'(e# )(e L%r!e 'd B)ue :(rc)e V(ctor h,e rece't)3

e,('ced ('tere#t (' #h(%t('! *ore o% the(r bu#('e## to+rd# A#(#" e#$ec())3 to

I'd(. I'%ct" O'e de) o% te-o,er h# )red3 *ter()(2ed (' +h(ch L%r!e too

o,er the ce*e't bu#('e## o% TIS:O 'd ('ue'c('! %ctor# *3 *e the

#(tut(o' tre'd. It #ee*# (**('e't tht *ore o% the* +ou)d te $)ce (' the

t(*e to %o))o+" #('ce c/u(#(t(o' (# )+3# *ore $re%erred route the'

e0$'#(o'F!ree' &e)d ('#t))t(o'.

Accord('! to #ur,e3 b3 I:RA to$ = co*$'(e# ccou't %or >J o% the ce*e't

$roduct(o' (' the cou'tr3. The ce*e't ('du#tr3 (# do*('ted b3 $r(,te #ector

ccord('! %or > o% the c$c(t3 'd J o% the $roduct(o'" +h()e $ub)(c #ector

ccou't# %or the re#t. Th(# h# $ut the ce*e't or!'(2t(o' (# #h*b)e# due to

$r(,t(2t(o' o% $ub)(c #ector 'd u$co*('! $roduct(o'.

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I$%S"' /'*0I1#

+IS"*' *0 !#M#$" I$%S'I#S-.

The h(#tor3 o% ce*e't (# the ,o3!e o% c(,()(2t(o' %ro* $r(*(t(,e c,e# o% $re-

h(#tor(c t(*e# to the #3#cr$er o% the *oder' !e. It (# #(d tht the u#e o%

ce*e't (# o)d # the 'o+)ed!e o% &re to *'. E!3$t('# ut()(2ed !3$#u* $)#ter

# ce*e't('! *ter() # er)3 # ===B:" bu()d('! *o'u*e't#.

Ho+e,er" (t +# (' the C?" rou!h)3 $er(od o% =-C= 3er# %ter the d(#co,er3

o% h3dru)(c $ro$ert(e# o% )(*e#to'e" 9o#e$h A#$d(' $te'ted h(# $roduct" +h(ch

+# c))ed @ort)'d :e*e't. The $)'t# *'u%ctur('! @ort)'d ce*e't out

#(de E'!)'d +ere co**(##(o'ed (' Be)!(u* 'd Ger*'3 (' C>>. The ('tere#t

tht e,oed (' the tech'o)o!3 o% ce*e't re#u)ted (' the de,e)o$*e't o% rotr3

()'# (' CC.

;oder' ce*e't (# the outco*e o% the co*b('ed re#erche# 'd de,e)o$*e't

e5ort# o% che*(#t#" tech'o)o!(#t# rch(tect# # +e)). The ce*e't tech'o)o!3 (#

' o5#hoot o% the o,er)) de,e)o$*e't (' other ('du#tr(e#" tech'o)o!3"

co'#truct(o') ct(,(t(e# 'd 'o+)ed!e (ded b3 the ,()b()(t3 o% r+ *ter().

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FOCUS OF THE RO!ECT

The $ro1ect (# #tructured %or the $ur$o#e o% !ett('! !ood ('#(!ht o%" :$(t)

Structure 'd :o#t o% :$(t)" theor3 'd (t# (*$)(ct(o'. The @ro1ect#

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T8e &ndian Ceent &ndu+try

The I'd(' :e*e't ('du#tr3 dte# bc to " +(th &r#t u'(t +# #et-u$

t @orb'dr +(th c$c(t3 o% === to'e#. :urre't)3The I'd(' ce*e't ('du#tr3

+(th tot) c$c(t3 o% bout = * to'e# 7e0c)ud('! *('( $)'t#8 (' =J o% the c$c(t3 re*('# $rett3 %r!*e'ted. @erc$(t co'#u*$t(o' h# ('cre#ed %ro* ?C ! (' C=-C to > ! (' ?==>. I'

re)t(,e ter*#" I'd(M# ,er!e co'#u*$t(o' (# #t()) )o+ 'd the $roce## o%

ctch('! u$ +(th ('ter't(o') ,er!e# +()) dr(,e %uture !ro+th. I'%r#tructure

#$e'd('! 7$rt(cu)r)3 o' rod#" $ort# 'd (r$ort#8" #$urt (' hou#('!

co'#truct(o' 'd e0$'#(o' (' cor$orte $roduct(o' %c()(t(e# (# )(e)3 to #$ur

!ro+th (' th(# re. South-E#t A#( 'd the ;(dd)e E#t re $ote't() e0$ort

*ret#. Lo+ co#t tech'o)o!3 'd e0te'#(,e re#tructur('! h,e *de #o*e o%

the I'd(' ce*e't co*$'(e# the *o#t e4c(e't cro## !)ob) *1or#. De#$(te

#o*e co'#o)(dt(o'" the ('du#tr3 re*('# #o*e+ht %r!*e'ted 'd *er!er 'd

c/u(#(t(o' $o##(b()(t(e# re #tro'!. I',e#t*e't 'or*# ('c)ud('! !u(de)('e# %or

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=->? *())(o' to'e#" ccord('! to the ''u) re$ort o% the De$rt*e't o%

I'du#tr() @o)(c3 'd @ro*ot(o' 7DI@@8. The re$ort re,e)# tht th(# !ro+th tre'd (#

be('! dr(,e' *(')3 b3 the e0$'#(o' o% e0(#t('! $)'t# 'd u#('! *ore 3 #h ('

the $roduct(o' o% ce*e't.

"ro9t8MarketingDeandTakeo;er

A !ro+th o% ?=J (' the ('#t))ed c$c(t3 o% ce*e't (' the $#t *o'th# h#

re#u)ted (' c$c(t3 out#tr($$('! curre't de*'d" %ee) ')3#t# 'd

*'u%cturer#.

The3 %ee) the ce*e't c3c)e h# $eed (' the cou'tr3 'd ce*e't *er# +())

%ce $re##ure o' $r(ce# 'd *r!('# throu!h the 3er 'd thu# +()) be )e##

('c)('ed to u'derte %urther c$c(t3 dd(t(o'. :e*e't ('du#tr3" ho+e,er" (#

)red3 o' (t# +3 to dd 'other ?= *())(o' to''e o% c$c(t3 th(# 3er.

The ('du#tr3 h# dded c$c(t3 hed o% de*'d. Tod3" +e h,e e'ou!h

c$c(t3 to *eet the de*'d %or the 'e0t o'e 'd h)% to t+o 3er#" #3# #hree

ce*e't ;D 'd :e*e't ;'u%cturer#M A##oc(t(o' $re#(de't H; B'!ur. The

('du#tr3 h# dded ? *t. o,er the $#t *o'th# to te the tot) c$c(t3 to

)(tt)e o,er ?== *t$. The !ro+th (' the c$c(t3 (# )*o#t doub)e tht o% the

e#t(*ted =J !ro+th (' de*'d o% ce*e't (' the #*e $er(od.

:e*e't +h(ch h# +e(!ht!e o% .J (' the +ho)e#)e $r(ce ('de0 h# bee' t

the ce'tre o% co'tro,er#3 %or the $#t o'e 3er" +(th !o,er'*e't ccu#('! the

*'u%cturer# o% co))ud('! to ee$ $r(ce# h(!h. W(th de*'d-#u$$)3 #(tut(o'

bout to ch'!e 'o+" $r(ce# +()) re*(' u'der $re##ure th(# 3er.

;e'+h()e" the $roduct(o' %or ;3 *r!('))3 dec)('ed to .C*t" # !('#t

>.= *t I' A$r()" )thou!h d(#$tche# ('cre#ed *r!('))3 %ro* . *t. to

.C> *t. (' the #*e $er(od. A:: 'd A*bu1" +h(ch re$orted )o+er d(#$tche#

(' ;3" b)*ed #ubdued de*'d %or th(#.

:e*e't ')3#t Ru$e#h S'he #3# ce*e't c3c)e h# reched (t# $e. The

;ret (# 'ot red3 to b#orb '3 h(e (' ce*e't $r(ce# 'd th(# (# #ure #(!' o%

the ce*e't c3c)e h,('! $eed. The d3# o% #u$er'or*) !ro+th %or the ce*e't

#ector re o,er. We +()) #ee !ro+th (' #)e# ,o)u*e (' th(# 3er but ('cre#e ('

('$ut co#t 'd do+'+rd $re##ure o' $r(ce# +()) ee$ *r!('# u'der $re##ure"

he #(d.

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A!ree# Shree :e*e'tM# B'!ur6 *r!('# +()) de&'(te)3 be )o+er. The ('$ut co#t

h# #hr$)3 ('cre#ed 'd (t c' 'ot be $##ed o' to the co'#u*er# %u))3.

The Economic

Times New

Delhi, 27.06.2008

CEMENT

:e*e't# re o% t+o b#(c t3$e#- !r3 ce*e't 'd +h(te ce*e't. Gre3

ce*e't (# u#ed o')3 %or co'#truct(o' $ur$o#e# +h()e +h(te ce*e't c' be $ut to

,r(et3 o% u#e#. It (# u#ed %or *o#(c 'd terr22o oor('! 'd cert(' ce*e't#

$('t#. It (# u#ed # $r(*er %or $('t# be#(de# h# ,r(et3 o% rch(tectur) u#e#.

The co#t o% +h(te ce*e't (# $$ro0(*te)3 three t(*e# tht o% !r3 ce*e't. Wh(te

ce*e't (# *ore e0$e'#(,e becu#e (t# $roduct(o' co#t (# *ore 'd e0c(#e dut3 o'

+h(te ce*e't (# )#o h(!her. Shree ce*e't doe# 'ot *'u%cture +h(te ce*e't t

$re#e't.

@o22o)o' u#ed (' the *'u%cture o% @ort)'d ce*e't (# bur't c)3 o% 3 #h

!e'erted t ther*) $o+er $)'t#. @@: (# h3dru)(c ce*e't. @@: d(5er# %ro*

O@: o' 'u*ber o% cou't#. @o22o)o' dur('! *'u%ctur('! co'#u*e# )ot o%h3drt(o' het 'd %or*# ce*e't(ou# !e)M. Reduced het o% h3drt(o' )ed# to

11

GREY WHITE

Portland Pozzolona Cement

"rd#nar$ Portland %ement

CE&E'T

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)e##er #hr('!e crc#. A' dd(t(o') !e) %or*t(o' )ed# to )e##er $ore# ('

co'crete or *ortr. It )#o *('(*(2e# $rob)e* o% )ech('! 'd eore#ce'ce.

.

Type+ o, ceent in &ndia

The ce*e't (' I'd( h# ('cre#ed o,er the 3er# +(th the d,'ce*e't ('

re#erch" de,e)o$*e't" 'd tech'o)o!3. The I'd(' ce*e't ('du#tr3 (# +(t'e##('!

boo* # re#u)t o% +h(ch the $roduct(o' o% d(5ere't ('d# o% ce*e't (' I'd(

h# )#o ('cre#ed.

B3 %(r e#t(*te" there re rou'd d(5ere't t3$e# o% ce*e't tht re be('!

$roduced (' I'd(. So*e o% the ,r(ou# t3$e# o% ce*e't $roduced (' I'd( re6

:)('er :e*e't "Ord('r3 @ort)'d :e*e't "@ort)'d B)#t

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co'#truct(o' o% (r$ort# 'd br(d!e#. The $roduct(o' o% +h(te ce*e't (' the

cou'tr3 (# ,er3 )e## %or (t (# ,er3 e0$e'#(,e (' co*$r(#o' to !re3 ce*e't. I'

I'd(" +h()e ce*e't (# u#u))3 ut()(2ed %or decort(,e $ur$o#e#" *rb)e %ou'dt(o'

+or" 'd to &)) u$ the !$# bet+ee' t()e# o%

The d(5ere't t3$e# o% ce*e't (' I'd( h,e re!(#tered ' ('cre#e (' $roduct(o'(' the )#t %e+ 3er#. E5ort# *u#t be *de b3 the ce*e't ('du#tr3 (' I'd( 'd

the !o,er'*e't o% I'd( to e'#ure tht the ce*e't ('du#tr3 co't('ue# (''o,t(o'

'd re#erch to co*e u$ +(th *ore 'd *ore ,r(et(e# (' the 'er %uture

Port)and ceent

@ort)'d ce*e't" the b#(c ('!red(e't (' co'crete" +# &r#t $roduced 'd

$te'ted (' C? b3 Br(t(#h #to'e*#o'. Tod3 rou'd == *())(o' to'e# o%

ce*e't re u#ed e,er3 3er" +(th d(5ere't t3$e# *'u%ctured to *eet ,r(ou#

che*(c) 'd $h3#(c) re/u(re*e't#. To $roduce the#e re/u(re# c)er

u'der#t'd('! 'd cre%u) co'tro) o% the *'u%ctur('! $roce##e#.

