Managing Director & CEO’s message

Delivering with a strong
sense of discipline

Dear Stakeholders,

The world faced an unprecedented once-in-a-lifetime catastrophe