A)thou!h the ter*# ce*e't 'd co'crete o%te' re u#ed ('terch'!eb)3"

ce*e't (# ctu))3 ' ('!red(e't o% co'crete. @ort)'d ce*e't (# 'ot br'd

'*e" but the !e'er(c ter* %or the t3$e o% ce*e't u#ed (' ,(rtu))3 )) co'crete"

1u#t # #t(')e## (# t3$e o% #tee) 'd #ter)('! t3$e o% #(),er. @ort)'d ce*e't

o+e# both (t# '*e 'd or(!(' to 9o#e$h A#$d('" Br(t(#h #to'e *#o'. A#$d('P#

/ue#t %or *'u%ctured cou'ter$rt to 'tur) or Ro*' ce*e't - crude

%or*u)t(o' o% )(*e 'd ,o)c'(c #h u#ed # er)3 # ? B: - )ed to h(# d(#co,er3

'd $te't o% @ort)'d ce*e't (' C?.

A#$d(' heted *(0ture o% &'e)3 $o+dered )(*e#to'e 'd c)3 (' #*)) %ur'ce

to $roduce h3dru)(c ce*e't - o'e tht +ou)d hrde' +(th the dd(t(o' o% +ter.

He '*ed h(# (',e't(o' Q@ort)'d ce*e'tQ 'ot o')3 to d(#t('!u(#h (t %ro* Ro*'

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ce*e't" but )#o # *ret('! too)6 :o'crete *de %ro* h(# 'e+ ce*e't

re#e*b)ed h(!h)3 $r(2ed bu()d('! #to'e /urr(ed o' the I#)e o% @ort)'d o5 the

Br(t(#h co#t. Tod3P# @ort)'d ce*e't #t()) re)(e# o' A#$d('P# r+ *ter()# %or (t#

b#(c co*$o'e't# o% c)c(u*" #()(c" )u*('" 'd (ro'. The *o#t co**o'

co*b('t(o' (# )(*e#to'e" c)3.

T8e Ceent &ndu+try Structure

@re#e't)3 the tot) ('#t))ed c$c(t3 o% I'd(' :e*e't I'du#tr3 (# *ore th' >

*' to'e# $er ''u*" +(th $roduct(o' rou'd C ** to'e# . The +ho)e

ce*e't ('du#tr3 c' be d(,(ded ('to ;1or ce*e't $)'t# 'd ;('( ce*e't $)'t#.

Major Ceent P)ant+: @)'t# 6 =

T3$(c) ('#t))ed c$c(t3

@er $)'t 6 Abo,e .> *'t$

Tot) ('#t))ed c$c(t3 6 = *'t$

@roduct(o' =-=C6 *'t$

A)) I'd( rech throu!h *u)t($)e $)'t#

E0$ort to B'!)de#h" Ne$)" Sr( L'" UAE 'd ;ur(t(u#

Stro'! *ret('! 'et+or" t(e-u$# +(th cu#to*er#" co'trctor#

W(de #$red d(#tr(but(o' 'et+or .

S)e# $r(*r()3 throu!h the de)er ch''e)

Mini Ceent P)ant+: Ner)3 == $)'t# Locted (' Gu1rt" R1#th'" ;@ *(')3

T3$(c) c$c(t3 ?== t$d

I'#t))ed c$c(t3 rou'd *'. To'e#

@roduct(o' rou'd 6 .? *' to'e#

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;('( $)'t# +ere *e't to t$ #cttered )(*e#to'e re#er,e#. Ho+e,er *o#t

#et u$ (' A@

;o#t u#e ,ert(c) ()' tech'o)o!3

@roduct(o' co#t F to''e R#. "=== to "==

@re#e'ce o% the#e $)'t# )(*(ted to the #tte I'%r#tructur) %c()(t(e# 'ot the be#t

Regiona) di;i+ion

The I'd(' ce*e't ('du#tr3 h# to be ,(e+ed (' ter*# o% &,e re!(o'#6-

North 7@u'1b" De)h(" Hr3'" H(*ch) @rde#h" R1#th'" :h'd(!rh"

9K 'd Uttr'ch)8

We#t 7;hr#htr 'd Gu1rt8

South 7T*() Ndu" A'dhr @rde#h" Kr't" Ker)" @o'd(cherr3"

A'd*' N(cobr 'd Go8

E#t 7B(hr" Or(##" We#t Be'!)" A##*" ;e!h)3" 9hrh'd 'd

:hhtt(#!rh8 'd

:e'tr) 7Uttr @rde#h 'd ;dh3 @rde#h8.

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C8aracteri+tic+ o, Ceent &ndu+try

Th(# #ect(o' de#cr(be# the b#(c eco'o*(c chrcter(#t(c# o% the ce*e't ('du#tr3

b3 %o))o+('! the c)##(c) $$roch +h(ch co'#(#t# o% #ucce##(,e)3 e0*('('!

de*'d" #u$$)3 'd *ret #tructure. O' the b#(# o% the#e chrcter(#t(c# re

de#cr(bed the *(' eco'o*(c #te# (' the #ector.

Deand *Market

De*'d (' the ce*e't ('du#tr3 (# t3$(c))3 tht o% ' ct(,(t3 +h(ch (# *ture"

c3c)(c) 'd +(th )o+ $r(ce e)#t(c(t3. It (# )#o chrcter(2ed b3 h(!h de!ree o%

hor(2o't) d(5ere't(t(o' (' ter*# o% )oct(o' 'd )o+ de!ree o% ,ert(c)

d(5ere't(t(o' (' ter*# o% /u)(t3.

:e*e't (# ho*o!e'eou# $roduct. ;o#t o% (t# #)e# co'cer' bout h)% do2e'

co**erc() ,r(et(e#" o% +h(ch @ort)'d ce*e't (# b3 %r the )eder. No br'd

'*e e0(#t#" #o tht o'e #u$$)(erM# $roduct# c' e#()3 be #ub#t(tuted %or 'other.

:e*e't (#" ho+e,er" ' e0$er(e'ce !ood (t# /u)(t3 (# !ur'teed b3 #t'drd#

+(th +h(ch the #u$$)(er h# to co*$)3. The#e #t'drd# re o%te' 't(o') but ('

*o#t c#e# the $roduct# o% o'e cou'tr3 c' e#()3 be $$ro,ed (' 'e(!hbor('!

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cou'tr(e#. St'drd# there%ore do 'ot co'#t(tute trde brr(er# # #uch" e,e' (%

the3 *3 h('der trde.

The de*'d %or ce*e't (# !eo!r$h(c))3 +(de)3 d(#$er#ed 'd corre#$o'd#

rou!h)3 to $o$u)t(o' de'#(t3. A)thou!h ce*e't (# ' u$#tre* ('du#tr3" (t d(5er#%ro* other b#(c ('du#tr(e# #uch # )u*('u*" #tee) or !)##" %or +h(ch de*'d (d

co'ce'trted both !eo!r$h(c))3 'd (' ter*# o% the 'u*ber o% cu#to*er#. I'

the ce*e't ('du#tr3 de*'d (# b3" b3 co'tr#t" d(#$er#ed (' *u)t($)e 2o'e# o%

co'#u*$t(o'" ech o% +h(ch co*$r(#e# 'u*erou# cu#to*er#. Geo!r$h(c)

%ctor# thu# deter*('e the #tructure o% the *ret.

Supp)y

T+o eco'o*(c co'#(dert(o'# re (*$ort't $r(or( (' #tructur('! #u$$)3 ('

*ret chrcter(2ed b3 #tro'! hor(2o't) d(5ere't(t(o'6

The trde-o5 bet+ee' &0ed co#t# 'd tr'#$ort co#t# +h(ch" de$e'd('! o'the eco'o*(c #(2e o% the %ctor(e#" !(,e# ' ('(t() (de o% the de'#(t3 o% the

'et+or o% $roduct(o' u'(t# co,er('! the terr(tor3" (' re)t(o' to the de'#(t3

o% de*'d.

The )e,e) o% (',e#t*e't co#t# 'd the )(%e-#$' o% %c()(t(e# +h(ch deter*('e

the r(!(d(t3 'd the durt(o' o% the 'et+or.

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Major Deand Dri;er+

Pre+ent Deand dri;er+

I'%r#tructure co'#truct(o' #ector the *1or de*'d dr(,er#. So*e de*'d

deter*(''t#

Eco'o*(c !ro+th

I'du#tr() ct(,(t3

Re) e#tte bu#('e##

:o'#truct(o' ct(,(t3

I',e#t*e't# (' the core #ector

Gro+th (' *ort!!e bu#('e## (' ret() hou#('!

H(!her #ur$)u# ('co*e o% hou#eho)d

Opportunitie+ !ro+th (' the hou#('! #ector

ce'tr) rod %u'd e#tb)(#hed %or 't(o') h(!h+3# 'd r()+3 o,er

18

E"#ected $e%and and Su##ly

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br(d!e# to $ro,(de the 'ece##r3 (*$etu#

e0$'#(o' $)'#" Gree'&e)d $ro1ect# o' the ',()

De*'d #u$$)3 b)'ce e0$ected (' the 'e0t ? > *o'th#

E'cour!('! tre'd (' de*'d due to $(c-u$ (' rur) hou#('! de*'d 'd

('du#tr() re,(,) I'du#tr3 )(e)3 to !ro+ t C-=J (' the 'e0t %e+ 3er#

Ne+er c$c(t(e# (' %uture

Major P)ayer+ in Ceent &ndu+try

Major P)ayer+ in Ceent &ndu+try:

Shree

A*bu1

A::

The Ad(t3 B(r) Grou$

B(''(

9.K

Other#

Tod3 I'd( (# the #eco'd )r!e#t ce*e't $roducer 7%ter :h('8 (' the +or)d.

S8reeShree :e*e't# Ltd. (# R1#th' b#ed co*$'3" )octed t Be+er. The

co*$'3 h# ('#t))ed c$c(t3 o% .C?> *' to'e# $er ''u*7 o$c b#(# 8('

R1#th'.

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bo,e the '*e $)te c$c(t3. The co*$'3 ret('# (t# $o#(t(o' # 'orth I'd(M#

)r!e#t #('!)e-)oct(o' *'u%cturer. ShreeM# $r('c($) ce*e't co'#u*('!

*ret# co*$r(#e R1#th'" De)h(" Hr3'" @u'1b" Uttr @rde#h 'd

Uttr'ch). Shree *'u%cture# Ord('r3 @ort)'d :e*e't 7O@:8 'd @ort)'d

@o22o)' :e*e't 7@@:8. It# out$ut (# *reted u'der the Shree U)tr Ord('r3

@ort)'d :e*e'tM 'd Shree U)tr Red O0(de 9u'! Rodh:e*e'tM br'd '*e#.A-uja

GA:L +# #et u$ (' C +(th =. *())(o' to'e#. The c$c(t3 h# !ro+' ?> t(*e#

#('ce the' to C.> *())(o' to'e#. GA:L e0$ort# # *uch # > $erce't o% (t#

$roduct(o'. Th(rt3 &,e $er ce't o% the co*$'3M# $roduct# tr'#$orted re b3 #e

+h(ch (# the che$e#t *ode. It h# er'ed the re$utt(o' o% be('! the )o+e#t co#t

$roducer (' the ce*e't ('du#tr3. A*bu1 ce*e't o'e o% GA:LM# +e)) e#tb)(#hed

br'd#. The co*$'3 $)'# to ('cre#e c$c(t3 b3 - *())(o' to'e# (' the 'er

%uture.

ACC

Be('! %or*ed (' " A:: h# c$c(t3 o% ??.= *())(o' 7 ('c)ud('! =.> *())(o'

to'e# o% D*odr :e*e't 'd S)! 'd =. *())(o' to'e# o% Br!rh :e*e't 8.

A:: Su$er (# o'e o% the co*$'3M# +e)) e#tb)(#hed br'd#. It (# $)''('! to

e0$'d the c$c(t3 o% (t# +ho))3-o+'ed #ub#(d(r3 D*odr ce*e't 'd S)! t

@uru)( (' We#t Be'!). Th(# (# (*ed t ('cre#('! (t# $re#e'ce (' the e#ter'

re!(o'.

A# o'

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+h(te ce*e't $)'t t Khr( Kh'!r 7R1.8 Shree D(!,(13 :e*e't" #ub#(d(r3

o% Gr#(*" +h(ch +# c/u(red (' C" h# (t# ('te!rted !re3 ce*e't $)'t t

S( 7Gu1rt8.

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LT (# #tro'! $)3er 't(o'))3 'd re!rded # /u)(t3 $roduct. It h#

%oot$r('t but 'ot %ootho)d (' R1#th' *ret.

"ro9t8 pat8 o, &ndian ceent indu+try

H(!h de*'d !ro+th (' ce'tr)" +e#t 'd 'orth re!(o'# h,e )ed de*'d !ro+th

(' &r#t C *o'th# o% ?==-= e'd('! No, ?==. Boo* (' hou#('! 'd ('%r#tructure

(' ce'tr)" 'orth 'd +e#t re!(o'# h,e u!ured ce*e't de*'d. A*o'! #tte#

Uttr'ch) h# +(t'e##ed de*'d !ro+th o% ?J %o))o+ed b3 :hhtt(#!rh +(th

!ro+th o% ?J 'd Kr't +(th !ro+th o% ? J re#$ect(,e)3 dur('! the

#*e $er(od. I' #outh re!(o' !ro+th +# )ed b3 $(c u$ (' co'#truct(o' ct(,(t(e#

$o#t *o'#oo'#.

22

Re&ion 'ise de%and &ro't

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&NTROD#CT&ON :

A!O#T THE OR"AN&SAT&ON

S8ree Ceent Liited(# Be+r b#ed co*$'3" )octed (' R1#th'. The

:o*$'3 (# $rt o% the B'!ur Grou$ 'd +# ('cor$orted o' ?>th

October" t 9($ur +(th 6i+ion: orda-)e price.? :o**erc()

$roduct(o' co**e'ced %ro* #t ;3C> +(th ('#t))ed c$c(t3 o% )c#

to'e# $er ''u* (' Be+r d(#t. A1*er" the c$c(t3 o% th(# $)'t +# u$!rdedto . )c# to'e# $er ''u* dur('! -> b3 *oder'(2t(o' 'd u$

!rdt(o' $ro!r**e. I' > - The :o*$'3 u'dertoo the (*$)e*e'tt(o' o%

'e+ u'(t o% .? ;T c$c(t3 $er ''u* '*ed QR1 :e*e't. I' The

:o*$'3 co**(##(o'ed (t# #eco'd ce*e't $)'t - R1 :e*e't +(th c$c(t3 o% ?.

)c# to'e# $er ''u* d1ce't to (t# e0(#t('! $)'t (' order to te %u))

d,'t!e o% (t# e0(#t('! ('%r#tructure 'd )red3 de,e)o$ed c$t(,e *('('!

)e#e e'ou!h to #u#t(' 'e+ ce*e't $)'. The cu*u)t(,e c$c(t3 +#e'h'ced b3 de-bott)e'ec('! 'd b)'c('! e/u($*e't (' Dece*ber ?== to

?. ;T@A. A $roduct c))ed Tu5 :e*e'to h# )#o )u'ched b3 the co*$'3 ('

23

Ca#acity ddition

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A$r() ?==. At $re#e't co*$'3 (# $roduc('! o,er ==J c$c(t3 ut()(2t(o'" (t (#

the )r!e#t #('!)e )oct(o' ce*e't $roducer (' 'orth I'd( 7#(0th (' cou'tr38.

S8ree Ceent Liited (# o'e o% the %#te#t !ro+('! :e*e't

:o*$'(e# (' I'd(. @re#e't)3 Shree :e*e't h# . ;T@A c$c(t3 (' three

$)'t# 7Shree (' Be+r ?. ;T@A" R# (' @)( D(#tr(ct ;T 'd Khu#hher

c$c(t3 (# .> ;T@A8 The or!'(2t(o' h# $er%or*ed e0ce$t(o'))3 +e)) (' the

3er ?==-=C ('cre#('! the @BT b3 >J the re#o'# %or th(# re*rb)e

ch(e,e*e't 'd e3 #tre'!th# o% the co*$'3 re d(#cu##ed (' the re$ort.

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:hrt 6 Shreho)d('! @tter' o% Shree :e*e't

EUIT :A@ITAL .C :rore#

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T8e S8ree 6i+ion @

To be o'e o% the I'd(M# *o#t re#$ected e'ter$r(#e throu!h be#t-('-c)##

$er%or*'ce 'd )ed('! b3 )o+ crbo' $h()o#o$h3 *('! (t $ro!re##(,e

or!'(2t(o' tht )) #teho)der# $roud to de) +(th.

T8e S8ree Mi++ion @

The co*$'3 co't('ue# to be o'e o% the *o#t o$ert(o'))3 e4c(e't 'd e'er!3

co'#er,('! ce*e't# $roducer# (' the +or)d. It# *(##(o' #tte*e't (#

To hr'e## #u#t('b()(t3 throu!h )o+-crbo' $h()o#o$h3 To #u#t(' (t# re$utt(o' # o'e o% the *o#t e4c(e't *'u%cture !)ob))3.

To co't('u))3 h,e *o#t e'!!ed te*.

To co't('u))3 dd ,)ue to (t# $roduct# 'd o$ert(o' *eet('! e0$ectt(o'#

o% )) (t# #teho)der#.

To co't('u))3 bu()d 'd u$!rde #())# 'd co*$ete'c(e# o% (t# hu*'

re#ource %or !ro+th

To be re#$o'#(b)e cor$orte c(t(2e' +(th tot) co**(t*e't to co**u'(t(e#

(' +h(ch (t o$erte# 'd #oc(et3 t )r!e.

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Origin o, t8e Copany:

@ro*oted b3 the B'!ur Grou$" Shree :e*e't# (# the )r!e#t ce*e't $roducer ('

R1#th'. The co*$'3 h# tot) ('#t))ed c$c(t3 o% .C?> *())(o' to''e 7o$cb#(#8The $)'t# re #trte!(c))3 )octed (' ce'tr) R1#th'" %ro* +here (t c'

cter to the e't(re R1#th' *ret # +e)) # De)h( 'd Hr3'. The co*$'3

h# bout == #)e# o4ce# #$red cro## the #tte# o% R1#th'" Uttr @rde#h"

Uttr'ch)" De)h(" Hr3'" @u'1b 'd 9**u K#h*(r. It# ce*e't (#

*reted u'der the br'd '*e o% Shree U)tr :e*e't +(th d(5ere't !rde#

)(e " 'd > 'd #ub-br'd '*e# )(e Qred o0(de ce*e'tQ" Q9u'! Rodh

:e*e'tQ" etc.

Shree :e*e't Ltd 7S:L8 (# )octed t Be+re" R1#th'" I'd(M# )r!e#t ce*e't

$roduc('! #tte. It +# ('cor$orted (' . :o**erc() $roduct(o' t (t# =.

*())(o' to'e# $er ''u* 7t$8 ce*e't $)'t (' R1#th' co**e'ced (' ;3

C>. Three co*$'(e# o% the B'!or !rou$ $ro*oted S:L. The#e co*$'(e# re

Shree D(! V(13 :o*$'3 Ltd" Gr$h(te I'd( Ltd 'd

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Shree cter# to ce*e't de*'d r(#('! (' R1#th'" De)h(" Hr3'" U@ 'd

@u'1b. Wht (# #trte!(c %or S:L (# tht (t (# )octed (' ce'tr) R1#th' #o (t

c' cter to the e't(re R1#th' *ret +(th the *o#t eco'o*(c )o!(#t(c#

co#t. A)#o" Shree :e*e't (# the c)o#e#t $)'t to De)h( 'd Hr3' *o'! ))

ce*e't *'u%cturer# (' (t# #tte 'd $ro0(*(t3 to the#e $ro&tb)e ce*e't*ret# re'der# the co*$'3 ' ed!e o,er other ce*e't co*$'(e# o% the

co*$'3 (' ter*# o% )o+er %re(!ht co#t#. ShreeM# tot) c$t(,e $o+er $)'t

c$c(t3 tod3 #t'd# t =.> ;W. I' ?===-=" the co*$'3 h# #ucceeded

(' #ub#t(tut('! co',e't(o') coe +(th == $er ce't $et coe" +#te %ro*

re&'er(e#" # $r(*r3 %ue) re#u)t('! (' )o+er (',e'tor3 'd ('$ut co#t#. I' the

$#t t+o 3er# the $r(ce o% co) h# !o'e u$. Er)(er de$e'de't o' !ood

/u)(t3 (*$orted co)" the co*$'3P# #+(tch to $et coe cou)d 'ot h,e co*et better t(*e. The co*$'3 )#o re$)ced ('d(!e'ou# re%rctor3br(c#

+(th (*$orted #ub#t(tute#" reduc('! (t# co'#u*$t(o' $er to''e o% c)('er. The

co*$'3 h# o'e o% the *o#t e'er!3 e4c(e't $)'t# (' the +or)d. The

c$t(,e $)'t !e'erte# $o+er t co#t o% R# .> $er u'(t 7e0c)ud('! ('tere#t

'd de$rec(t(o'8 # co*$red to o,er Re#t > $er u'(t %ro* the !r(d. I'

$$rec(t(o' o% (t# ch(e,e*e't# (' E'er!3 #ector" the :o*$'3 h# bee'

+rded the $re#t(!(ou# PNt(o') E'er!3 :o'#er,t(o' A+rdQ %or the 3er

. Shree (# rted be#t b3 Wh(teho$)e*'" ' ('ter't(o') !e'c3

#$ec()(2('! (' the rt('! o% ce*e't $)'t#.

@RODU:TS

4o))o9ing are t8e ;ariou+ product+ o, S8ree Ceent+ Ltd.

2 S8ree #)tra Red Oide 'ung Rod8ak Ceent ROC(0 !angur Ceent/ Tu> Cee

nto

28

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Market C)a++iBcation o, S8ree

Market+ c)a++iBcation

Market+ State+

Priary Raja+t8an

Seconda

ry

De)8i$ Punja-$ 'au and 5a+8ir$ Haryana$

%e+tern #.P. and #ttaranc8a)

Tertiary "ujarat$ M.P. and Centra) #.P.

State 2006-07 2007-08 2008-09

Raja+t8an .J ?=.J ??.J

Haryana .>J .=J ?.J

De)8i .J .J .J

Punja- >.J .?J C.?J

#.P. ?.=J .CJ .CJ

#ttaranc8a) .?J .J =.J

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Epan+ion o, S8ree

The ,r(ou# u'(t# o% Shree )octed cro## Norther' I'd( re6

#N&T 3 2

I'cor$orted (' t B'!ur N!r.

@ut u$ (' C>.

:e*e't @roduct(o' 7E0$ected @roduct(o'8 .?= *())(o' to''e#

#N&T 3 0

@ut-u$ (' t B'!ur N!r.

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:e*e't @roduct(o' 7E0$ected @roduct(o'8 ?.= *())(o' to''e#

#N&T @ /

I'cor$orted (' ?==> t R#.

:e*e't @roduct(o' 7E0$ected @roduct(o'8 .>= *())(o' to''e#

#N&T @

Locted (' R#.

:e*e't @roduct(o' 7E0$ected @roduct(o'8 .>= *())(o' to''e#

#N&T 3

Locted (' R# 7:o'#truct(o' Wor (' @ro!re##8.

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M#LT&PLE COMPET&T&6E !RANDS

I'c(#(,e e0ecut(o' o% ShreeM# *u)t($)e co*$et(t(,e br'd #trte!3 h# bee'

de)(,er('! re#u)t# )o'! 't(c($ted )('e#. :o'#(#te'c3 (' br'd #trte!3 (# he)$('!

Shree to #u#t(' (t# br'd# h,('! )#t('! (*$re##(o' *o'! (t# co'#u*er#.

The #ted3 !ro+th (' ShreeM# ,o)u*e e#$ec())3 3er-o' 3er (' the )#t t+o

c)#" te#t(&e# to the e5ect(,e'e## o% (t# *u)t( br'd *ret('! #trte!3.

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SHREE #LTRA

Lu'ched (' ?==?" Shree U)tr +# the co*$'3M# &r#t br'd" the &r#t

*'(%e#tt(o' o% ShreeM# #trte!(c *o,e %ro* co**od(t3 to br'd *ret('!.

It# !e'er(c O@: ,er#(o' h# bee' 1o('ed b3 ,r('t" Shree U)tr 9u'! Rodh" o'

the %u'ct(o') d(5ere't(tor o% ru#t $re,e't(o'. To!ether t+o ,r('ce h,e *de

Shree U)tr the !#h($ br'd o% the co*$'3" co'tr(but('! h)% o% the ShreeM#

tot) #)e#.

The br'd +# )u'ched +(th $o+er%u) *ed( 'd $ro*ot(o') #u$$ort" the

(*!('t(,e d,ert(#('! 'd the *o*e'tu* h# c)er)3 #u#t('ed (tM# !ro+th o,er

t(*e.

Tod3 (t (# $re#e't )) o% Shree :e*e'tM# *ret terr(tor(e#. I' =-=C (t ch)ed u$

(t# h(!he#t ,o)u*e# (' the ho*e *ret o% R1#th'" 'd (' the N:R" the *('%ocu# o% the co'#truct(o' boo* (' 'orth I'd(.

O,er))" Shree U)tr ,o)u*e# reect (t# cce$t'ce b3 $ro%e##(o') ('ue'cer#.

Wh(ch (' tur' %c()(t(e# cce$t'ce b3 do*e#t(c co'#u*er#. The(r #u$$ort" # +e))

# #u#t('ed )oc) $ro*ot(o'#" h# he)$ed to (*$ro,e br'd rec))" 'd $re$red

the !rou'd %or %re#h ('(t(t(,e# (' the *ret $)ce.

!AN"#R CEMENT

B'!ur :e*e't +# )u'ched (' ?== # $re*(u* br'd" co*$et(t(,e +(th be#t

(' the *ret de#(!'ed to %u)) &)) u#er #$(rt(o' %or h(!h /u)(t3 co'#truct(o' the

br'd t!)('e reect# (t# $ro*(#e o% to$-o%-*ret ,)ue6 S#t Nh(" Sb#e

Achch.

G(,e' the $re*(u* $ro&)e de#(!' %or (t the br'd (# #u$$orted b3 *tch('!

'et+or o% bu#('e## $rt'er# 'd bu#('e## ##oc(te# cre%u))3 #e)ected %or the

trc record (' #e))('! to h(!h e'd *ret #e!*e't.

It# er)3 #ucce##e# re %ou'ded o' t+o t(er *ret('! 'd d(#tr(but(o'

$ro!r**e. At o'e )e,e) ShreeM# &e)d %ort# te# the trde# (' to the co'&de't

+(th tr'#$re't ter*# 'd te#ted 'd $ro,e' $ro*ot(o') o5er('!#.

O' *ore e0c)u#(,e )e,e)" (t de$)o3# #$ec() te*# o% h(!h)3 $ro%e##(o')

tech'(c) #)e# e0$ert# t co'duct d(rect" o'e o' o'e ('terct(o' +(th o$('(o'

bu()der# 'd ('ue'cer# (% h(!h #t'd('! *o'! the %rter'(t3 o% re#$ected

co'#truct(o' #$ce )(#t.

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B'!ur :e*e't h# ch(e,ed >J o% (t# tot) #)e# (' the trde #e!*e't. It h#

*de #e)ect(,e $e'etrt(o' (' both urb' 'd rur) *ret#. B'!ur ce*e't

*('t('ed (t# 2ero out#t'd('! #ttu# (' th(# 3er # +e)).

T#44 CEMENTO

Th(# (# the )te#t br'd o5er('! %ro* Shree :e*e't" d(rected t h(!h)3

co*$et(t(,e '(che *ret" +(th !!re##(,e 'd e#tb)(#h co*$et(tor#.

It h# bee' $o#(t(o' # roc #tro'!- o' the $ro*(#e o% h(!h $er%or*'ce" b)e to+(th#t'd e0ce$t(o'))3 hr#h e',(ro'*e't) co'd(t(o'#.

Lu'ched (' the &r#t *o'th o% the 3er u'der re,(e+" Tu5 :e*e'to +# b)e to

#ecure 'et+or o% the === d3'*(c 'd re#ource%u) de)er# (' record t(*e o%

bout %our *o'th#.

The br'd (# co'#o)(dted (t# $o#(t(o' (' the *ret" 'd the *('! %urther

hed+3 (' R1#th'" De)h(" Hr3'" $rt# o% #outh @u'1b 'd We#ter' U.@.

Wh()e (t# curre't #ttu# +ou)d other+(#e be re!rded # re#o'b)e. Tu5:e*e'to h# ' )to!ether *ore *b(t(ou# !e'd6 to be !!re##(,e)3

co*$et(t(,e 'd beco*e )ed('! br'd (' the co*('! *o'th#" 'd to e'b)e

Shree :e*e't to ch(e,e the *0(*u* $o##(b)e co*b('ed *ret #hre (' (t#

*ret.

POL&C&ES:

Fua)ity Po)icy:

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To $ro,(de $roduct# co'%or*('! to 't(o') #t'drd# 'd *eet('!

cu#to*er# re/u(re*e't# to the(r tot) #t(#%ct(o'.

To co't('u))3 (*$ro,e $er%or*'ce 'd e5ect(,e'e## o% /u)(t3

*'!e*e't #3#te* b3 #ett('! 'd re,(e+('! /u)(t3 ob1ect(,e# %or6

:u#to*er St(#%ct(o'

:o#t E5ect(,e'e##

Energy Po)icy:

To reduce to the *0(*u* e0te't $o##(b)e the co'#u*$t(o' o% e'er!3

+(thout (*$rt('! $roduct(,(t3 +h(ch #hou)d he)$ ('6

I'cre#e (' the $ro&tb()(t3 o% the co*$'3

:o'#er,t(o' o% E'er!3

Reduct(o' (' E',(ro'*e't) $o))ut(o' t e'er!3 $roduc('! re# S('ce

E'er!3 (# B)ood o% I'du#tr3" It (# the re#$o'#(b()(t3 o% )) o% u# to ut()(2e

e'er!3 e5ect(,e)3 'd e4c(e't)3M

En;ironent Po)icy:

To e'#ure 6

:)e'" !ree' 'd he)th3 e',(ro'*e't

E4c(e't u#e o% 'tur) re#ource#" e'er!3" $)'t 'd e/u($*e't

Reduct(o' (' e*(##(o'#" 'o(#e" +#te 'd !ree'hou#e !#e#

:o't('u) (*$ro,e*e't (' e',(ro'*e't *'!e*e't

:o*$)('ce o% re)e,'t e',(ro'*e't) )e!(#)t(o'

%ater Po)icy:

To $ro,(de #u4c(e't 'd #%e +ter to $eo$)e $)'t # +e)) # to co'#er,e

+ter" +e re co**(tted to e4c(e't +ter *'!e*e't $rct(ce# ,(2"

De,e)o$ *e'# *ethod# %or +ter hr,e#t('!

Tret*e't o% +#te d(#chr!e +ter %or reu#e

Educte $eo$)e %or e5ect(,e ut()(2t(o' 'd co'#er,t(o' o% +ter

Wter ud(t re!u)r *o'(tor('! o% +ter co'#u*$t(o'

Hea)t8 * Sa,ety Po)icy:

To e'#ure !ood he)th 'd #%e e',(ro'*e't %or )) co'cer'ed b36

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@ro*ot('! +re'e## o' #ou'd he)th 'd #%e +or('! $rct(ce#

:o't('u))3 (*$ro,('! he)th 'd #%et3 $er%or*'ce b3 re!u)r)3 #ett('!

'd re,(e+('! ob1ect(,e# Tr!et#

Ide't(%3('! 'd *('(*(2('! ('1ur3 'd he)th h2rd# b3 e5ect(,e r(#

co'tro) *e#ure#

:o*$)3('! +(th )) $$)(cb)e )e!(#)t(o'# 'd re!u)t(o'#M

Huan Re+ource Po)icy:

We t Shree :e*e't re co**(tted to

E*$o+er @eo$)e

Ho'our ('d(,(du)(t3

No' d(#cr(*('t(o' (' recru(t*e't $roce##

De,e)o$ :o*$ete'c3

E*$)o3ee# #h)) be !(,e' e'ou!h o$$ortu'(t3 %or better*e't

No'e o% the $er#o' be)o+ the !e o% C 3er# #h)) be e'!!ed to +or

I'c(de'ce o% Se0u) Hr##*e't #h)) be ,(e+ed #er(ou#)3

Sttute e'cted #h)) be ho'oured (' )etter #$(r(t #t'drd Lbour

@rct(ce# #h)) be %o))o+ed. E,er3 e*$)o3ee #h)) be ccou'tb)e to the )+

o% the )'d (# e0$ected to %o))o+ the #*e +(thout '3 de,(t(o'

;'!e*e't +()) $$rec(te ob#er,'ce o% Bu#('e## eth(c# $ro%e##(o')

code o% co'duct

To %o))o+ #%et3 He)th. u)(t3" E',(ro'*e't" E'er!3 @o)(c3M

&T Po)icy:

To $ro,(de robu#t IT $)t%or* #u(tb)e to the bu#('e## $roce##e# 'd ('te!rted

*'!e*e't $rct(ce# o% the co*$'3" re#u)t('! ('to better #$eed" e4c(e'c3"

tr'#$re'c3" ('ter') co'tro)# 'd $ro&tb()(t3 o% bu#('e##M

Copany Per,orance * A9ard+:A+rd# Reco!'(t(o'# rece(,ed (' =-=C

Go)de' @ecoc A+rd# %or e0ce))e'ce E',(ro'*e't ;'!e*e't @rct(ce#.

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Go)de' @ecoc A+rd# %or e0ce))e'ce (' :or$orte Go,er''ce ('

*'u%ctur('! #ector.

Gree'tech E',(ro'*e't e0ce))e'ce Go)d A+rd# %or e0ce))e't E',(ro'*e't

;'!e*e't @rct(ce#.

Nt(o') +rd %or e0ce))e'ce (' Wter ;'!e*e't # Wter e4c(e't

U'(t b3 :II" ?==.

Nt(o') +rd %or E'er!3 :o'#er,t(o' b3 Bureu o% E'er!3 E4c(e'c3.

Trade and Non3Trade Net9ork+

There re t+o t3$e# o% Net+or#6 Trade and Non3trade

a) Non-trade Network

Non3trade Net9ork:

) Trade Network

Copany Hand)ing Agent Stockie+t Retai)er+

Con+uer+

37

*o+t. ,on-trade ri+ate ,on-trade

( )or Gro*+ ,o*-#n. / reta#l

,o*-#n.

( %ontra%tor- +roe%t- on

e,al) o) .ot( n$ #nd*-tr#al +roe%t-

taen *+ $ t,e +r#ate

-e%tor l#e r#d.e- road-

et%

( )or .ot #n)ra-tr*%t*re

*#ld#n.

( Got Ho*-#n. Proe%t-

( Ra#la$-( #r+ort-

( Cement Road-

( r#d.e-

( :am-

( Canal-

T,e-e are all *l re *#rement-

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Ad;erti+ing

Need !or "d#ertisin$

:e*e't h# e,o),ed ('to h(!h)3 co**od(t(2ed $roduct cte!or3. Due to

co*$et(t(,e $r(c('! +(th(' the ('du#tr3" there +# 'ot *uch d(5ere't(t(o'

*o'! the ,r(ou# br'd# o' o5er.

@eo$)e too d(d 'ot $3 *uch tte't(o' to th(# $roduct u')e## there +# 'eed.

He'ce $eo$)e +ho +ere curre't)3 *('! the(r hou#e# or +ere #oo' to e*br

o' #uch $ro1ect bec*e the tr!et *ret.

Becu#e o% the $roduct be('! co**od(t(2ed" there +# 'eed %or

d(5ere't(t(o' %or +h(ch there +# *de #o*e ch'!e# (' the %or* o% the

$roduct.

Shree :e*e't )td. +# 'ot d,ert(#('! (t# $roduct# $#t %e+ 3er# but )oo('! t

the co*$et(t(,e *ret 'd o$$ortu'(t(e# hed (t ('troduced 'e+ d c*$(!'

+h(ch +# tr!eted to d(5ere't(te (t# $roduct %ro* other ce*e't br'd#. It

('troduced ' d c*$(!' #ho+('! the 't( ru#t('! c$b()(t3 o% the Red O0(de

:e*e't o% the co*$'3. But #t()) the $re#e'ce o% the co*$'3 h# 'ot bee' #o

('te'#e # other br'd# h,e )(e A*bu1 'd Gr#(* etc.

S%OT Ana)y+i+ ,or S8ree Ceent:

Strengt8+

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@oor d,ert(#('! 'd br'd $ro*ot(o'

Opportunitie+

Re) e#tte boo* +()) )ed to ('cre#ed de*'d

I'ter't(o') e0$'#(o'

De*'d %ro* @(#t' #(de

Reduct(o' (' cu#to*# dut(e#

Go,er'*e'tM# thru#t o' ('%r#tructure 'd t0 ('ce't(,e# o' hou#('! )o'#

T8reat+

I'cre#ed co*$et(t(o' %ro* do*e#t(c # +e)) # ('ter't(o') $)3er#

R(#('! ('$ut 7o()8 $r(ce#

S)e# h(!h)3 de$e'de't o' *o'#oo'#

Gro+th o% cou'ter%e(t#

Creating Mu)tip)e !rand+ To &ncrea+e Market S8are

:o*$'3 +'ted to ('cre#e (tM# #hre (' the *ore re*u'ert(,e *ret#.

R1#th' 'd Hr3' re the *ret# +here Shree h,e h(!h re)(#t(o'. The3re)(2ed tht #('!)e br'd h# )(*(ted $ote't() %or %#ter ('cre#e (' *ret

#hre (' the#e *ret#. Th(# becu#e there re )(*(t# to the ,o)u*e tht

d(#tr(but(o' 'd ret() 'et+or cou)d h'd)e. Thu# there +# re/u(re*e't %or

('cre#('! d(#tr(but(o' 'et+or (' the#e *ret#. To ))e,(te th(#" the3 #tud(ed

the br'd #trte!3 o% %#t *o,('! :o'#u*er Good# :o*$'3. Th(# co*$'3

hd *u)t($)e br'd# %or #o$#. Ech br'd hd u'(/ue $roduct# d(5ere't(t(o'

$ro$ert3. A)) b'd# +ere co*$et('! +(th ech other. The *ret('! te*#"d(#tr(but(o' ch''e) 'd )o!(#t(c# +ere )) d(5ere't %or ech br'd. The3 %ou'd

the #*e *ode) cou)d be $$)(ed (' ce*e't bu#('e## # +e)). The3 re)(2ed tht

the3 c' )#o ch(e,e the(r ob1ect(,e b3 ('troduc('! 'other br'd (' the *ret.

The 'e+ br'd +ou)d h,e (t# o+' *ret('! #trte!3" d(#tr(but(o' 'et+or 'd

$e'etrt(o'. It re/u(red de$)o3*e't o% )*o#t t+(ce the /u'tu* o% re#ource# to

#u#t(' t+o br'd# (' the *ret#. A' )to!ether 'e+ *ret('! te*" dd(t(o')

d,ert(#('! co#t" 'other #et o% #tor!e 'd d(#tr(but(o' )o!(#t(c# )(e !odo+'#

'd o4ce#" thu# )) #uch co#t# +ere doub)('!. et" Shree :e*e't cho#e to !o

hed 'd )u'ched B'!ur :e*e't (' ?==. The re#u)t" *ret #hre ('

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R1#th' )*o#t doub)ed (' 1u#t o'e 3er. I' Hr3' (t ro#e b3 )*o#t >=

$erce't.

E'cour!ed b3 the #ucce## o% h,('! t+o br'd#" +e dec(ded to )u'ch th(rd

br'd-Tu5 :e*e'to. W(th three br'd# +e h,e %urther co'#o)(dted our $o#(t(o'(' the *ret. Tod3 Shree h,e three br'd# (' the #*e *ret6 Shree U)tr"

B'!ur :e*e't 'd Tu5 :e*e'to.

Ech o% the#e br'd# h# bee' bu()t o' u'(/ue $roduct $ro*(#e.

A# re#u)t o% *u)t($)e br'd #trte!3 :o*$'3M# *ret #hre# h,e #ho+'

$$rec(b)e !ro+th" # de*o'#trted be)o+6

E>ort+ ade to aintain t8ree -rand+

I'de$e'de't *ret('! te*

Se$rte d(#tr(but(o' 'd ret() 'et+or

Se$rte #tor!e 'd )o!(#t(c# #u$$ort#

H(!her d,ert(#e*e't co#t

Ac8ie;eent+ -y aintaining t8ree -rand+

H(!her De)er De'#(t3

H(!her *ret #hre

Better Re)(#t(o'

Lo+er )o!(#t(c# co#t

S#CCESS DR&6ERS AT SHREE

PEOPLE AS PRO"RESS DR&6ERS

Shree be)(e,e# tht +ht (# $re#e't (' the *('d# o% $eo$)e (# *ore ,)ub)e

th'

the ##et# o' the #ho$ oor. A)) the co*$'3M# ('(t(t(,e# re d(rected to

)e,er!e

the ,)ue o% th(# !ro+('! ##et.

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TEAM%OR5

Shree )e,er!e# e5ect(,e te* +or('! to !e'erte #u#t('b)e

(*$ro,e*e't.

LEADERS AT E6ER7 LE6EL

Shree be)(e,e# (' cret('! )eder# -'ot 1u#t t the or!'(2t(o') $e0 but t

e,er3

)e,e)" re#u)t('! (' #tro'! #e'#e o% e*ot(o') o+'er#h($.

C#LT#RE O4 &NNO6AT&ON

Shree be)(e,e# tht +ht (# !ood c' be *de better -cro## the or!'(2t(o'.

C#STOMER 4OC#S

Shree (# co**(tted to de)(,er #u$er(or /u)(t3 o% ce*e't t ttrct(,e)3

A5ordb)e $r(ce#.

SHAREHOLDER 6AL#E

Shree (# %ocu#ed o' the e'h'ce*e't o% ,)ue throu!h 'u*ber o% #trte!(c

'd bu#('e## ('(t(t(,e# tht !e'erte )r!er 'd better /u)(t3 o% er'('!#.

COMM#N&T7 AND EN6&RONMENT

ShreeM# co**u'(t3 co'cer' e0te'd# %ro* d(rect ##(#t'ce to #%e 'd

de$e'db)e o$ert(o'# %or (t# *e*ber# 'd the e',(ro'*e't.

LO%EST COST O4 PROD#CT&ON

It# co#t o% $roduct(o' (# rou'd R#.C= $er to'" *('! (t the )o+e#t co#t

ce*e't

$roducer (' I'd(.

ENER"7 E44&C&ENT PROD#CER

Shree :e*e't (# o'e o% the *o#t $o+er e4c(e't u'(t# (' the cou'tr3 +(th $o+er

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co'#u*$t(o' o% > u'(t# $er to'. The :o*$'3 #ource# ==J o% $o+er

re/u(re*e't

%ro* (t# c$t(,e $o+er $)'t#.

The co*$'3 h# e0(#t('! $o+er $)'t c$c(t3 o% ? ;W. The co*$'3 (#

('#t))('! dd(t(o') $o+er $)'t o% C ;W c$c(t3" +h(ch +ou)d #u$$)3 $o+erto

(t# 'e+ ce*e't u'(t#" thu# e'#ur('! #e)%-#u4c(e'c3.

ALTERNATE 4#EL &N PET CO5E

The :o*$'3M# c$t(,e $o+er $)'t # +e)) # ce*e't $)'t# ru'# o' )ter'te

%ue)" (.e." $et coe" the &r#t (' I'd( to do #o. U't() rece't)3" (t +# obt('('! $et

coe do*e#t(c))3 %ro* Re)('ce I'du#tr(e# Ltd." 9*'!r re&'er3. I*$orted

$et

coe 'd the %uture $)' to #ource (t %ro* @'($t re&'er3 o% IO:L +()) %urther

br('!do+' co#t# b3 rou'd R#.== $er to''e.

&NCREASED !LEND&N"

S:L (# co't('uou#)3 tr3('! to (*$ro,e the rt(o o% #)e o% b)e'ded ce*e't 7RO:8

to

>=6>= ,er3 #oo'. A)thou!h co#t o% $roduct(o' (# )o+er becu#e o% dd(t(o' o%

che$ 3-#h" (t co**'d# h(!her $r(ce# due to ru#t-retrd('! $ro$ert(e#.

CEMENT MAN#4ACT#R&N"

Ra9 Materia) Preparation

L(*e#to'e o% d(5er('! che*(c) co*$o#(t(o' (# %ree)3 ,()b)e (' the /urr(e#.

Th(# )(*e#to'e (# cre%u))3 b)e'ded be%ore be('! cru#hed. Red *('er) (# dded to

the )(*e#to'e t the cru#h('! #t!e to $ro,(de co'#(#te't che*(c) co*$o#(t(o' o%

42

Fi& / Li%estone E"traction

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the r+ *ter()#. O'ce the#e *ter()# h,e bee' cru#hed 'd #ub1ected to

o')('e che*(c) ')3#(# the3 re b)e'ded (' ho*o!e'(2ed #toc$()e. A bucet

+hee) rec)(*er (# u#ed to reco,er 'd %urther b)e'd th(# r+ *ter() *(0 be%ore

tr'#%er to the r+ *ter() !r('d('! *())#.

Ra9 Mi))Tr'#$ort be)t co',e3or tr'#%er# the b)e'ded r+ *ter()# to b)) *())# +here (t

(# !rou'd. The che*(c) ')3#(# (# !(' checed to e'#ure e0ce))e't /u)(t3

co'tro) o% the $roduct. The re#u)t('! !rou'd 'd dr(ed r+ *e) (# #e't to

ho*o!e'(2('! 'd #tor!e #()o %or %urther b)e'd('! be%ore be('! bur't (' the

()'#.

4ue)+

The het re/u(red to $roduce te*$erture# o% "C==X: t the *e (# #u$$)(ed b3

!rou'd 'd dr(ed $etro)eu* coe 'dFor %ue) o(). The @etcoe (# (*$orted ,( the

co*$'(e#P ('ter') +hr%" #tored 'd the' !rou'd (' ded(cted *())#. :re%u)

co'tro) o% the *())# e'#ure# o$t(*u* &'e'e## o% the @etcoe 'd e0ce))e'tco*bu#t(o' co'd(t(o'# +(th(' the ()'# #3#te*.

!urning

The r+ *e) (# %ed ('to the to$ o% $re-heter to+er e/u($$ed +(th %our c3c)o'e

#t!e#. A# (t %))#" the *e) (# heted u$ b3 the r(#('! hot !#e# 'd reche#

C==X:. At th(# te*$erture" the *e) deh3drte# 'd $rt())3 decrbo'(2e#. The

*e) the' e'ter# #)o$('! rotr3 ()'" +h(ch (# heted b3 "C==X: *e" +h(ch

co*$)ete# the bur'('! $roce## o% the *e). The *e) (# heted to te*$erture

o% t )e#t ">=X:. At th(# te*$erture the che*(c) ch'!e# re/u(red to

$roduce ce*e't c)('er re ch(e,ed. The dr3 $roce## ()' (# #horter th' the +et

$roce## ()' 'd (# the *o#t %ue)-e4c(e't *ethod o% ce*e't $roduct(o' ,()b)e.

Coo)er #nit

The c)('er d(#chr!('! %ro* the ()' (# coo)ed b3 (r to te*$erture o% =X:

bo,e *b(e't te*$erture 'd het (# reco,ered %or the $roce## to (*$ro,e %ue)

e4c(e'c3. So*e o% the (r %ro* the coo)er (# de-du#ted 'd #u$$)(ed to the co)

!r('d('! @)'t. The re*('('! (r (# u#ed # $reheted #eco'dr3 (r %or the *('

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3= >#ln

0/ 1iln

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co*bu#t(o' bur'er (' the ()'. :)('er (# ')32ed to e'#ure co'#(#te't $roduct

/u)(t3 # (t )e,e# the coo)er. ;et) co',e3or# tr'#$ort the c)('er to c)o#ed

#tor!e re#.

4i)ter+Ded(cted e)ectro#tt(c $rec($(ttor# dedu#t the (r 'd !#e# u#ed (' the :)('er

@roduct(o' L('e @roce##. I' th(# +3" .J o% the du#t (# co))ected be%ore ,e't('!

to the t*o#$here. A)) du#t co))ected (# retur'ed to the $roce##.

Con+tituent+

D(5ere't t3$e# o% ce*e't re $roduced b3 *(0('! 'd +e(!h('! $ro$ort(o'))3

the %o))o+('! co'#t(tue't#6

:)('er

G3$#u* L(*e#to'e dd(t(o'

B)#t

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4ig G: Ceent anu,acturing ,ro t8e =uarrying o, )ie+tone to t8e

-agging o, ceent.

%&t&re '&tlook !or the Sector

Deand to acce)erate ,a+ter 9it8 t8e +tart o, con+truction

+ea+on

The do*e#t(c ce*e't de*'d (' the cou'tr3 (# )(e)3 to cce)erte %#ter (' the

re*('('! $rt o% 3er ?== +(th the #trt o% co'#truct(o' #e#o'. Dur('! ?==

!ood #u**er (# e0$ected tht +()) be $o#(t(,e e',(ro'*e't %or co'#truct(o'

ct(,(t(e#. The co'#truct(o' ct(,(t(e# re e0$ected to #$eed u$ # 'd +he' d($

(' co)d +,e#. W(th r(#e (' co'#truct(o' ct(,(t(e# ,o)u*e# de*'d %or ce*e't (#

e0$ected to !ro+ =J dur('! ?==-=C.

Deand to +urpa++ +upp)y ti)) 471 a+ Ro-u+t deand

a8eadI

:e*e't de*'d !ro+th (# )(e)3 to #ur$## #u$$)3 t()) ?==C # *1or c$c(t3

dd(t(o' (# e0$ected to be !et #tre*)('ed %ter > *o'th# %ro* 'o+. Dur('!

?==-=C" c$c(t3 to the e0te't o% ??* to''e# +()) !et #tre*)('ed.

45

E?+e%ted In-talled Cement Ca+a%#t$

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De*'d %or ?==-=C (# )(e)3 to ('cre#e b3 ?->* to''e#" re!(#ter('! !ro+th

o% =-?J o' o b#(#. Go('! %urther" c$c(t3 to the tu'e o% * to''e# (#

)(e)3 to be #tre*)('ed dur('!

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!u+ine++ * Manageria) C8a))enge+

:e*e't *ret (# h(!h)3 co*$et(t(,e +(th *1or $)3er# h,('! d,'t!e o%

br'd e/u(t3" c$c(t3 'd er)3 *o,er#. The *1or $)3er# re B(''(" B(r)

7+(th $roduct# )(e B(r) Su$er 'd B(r) :het8" Gr#(* 7+(th $roduct# )(e

V(r* 'd B(r) @)u#8" Gu1rt A*bu1" 9K 7+(th $roduct# )(e 9K N(*bher8"

L0*(" ;'!)* 7+(th $roduct# )(e ;'!)* 'd B(r) Utt*8" A::" D:;

Shr(r*" L T 'd K*dhe'u. Ech o% the#e $)3er# h# the(r do*(''ce cro##

+ho)e R1#th' (' dd(t(o' to the(r re#$ect(,e re!(o') do*(''ce.

A'other (##ue (# tht the $roduct 7ce*e't8 c''ot be d(5ere't(ted c)er)3 o' the

b#(# o% /u)(t3 'd he'ce" co#t $)3# o'e o% the *o#t (*$ort't ro)e (' th(#

('du#tr3. I% the co*$'3 c' co'tro) co#t o% *'u%ctur('! d(#tr(but(o'" the'

'ot o')3 +ou)d $ro&tb()(t3 o% the co*$'3 ('cre#e" but th(# be'e&t +ou)d )#o

tr(c)e do+' to the cu#to*er#.

Lo!(#t(c# (# the *o#t (*$ort't co#t ##oc(ted +(th ce*e't ('du#tr3. Th(# (# the

#('!)e *o#t (*$ort't re#o' %or #tro'! do*(''ce o% )) ce*e't co*$'(e# (' ('

the re!(o'# rou'd the(r %ctor3. But (% th(# #3#te* c' be (*$ro,ed u$o'" 'd

co#t# c' be *'!ed" the' Shree :e*e't# Ltd. c' #tre'!the' the(r ho)d ('

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Re&ion 'ise Ca#acity ddition

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$re#e't #tte# o% d(#tr(but(o' # +e)) # )oo %or+rd to !('('! %ootho)d (' 'e+er

'd %rther re!(o'#.

Ri+k and Return o, Ceent Copanie+

"enera) Ri+k 4actor+

Econoic Condition+ 3 The $er%or*'ce o% ce*e't co*$'(e# *3

be #(!'(&c't)3 5ected b3 ch'!e# (' eco'o*(c co'd(t(o'#" 'd$rt(cu)r)3 co'd(t(o'# +h(ch 5ect the ce*e't ('du#tr3" (t# to$ co'#u*er#.

The#e ('du#tr(e# ('c)ude the re) e#tte #ector 'd co'#truct(o' co*$'(e#.

@ro&tb()(t3 o% the bu#('e## *3 )#o be 5ected b3 %ctor# #uch # *ret

co'd(t(o'#" ('tere#t rte#" 'd ('t(o'.

"eo3po)itica) 4actor+The co*$'(e# *3 be 5ected b3 the (*$cttht !eo-$o)(t(c) %ctor# h,e o' the +or)d eco'o*3 or o' &''c()

*ret# 'd (',e#t*e't# !e'er))3 or #$ec(&c))3. The#e ('c)ude thede*'d %or ce*e't %ro* :h('" 'd other e0$ort de#t('t(o'#.

"o;ernent po)icie+ and )egi+)ation @The co*$'(e# *3 be5ected b3 ch'!e# to !o,er'*e't $o)(c(e# 'd )e!(#)t(o'" ('c)ud('! tho#e

re)t('! to the re) e#tte 'd co'#truct(o' ('du#tr3 (' dd(t(o' to the

ce*e't #ector. T0t(o' 'd the re!u)t(o' o% trde $rct(ce# 'd

co*$et(t(o'. I' rece't t(*e# there h# bee' ' tte*$t b3 the !o,er'*e't

to co'tro) the $r(ce o% ce*e't b3 ch'!('! the t0 #tructure. Such tte*$t#cou)d cu#e $r(ce ('#tb()(t3 'd h(t o' *r!('#.

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Currency Ri+k(The rece't $$rec(t(o' o% the I'd(' ru$ee (# !o('! tobe *1or h('dr'ce to e0$ort to other cou'tr(e# e#$ec())3 ch(' # +e))

# other 't(o'#. :urre'c3 r(# re$re#e't# *1or (##ue %c('! e0$ort#

ho+e,er the r(# (# curre't)3 )e## due to the robu#t de*'d %or ce*e't ('

the do*e#t(c eco'o*3. Ho+e,er +(th dd(t(o' to $)'t c$c(t3 'd

('cre#e (' ,o)u*e o% $roduct(o'" #uch r(# +ou)d $ro,e to be *1or

ch))e'!e.

PRO'ECT PRO4&LE

"i;en the c$(t) bud!et('! o% &r*" (t h# to be dec(d('! the +3 ('

+h(ch the c$(t) $ro1ect# +()) be &''ced. E,er3 t(*e the &r* *e# '

(',e#t*e't dec(#(o'#" (t (# t the #*e t(*e *('! dec(#(o' )#o" E.!.

dec(#(o' to bu()d 'e+ $)'t or to bu3 'e+ *ch('e (*$)(e# #$ec(&c +3 o%

&''c('! tht $ro1ect. Shou)d &r* e*$)o3 e/u(t3 or debt or bothZ +ht re

(*$)(ct(o'# o% the debt E/u(t3 *(0 Z+ht (# ' $$ro$r(te *(0 o% debt 'd

e/u(t3 Z

COST O4 CAP&TAL

The *(' ob1ect(,e o% bu#('e## &r* (# to *0(*(2e the +e)th o% (t#

#hreho)der# (' the )o'!-ru'" the ;'!e*e't Shou)d o')3 (',e#t (' tho#e

$ro1ect# +h(ch !(,e retur' (' e0ce## o% co#t o% %u'd (',e#ted (' the $ro1ect o% the

bu#('e##. The d(4cu)t3 +()) r(#e (' deter*('t(o' o% co#t o% %u'd#" (% (# r(#ed

%ro* d(5ere't #ource# 'd d(5ere't /u'tu*. The ,r(ou# #ource# o% %u'd# to the

co*$'3 re (' the %or* o% e/u(t3 'd debt. The co#t o% c$(t) (# the rte o%

retur' the co*$'3 h# to $3 to ,r(ou# #u$$)(er# o% %u'd (' the co*$'3. There

re *(' t+o #ource# o% c$(t) %or co*$'3 #hreho)der 'd )e'der. The co#t

o% e/u(t3 'd co#t o% debt re the rte o% retur' tht 'eed to be o5ered to tho#e

t+o !rou$# o% #u$$)(er# o% c$(t) (' order to ttrct %u'd# %ro* the*. The co#t o%

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c$(t) (# ' e0$ected retur' tht the $ro,(der o% c$(t) $)'# to er' o' h(#

(',e#t*e't.

:o#t o% Debt (# co*$uted b3 t('! the rte o' 'o' de%u)t('!

bo'd +ho#e durt(o' *tche# the ter* #tructure o% the cor$orte debt th'

dd('! de%u)t $re*(u*. Th(# de%u)t $re*(u* +()) r(#e # the *ou't o% debt('cre#e 7 #('ce the r(# r(#e# # the *ou't o% debt r(#e#8.

The $r(*r3 %u'ct(o' o% e,er3 &''c() *'!er (# to rr'!e de/ute c$(t)

%or the &r*. A bu#('e## &r* c' r(#e c$(t) %ro* ,r(ou# #ource# #uch # e/u(t3

'd or $re%ere'ce #hre#" debe'ture#" ret(' er'('! etc. Th(# c$(t) (# (',e#ted

(' d(5ere't $ro1ect# o% the &r* %or !e'ert('! re,e'ue. O' the other h'd" (t (#

'ece##r3 %or the &r* to $3 *('(*u* retur' to ech #ource o% c$(t).

There%ore" ech $ro1ect *u#t er' #o *uch o% the ('co*e tht *('(*u* retur'c' be $(d to the#e #ource# or #u$$)(er o% c$(t). Wht #hou)d be th(# *('(*u*

retur'Z The co'ce$t u#ed to deter*('e th(# *('(*u* retur' (# c))ed :o#t o%

:$(t).

CONCEPT O4 COST O4 CAP&TAL

:o#t o% c$(t) (# the *e#ure*e't o% the #cr(&ce *de b3 (',e#tor# (' order to

(',e#t +(th ,(e+ to !et %(r retur' (' %uture o' h(# (',e#t*e't# # re+rd %or

the $o#t$o'e*e't o% h(# $re#e't 'eed#. O' the other h'd %or* the $o('t o% ,(e+

o% the &r* u#('! the c$(t)" c#t o% c$(t) (# the $r(ce $(d to the (',e#tor %or the

u#e o% c$(t) $ro,(ded b3 h(*. Thu#" co#t o% c$(t) (# re+rd %or the u#e o%

c$(t). Author Lut2 h# c))ed (t BORROWING AND LANDING RATES. The

borro+('! rte# *e'# the rte o% ('tere#t +h(ch *u#t be $(d to obt('ed 'd

u#e the c$(t). S(*()r)3" )'d('! rte (# the rte t +h(ch the &r* d(#cou't# (t#

$ro&t#. It *3 )#o the o$$ortu'(t3 co#t o% the %u'd# to the &r* (.e. +ht the &r*

+ou)d er' b3 (',e#t('! the#e %u'd# e)#e+here. I' $rct(ce the borro+('! rte#

u#ed ('d(cte the co#t o% c$(t) (' $re%ere'ce to )'d('! rte#.

Tech'(c))3 'd O$ert(o'))3" the co#t o% c$(t) de&'e # the *('(*u*

rte o% retur' &r* *u#t er' o' (t# (',e#t*e't (' order to #t(#%3 (',e#tor# 'd

to *('t(' (t# *ret ,)ue. I.e. (t (# the (',e#tor# re/u(red rte o% retur'. :o#t o%

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c$(t) )#o re%er# to the d(#cou't rte +h(ch (# u#ed +h()e deter*('('! the

$re#e't ,)ue o% e#t(*ted %uture c#h o+#. I' the other +ord o% 9oh' 9.

H*$to'"

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The co#t o% c$(t) (# ,er3 (*$ort't co'ce$t (' the &''c() dec(#(o' *('!. The

$ro!re##(,e *'!e*e't )+3# )(e# to co'#(der the co#t o% c$(t) +h()e t('!

&''c() dec(#(o'# # (tM# ,er3 re)e,'t (' the %o))o+('! #$here#...

. De#(!'('! the c$(t) #tructure6 the co#t o% c$(t) (# the #(!'(&c't %ctor ('

de#(!'('! b)'ced ' o$t(*) c$(t) #tructure o% &r*. Wh()e de#(!'('!(t" the *'!e*e't h# to co'#(der the ob1ect(,e o% *0(*(2('! the ,)ue

o% the &r* 'd *('(*(#('! co#t o% c$(t. I co*$r('! the ,r(ou# #$ec(&c

co#t# o% d(5ere't #ource# o% c$(t)" the &''c() *'!er c' #e)ect the

be#t 'd the *o#t eco'o*(c) #ource o% &''ce 'd c' de#(!'ed #ou'd

'd b)'ced c$(t) #tructure.

?. :$(t) bud!et('! dec(#(o'#6 the co#t o% c$(t) #ource# # ,er3 u#e%u) too)

(' the $roce## o% *('! c$(t) bud!et('! dec(#(o'#. Acce$t'ce orre1ect(o' o% '3 (',e#t*e't $ro$o#) de$e'd# u$o' the co#t o% c$(t). A

$ro$o#) #h)) 'ot be cce$ted t()) (t# rte o% retur' (# !reter the' the co#t

o% c$(t). I' ,r(ou# *ethod# o% d(#cou'ted c#h o+# o% c$(t) bud!et('!"

co#t o% c$(t) *e#ured the &''c() $er%or*'ce 'd deter*('e#

cce$tb()(t3 o% )) (',e#t*e't $ro$o#)# b3 d(#cou't('! the c#h o+#.

. :o*$rt(,e #tud3 o% #ource# o% &''c('!6 there re ,r(ou# #ource# o%

&''c('! $ro1ect. Out o% the#e" +h(ch #ource #hou)d be u#ed t

$rt(cu)r $o('t o% t(*e (# to be dec(ded b3 co*$r('! co#t o% d(5ere't

#ource# o% &''c('!. The #ource +h(ch ber# the *('(*u* co#t o% c$(t)

+ou)d be #e)ected. A)thou!h co#t o% c$(t) (# ' (*$ort't %ctor (' #uch

dec(#(o'#" but e/u))3 (*$ort't re the co'#(dert(o'# o% ret('('! co'tro)

'd o% ,o(d('! r(##.

. E,)ut(o'# o% &''c() $er%or*'ce o% to$ *'!e*e't6 co#t o% c$(t)

c' be u#ed to e,)ute the &''c() $er%or*'ce o% the to$ e0ecut(,e#.

Such # e,)ut(o'# c' be do'e b3 co*$r('! ctu) $ro&tb()(t3 o% the

$ro1ect u'derte' +(th the ctu) co#t o% c$(t) o% %u'd# r(#e o &''ce

the $ro1ect. I% the ctu) $ro&tb()(t3 o% the $ro1ect (# *ore the' the ctu)

co#t o% c$(t)" the $er%or*'ce c' be e,)uted # #t(#%ctor3.

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>. K'o+)ed!e o% &r*# e0$ected ('co*e 'd ('here't r(##6 (',e#tor# c' 'o+

the &r*# e0$ected ('co*e 'd r(## ('here't there (' b3 co#t o% c$(t). I%

&r*# co#t o% c$(t) (# h(!h" (t *e'# the &r*# $re#e't rte o% er'('!# (#

)e##" r(# (# *ore 'd c$(t) #tructure (# (*b)'ced" (' #uch #(tut(o'#"

(',e#tor# e0$ect h(!her rte o% retur'.

.

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Wh()e co*$ut('! the co#t o% c$(t)" the %o))o+('! ##u*$t(o'# re *de6

The co#t c' be e(ther e0$)(c(t or (*$)(c(t.

The &''c() 'd bu#('e## r(## re 'ot 5ected b3 (',e#t('! ('

'e+ (',e#t*e't $ro$o#)#.

The &r*M# c$(t) #tructure re*('# u'ch'!ed.

:o#t o% ech #ource o% c$(t) (# deter*('ed o' ' %ter t0

b#(#.

:o#t# o% $re,(ou#)3 obt('ed c$(t) re 'ot re)e,'t %or

co*$ut('! the co#t o% c$(t) to be r(#ed %ro* #$ec(&c #ource.

Coputation o, +peciBc co+t+

A &r* c' r(#e %u'd# %ro* d(5ere't #ource# #uch # )o'" e/u(t3 #hre#"

$re%ere'ce #hre#" ret('ed er'('!# etc. A)) the#e #ource# re c))ed co*$o'e't#

o% c$(t). The co#t o% c$(t) o% the#e d(5ere't #ource# (# c))ed #$ec(&c co#t o%

c$(t). :o*$utt(o' o% #$ec(&c co#t o% c$(t) he)$# (' deter*('('! the o,er))

co#t o% c$(t) %or the &r* 'd (' e,)ut('! the dec(#(o' to r(#e %u'd# %ro*

$rt(cu)r #ource. The co*$utt(o' $rocedure o% #$ec(&c co#t# (# e0$)('ed (' the

$!e# tht %o))o+

COST O4 DE!T CAP&TAL

:o#t o% Debt (# the e5ect(,e rte tht co*$'3 $3# o' (t# curre't debt.

Th(# c' be *e#ured (' e(ther be%ore- or %ter-t0 retur'# ho+e,er" becu#e

('tere#t e0$e'#e (# deduct(b)e" the %ter-t0 co#t (# #ee' *o#t o%te'. Th(# (# o'e

$rt o% the co*$'3P# c$(t) #tructure" +h(ch )#o ('c)ude# the co#t o% e/u(t3.

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;uch theoret(c) +or chrcter(2e# the cho(ce bet+ee' debt 'd e/u(t3" ('

trde-o5 co'te0t6 )c# o% R#. == ech

t $r" the' (t *u#t be er' t )e#t R#.====7?J o% R#. > )c#8 $er 3er o' th(#

(',e#t*e't to *('t(' the ('co*e ,()b)e to the #hreho)der# u'ch'!ed.

I% the co*$'3 er'+# )e## th' th(# ('tere#t rte 7?J8 th' the ('co*e

,()b)e to the #hreho)der# +()) be redu#ed 'd the *ret ,)ue o% the #hre

+()) !o do+'. There%ore" the co#t o% debt c$(t) (# the co'trctu) ('tere#t rte

d1u#ted %urther %or the t0 )(b()(t3 o% the &r*. But" to 'o+ the re) co#t o% debt"

the re)t(o' o% the ('tere#t rte (# to be e#tb)(#hed +(th the ctu) *ou't

re)(#ed or 'et $roceed# %ro* the (##ue o% debe'ture#.

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To !et the %ter-t0 rte" 3ou #(*$)3 *u)t($)3 the be%ore-t0 rte b3 o'e *('u# the

*r!(') t0 rte.

:o#t o% Debt [ 7be%ore-t0 rte 0 7-*r!(') t088

The be%ore t0 rte o% ('tere#t c' be c)cu)ted # be)o+6

[ I'tere#t E0$e'#e o% the co*$'3 ==

---------------------------------------- Tot) Debt

Net @roceed#6

. At $r [ @r ,)ue

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. The co*$utt(o' o% co#t o% eu(t3 #hre c$(t) (# re)t(,e)3 d(4cu)t

becu#e 'e(ther the rte o% d(,(de'd (# $redeter*('d 'or the $3*e't o%

d(,(de'd (# )e!))3 b('d('!" there%ore" #o*e &''c() e0$ert# ho)d the o$('(o'

the $.# c$(t) doe# 'ot crr3 '3 co#t but th(# (# 'ot true. Whe' dd(t(o')e/u(t3 #hre# re (##ued" the 'e+ e/u(t3 #hre ho)der# !et $ro$r'te #hre

(' %uture d(,(de'd 'd u'd(#tr(buted $ro&t# o% the co*$'3. I% reduce# the

er'('! $er #hre# o% e0c(#t('! #hre ho)der# re#u)t('! (' %)) (' *rer

$r(ce o% #hre#. There%ore" t the t(*e o% (##ue o% 'e+ e/u(t3 #hre#" (t (# the

dut3 o% the *'!e*e't to #ee tht the co*$'3 *u#t er' t)e#t #o *uch

('co*e tht the *ret $r(ce o% (t# e0(#t('! #hre re*('# u'ch'!ed. Th(#

e0$ected *('(*u* rte o% retur' (# the c#t o% e/u(t3 #hre c$(t). Thu#"co#t o% e/u(t3 #hre c$(t) *3 be de&'e # the *('(*u* rte o% retur' tht

&r* *u#t er' o' the e/u(t3 &''ced $ort(o' o% (',e#t*e't- $ro1ect ('

order to )e,e u'ch'!ed the *ret $r(ce o% (t# #hre#. The co#t o% e/u(t3

c' be co*$uted b3 '3 o% the %o))o+('! *ethod6

. D(,(de'd 3(e)d *ethod6

Ke [ D@S_*@`==

Ke[ co#t o% e/u(t3 c$(t)

D$#[ curre't c#h d(,(de'd $er #hre

;$[curre't *ret $r(ce $er #hre

?. Er'('! 3(e)d *ethod6

Ke[ E@S_*$`==

E$#[ er'('! $er #hre

. D(,(de'! 3(e)d $)u# !ro+th (' d(,(de'd *ethod6

Wh()e co*$ut('! co#t o% c$(t) u'der d(,(de'd 3(e)d7d_$ rt(o8*ethod" (t hd

bee' #u*e'd tht $re#e't rte o% d(,(de'd +()) re*() the #*e (' %uture )#o.

But" (% the *'!e*e't e#t(*te# tht co*$'(e# $re#t'et d(,(de'd +())

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('cre#ed co't('u(#)3 %or the 3er to co*e" the' d1u#t*e't %or th(# ('cre#e (#

e##e't() to co*$ute the co#t o% c$(t).

The !ro+th rte (' d(,(de'd (# ##u*ed to be e/u) to the !ro+th rte (' er'('!

$er #hre.

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Ke[ D@S_N@`==

Or

Ke[ E@S_N@`== Or

Ke[D@S_N@`==\G

COST O4 RETA&N EARN&N"S OR &NTERNAL EF#&T7:

Ge'er))3" co*$'3M# do 'ot d(#tr(bute the e't(re $ro&t# b3 +3 o% d(,(de'd

*o'! the(r #hre ho)der#. A $rt o% #uch $ro&t (# ret('ed %or %uture e0$'t(o'

'd de,e)o$*e't. Thu# 3er b3 3er" co*$'(e# crete #u4c('t %u'd %or the

&''c('! thru!h ('ter') #ource#. But " 'ether the co*$'3 $3# '3 co#t 'or

('cur '3 e0$e'd(ture %or #uch %u'd#. There%ore" (t (# ##u*ed to co#t %ree c$(t)

tht (# 'ot true. Thou!h rt(' er'('!# )(e ret('ed er'('!# )(e e/u(t3 %u'd#

h,e 'o e0$)(c(t co#t but do h,e o$$ortu'(t3 co#t. The o$$ortu'(t3 co#t (o%

ret('ed er'('!# (# the ('co*e %or!o'e b3 the #hre ho)der#. It (# e/u) to the

('co*e +ht #hre ho)der# cu)d h,e er' other+(#e b3 (',e#t('! the #*e ('

' )ter't(,e (',e#t*e't" I% the co*$'3 +ou)d h,e d(#tr(buted the er'('!# b3

+3 o% d(,(de'd ('#ted o% ret('('! (' the bu#(e'e##. There%ore " e,er3 #hre

ho)der# e0$ect# %ro* the co*$'3 tht *uch o% ('co*e o' rt('ed er'('!# %or

+h(ch he (# de$r(,ed o% the ('co*e r(#('! o (t# )ter't(,e (',e#t*e't. Thu#"

('co*e %or!o'e or #cr(ed (# the co#t o% ret(' er'('!# +h(ch the #hre ho)der#

e0$ect# %ro* the co*$'3.

%E&"HTED A6ERA"E COST O4 CAP&TAL

O'ce the #$ec(&c co#t o% c$(t) o% the )o'!-ter* #ource# (.e. the debt" the

$re%ere'ce #hre c$(t)" the e/u(t3 #hre c$(t) 'd the ret('ed er'('!# h,e

bee' #cert('ed" the 'e0t #te$ (# to c)cu)te the o,er)) co#t o% c$(t) o% the

&r*. The c$(t) r(#ed %ro* ,r(ou# #ource# (# (',e#ted (' d(5ere't $ro1ect#. The

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$ro&tb()(t3 o% the#e $ro1ect# (# e,)uted b3 co*$r('! the e0$ected rte o%

retur' +(th o,er)) co#t o% $(t) o% the &r*. The o,er)) co#t o% c$(t) (# the

+e(!hted ,er!e o% the co#t# o% the ,r(ou# #ource# o% the %u'd#" +e(!ht# be('!

the $ro$ort(o' o% ech #ource# o% %u'd# (' the tot) c$(t) #tructure. Thu#"

9eig8ted a;erage a+ t8e nae ip)ie+$ i+ an a;erage o, t8e co+t o,+peciBc +ource+ o, capita) ep)oyed in t8e -u+ine++ proper)y 9eig8ted

-y t8e proportion t8ey 8e)d in Br+ capita) +tructure. It (# )#o ter*ed #

:o*$o#(te :o#t o% :$(t)M or O,er)) :o#t o% :$(t)M or A,er!e :o#t o%

:$(t)M. We(!hted ,er!e co#t o% c$(t) # u#ed ('

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The co#t o% ech #$ec(&c #ource o% &''ce (# c)cu)ted ccord('! to

the $re,()('! *ret $r(ce.

But" the ##(!'*e't o% the +e(!ht o' the b#(c o% *ret ,)ue (#

o$ert(o'))3 ('co',e'(e't # the *ret ,)ue o% #ecur(t(e# *3 %re/ue't)3

uctute. ;oreo,er" #o*et(*e#" 'o *ret ,)ue (# ,()b)e %or the$rt(cu)r t3$e o% #ecur(t3" #$ec())3 (' c#e o% ret('ed er'('!# c'

('d(rect)3 be e#t(*ted b3 "itan+ *ethod. Accord('! to h(*" ret('ed

er'('!# re treted # e/u(t3 c$(t) %or c)cu)t('! co#t o% #$ec(&c #ource#

o% %u'd#. The *ret ,)ue o% e/u(t3 #hre *3 be co'#(dered # the

co*b('ed *ret ,)ue o% both e/u(t3 #hre# 'd ret('ed er'('!# or

('d(,(du) *ret ,)ue 7e/u(t3 #hre# 'd ret('ed er'('!#8 *3 )#o be

deter*('ed b3 ))oct('! ech o% $erce't!e #hre o% the tot) *ret,)ue to the(r re#$ect(,e $erce't!e #hre o% the tot) ,)ue#.

4or eap)e:3 the c$(t) #tructure o% co*$'3 co'#(#t# o% ="===

e/u(t3 #hre# o% R#. = ech d ret('ed er'('! o% R#. "=="===. (% the

*ret $r(ce o% co*$'3M# e/u(t3 #hre (# R#. C" th' tot) *ret ,)ue o%

e/u(t3 #hre# 'd ret('ed er'('!# +ou)d be R#. "?="=== 7="===` C8

+h(ch c' be ))octed bet+ee' e/u(t3 c$(t) 'd ret('ed er'('!# #%o))o+#-

;ret V)ue o% E/u(t3 :$(t) [ "?="===`"=="===F>"=="===

[R#. >""===.

;ret V)ue o% Ret('ed Er'('!#[ "?="===`"=="===F>"=="===

[R#. ""===.

2 Coputation o, SpeciBc Co+t o, Eac8 Source:

A%ter ##(!'('! the +e(!ht #$ec(&c co#t# o% ech #ource o% c$(t)" #e0$)('ed er)(er" re to be c)cu)ted. I' &''c() dec(#(o'#" )) co#t# re

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%ter t0M co#t#. There%ore" (% '3 #ource h# be%ore t0M co#t" (t h# to be

co',erted (' to %ter t0M co#t.

3 Coputation o, %eig8ted Co+t o, Capita) :A%ter #cert('('! the +e(!ht# 'd co#t o% ech #ource o% c$(t)" the

+e(!hted ,er!e co#t (# c)cu)ted b3 *u)t($)3('! the co#t o% ech #ource

b3 (t# $$ro$r(te +e(!ht# 'd +e(!hted co#t o% )) the #ource# (# dded.

Th(# tot) o% +e(!hted co#t# (# the +e(!hted ,er!e co#t o% c$(t). The

%o))o+('! %or*u) *3 be u#ed %or th(# $ur$o#e 6

K+ [ aWFaW

Here K+ [ We(!hted ,er!e co#t o% c$(t) [ A%ter t0 co#t o% d(5ere't #ource# o% c$(t)

W [ We(!ht# ##(!'ed to $rt(cu)r #ource o% c$(t)

Eap)e :

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Er'('!@.S. :$(t) ">="=== .= . .=>Debe'ture# "=="=== .= .= .=?=Tota) 21$11$11

1

2.11 .21

%eig8ted A;erage Co+t o, Capita)

%ACC(

.211 or

21.

CALC#LAT&ON O4 COST O4 CAP&TAL O4 SHREE CEMENT LTD:

Co+t o, De-t Capita):

4or t8e year 011G31:

Tota) De-t Capita) K Ter )oan ,ro !ank+ De-t+

K 220G/.2 11 K 22//G/.2 )ac+

Tota) &ntere+t Paid K Q/.G0 )ac+

Ta Rate K /1

I'tere#t E0$e'#e o% the co*$'3

Kd 7be%ore t08 [ -------------------------------------------- ==

Tot) Debt

Q/.G0

5d -e,ore ta( [ ---------------------- == [

.1

22//G/.2

Kd 7%ter t08 K I'tere#t Rte Be%ore T0 T0 Rte 7 =J.8

5d a,ter ta( K .1 3 /1 K .Q

4or t8e year 01131G

Tota) De-t Capita) K Ter )oan ,ro !ank+ De-t+

K /0G.10211 K 0G.10)ac+

Tota) &ntere+t Paid K G/.10 )ac+

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Ta Rate K /1

G/.10

5d -e,ore ta( [ ---------------------- 211 [

G.G

0G.10

5d a,ter ta( K G.G 3 /1 K .0

4or t8e year 01131

Tota) De-t Capita) K Ter )oan ,ro !ank+ De-t+

K 02G.//0111K /12G.//)ac+ Tota) &ntere+t Paid K 02/.02)ac+

Ta Rate K /1

02/.02

5d -e,ore ta( [ ------------------- == [ G

/12G.//

5d a,ter ta( K G 3 /1 K .Q1

COMPARAT&6E CALC#LAT&ON O4 5d 4OR THREE 7EAR

Particu)ar 011G31 01131G 01131

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Tot) Debt# 7Ter* )o' %ro*

B'\Debt#8

?>.

C\C==

[.

C

C?.=?

\==

[CC?.=

?

?C.

\?===

[=.

Tot) I'tere#t $(d .? >.C ?.?

I'tere#t Rte 7Be%ore T08 C.>=J .>J J

I'tere#t Rte 7A%ter T08[

I'tere#t Rte Be%ore T0 T0

Rte =J.

>.>J >.?J .=J

COST O4 EF#&T7 CAP&TAL:

EF#&T7 SHARE CAP&TAL

Particu)ar 011G31 01131G 01131No. o% Shre# 7I'

)c#8

C. C. C.

D@S G(,e' C >;ret @r(ce 7t the

e'd o% ;rch8

=.= ?.C> C.>=

Er'('! $er e/u(t3

#hre o% r#. =7(' R#.8

. >=.C NA

@ro$o#ed &')

d(,(de'd o' e/u(t3

#hre 7(' )c#8

?C.C Not !(,e' NA

;ret :$(t)(#t(o'

7(' Lc#8

=.=

?. ?=.

1 Di;idend yie)d p)u+ gro9t8 in di;idend et8od:3

5e K DPSP211 "

D$# [ :urre't c#h d(,(de'd $er #hre [ C R#.

;$ [ :urre't *ret $r(ce $er #hre [ =.= R#.

G [ Gro+th rte [ =J

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5e [ -------------------- 211 21 K

21.G

21GQ.1

0. Earning yie)d et8od:35eK EPSp211

E$# [ er'('! $er #hre [ . R#.

;$ [ ;ret $r(#e [ =.= R#.

G.G

5e [ -------------------- 211 K

.Q0

21GQ.1/. Di;idend per +8are et8od:3

5e K Propo+ed Bna) di;idend on E=uity S8are No. o,

E=uity S8are

@ro$o#ed &') d(,(de'd o' E/u(t3 Shre [ ?C.C Lc#

No. o% E/u(t3 Shre [ C. Lc#

0G.Q

5e K 33333333333333333333

K

/./G

COST O4 EF#&T7 SHARE CAP&TAL 5E(

Particu)ar 011G3

1

D(,(de'd @er #hre *ethod CEr'('! e()d ;ethod .?D(,(de'd 3(e)d $)u# !ro+th

*ethod

=.

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MER&TS O4 %E&"HTED A6ERA"E COST O4 CAP&TAL

The WA:: (# +(de)3 u#ed $$roch (' deter*('('! the re/u(red retur' o' &r*M#

(',e#t*e't#. It o5er# 'u*ber o% d,'t!e# ('c)ud('! the %o))o+('!#-

2. Straig8t ,or9ard and )ogica)6 It (# the #tr(!ht%or+rd 'd )o!(c)

$$roch to d(4cu)t $rob)e*. It de$(ct# the o,er)) co#t o% c$(t) # the

#o*e o% the co#t o% the ('d(,(du) co*$o'e't# o% the c$(t) #tructure. It

e*$)o3# d(rect 'd re#o'b)e *ethodo)o!3 'd (# e#()3 c)cu)ted 'd

u'der#tood.

0. Re+pon+i;ene++ to C8anging Condition:S('ce" (t (# b#ed u$o'

('d(,(du) debt 'd e/u(t3 co*$o'e't# the +e(!hted ,er!e co#t o%

c$(t) reect# ech e)e*e't (' the c$(t) #tructure. S*)) ch'!e# (' the

c$(t) #tructure o% the &r* +()) be 'oted b3 #*)) ch'!e# (' o,er)) co#t o%

c$(t) o% the &r*.

/. Accurate 98en ProBt+ are Nora):Dur('! the $er(od o% 'or*)

$ro&t#" the +e(!hted ,er!e co#t o% c$(t) (# *ore ccurte # cut-o5

rte (' #e)ect('! the c$(t) bud!et('! $ro$o#)#. It (# becu#e the +e(!hted

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,er!e co#t reco!'(#e# the re)t(,e)3 )o+ debt co#t 'd the 'eed to

co't('ue to ch(e,e the h(!her retur' o' the e/u(t3 &''ced ##et#.

. &dea) Creation ,or Capita) Ependiture Propo+a)+: W(th the

he)$ o% +e(!hted ,er!e co#t o% c$(t)" the &''ce *'!er dec(de# thecut-o5 rte %or t('! dec(#(o'# re)t('! to c$(t) e0$e'd(ture $ro$o#)#.

Th(# cut-o5 rte deter*('e# the *('(*u* )(*(t %or cce$t('! ' (',e#t*e't

$ro$o#). I% ' (',e#t*e't $ro$o#) (# cce$ted be)o+ th(# )(*(t" the &r*

('cur )o##. There%ore" th(# cut-o5 rte (# )+3# dec(ded bo,e the

+e(!hted ,er!e co#t o% c$(t).

L&M&TAT&ON O4 %E&"HTED A6ERA"E COST O4 CAP&TAL:

The +e(!hted A,er!e co#t $$roch )#o h# #o*e +e'e##e#" (*$ort't

*o'! the* re # %o))o+#6

. #n+uita-)e in ca+e o, Ece++i;e Lo93co+t De-t+:Short ter*

)o' c' re$re#e't (*$ort't #ource# o% %u'd %or &r* e0$er(e'c('! &''c()

d(4cu)t(e#. Whe' &r* re)(e# o' ^ero co#t 7(' the %or* o% $3b)e#8 or )o+

co#t #hort ter* debt" the ('c)u#(o' o% #uch debt# (' the c)cu)t(o' o% co#t o%

c$(t) +()) re#u)t (' )o+ WA::. I% the &r* cce$t# )o+-retur' $ro1ect# o'

the b#(c o% th(# )o+ WA::" the &r* +()) be (' h(!h &''c('! r(#.

?. #n+uita-)e in Ca+e o, Lo9 ProBt+ : I% &r* (# e0$er(e'c('!

$er(od o% )o+ $ro&t#" 'ot er'('! $ro&t # co*$red to other &r*# (' the

('du#tr3" WA:: +()) be ('ccurte 'd o% )(*(ted ,)ue.

. Dicu)ty in A++igning %eig8t+: The *(' d(4cu)t3 (' c)cu)t('!

the WA:: (# to ##(!' +e(!ht to d(5ere't co*$o'e't# o% c$(t) #tructure.

Nor*))3" there re t+o t3$e o% +e(!ht#- 7(8 boo ,)ue +e(!ht# 'd 7((8

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*ret ,)ue +e(!ht. The#e t+o t3$e o% +e(!ht# !(,e d(5ere't re#u)t#.

He'ce" the $rob)e* (# +h(ch t3$e o% +e(!ht #hou)d be ##(!'ed. Thou!h"

*ret ,)ue (# *ore $$ro$r(te th' boo ,)ue" but the *ret ,)ue o%

ech co*$o'e't o% c$(t) o% co*$'3 (# 'ot red()3 ,()b)e. Whe' the

#ecur(t(e# o% the co*$'3 re u')(#ted" the $rob)e* beco*e# *ore('tr(cte.

. Se)ection o, Capita) Structure : The #e)ect(o' o% c$(t) #tructure

to be u#ed %or deter*('('! the WA:: (# )#o 'ot e#3 1ob. Three t3$e# o%

c$(t) #tructure re there (.e. curre't c$(t) #tructure" *r!(') c$(t)

#tructure 'd o$t(*) c$(t) #tructure. Wh(ch o% the#e c$(t) #tructure be

#e)ected. Ge'er))3" curre't c$(t) #tructure (# re!rded # the o$t(*)#tructure" but (t (# 'ot )+3# correct.

CONCL#S&ON

The#e #(0 +ee# t S:L h,e $ro,ed to be !ret)3 ('ue't() (' *3 cde*(c

)(%e. I' %ct (t :' be #tted # tur' rou'd %or *e" tur'('! *e %ro* cde*(c

*3#e)% to $ro%e##(o') *3#e)%. E,er3 +ord" theor3" (' Bu#('e## ;'!e*e't

:our#e *ter() tur'ed out to be true %or *e . The e0$er(e'ce $())ed u$ #)o+)3

!(,e *e tot) ('#(!ht ('to the $rct(c) #$ect o% bu#('e##. Th(# e0$o#ure h,e

*de *e co'&de't (' *3 &e)d o% ('tere#t (.e. &''ce e,e' +(th ('$ut# o%

#trte!(c dec(#(o'#.

A%ter co*$)et('! *3 #u**er tr('('! (' S:L 'o+ I * ,er3 *uch co'&de't (' *3

&e)d tht ho+ dec(#(o'# re to be *de t to$ *'!e*e't )e,e) ho+ #te$# re

be('! te' to !(' co*$et(t(,e d,'t!e. Th(# +# 'ot o')3 1u#t #u**er

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tr('('! tht I crr(ed out . I crr(ed out +(th (t 'e+ d(*e'#(o' to *3 $er#o')(t3.

It +# !ret e0$er(e'ce %or *e to !et ('du#tr() e0$o#ure" +h(ch +()) be he)$%u)

%or *e to e'ter (' cor$orte +or)d. E,er3 det()# o% ccou't('! &''ce $roce##

o% co*$'3 h,e bee' h(!h)(!hted" )(!ht h# bee' thro+' o' e,er3 #$ect o%

&''ce d(,(#(o' 'd +ht re the o$$ortu'(t(e# o% the co*$'3 (' 'er %uture.

A//#$%I!S

3#S"I*$$AI'# 4

!ement Mar5et Surve (%ealers6 'etailers)

%ealer 6 'etailer $ame - .77777777777777777778888Brand - .77777777777777777778888

Address - .77777777777777777778888/hone $o8 - .77777777777777777777

1# hat do &ou thin' about the brand i(age o) )ollo*ing brands+

Brand $ Re(ar' "ood ,erage Belo* ,erage

,(bu-a

Birla Cheta'

.hree /ltra

/ltratech

Other

0# hat do &ou thin' about co(pan&s serice+

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Brand $ Re(ar' "ood ,erage Belo* ,erage

,(bu-a

Birla Cheta'

.hree /ltra

/ltratech

Other

2# hich adertise(ent strateg& do &ou suggest to the co(pan& to be adopted3a ,ds# on 5#6# 3b ,ds# in e*s Paper 3c all Painting 3d Hoardings 3e Other

4# Ho* o)ten (ar'eting o))icer isit &our shop+

Brand 92 4 or :ore

,(bu-a

Birla Cheta'

.hree /ltra

/ltratech

Other

;# hat do &ou thin' about co(pan&s current (ar'et policies+Brand $ Re(ar' "ood ,erage Belo* ,erage

,(bu-a

Birla Cheta'

.hree /ltra

/ltratech

Other

!# ,re &ou satis)ied *ith sales pro(otion e))orts o) co(pan&+

Brand $ Re(ar'

8/12/2019 Lo Kendra

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Other

%ate- .7777777 Signature- .77777777778

3#S"I*$$AI'# 9

!onsumer /erception about !ement

$ame - .77777777777777777777Address - .77777777777777777777

777777777777777777777

*ccupation - .77777777777777777777/hone $o8 - .77777777777777777777

1# hich brand o) ce(ent &ou pre)er to use+

3a ,(bu-a 3b Birla Cheta' 3c .hree /ltra 3d /ltratech 3e Other

0# h& do &ou pre)er this brand+

3a Brand I(age 3b Price 3c =ualit& 3d ,ailabilit& 3e Other

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2# hich grade o) ce(ent &ou pre)er the (ost+

3a ;2 3b 42 3c R>D9O?ID> 3d Other

4# ,re &ou satis)ied *ith the result+

3a

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Maga:ines Ce(ent :anu)acturing ,ssociation 3C:, *ee'l& and (onthl&

reportsA ,nnual Reports o) .hree Ce(ent @i(ited 30798A 089A other reports# $ewspapers 5i(es o) IndiaA >cono(ic 5i(esA :intA Financial >press

2#BSI"#S '#00#'#%

***#shreece(entltd#co(

#nd#a#n)ol#ne%om

The Eco'o*(c T(*e#

The T(*e# o% I'd(

httpE$$***#(ar'etresearch#co*

httpE$$tra'#in$5ags$Business$cd(a$

***#dotindia#org

http://www.shreecementltd.com/http://trak.in/Tags/Business/cdma/http://trak.in/Tags/Business/cdma/http://www.shreecementltd.com/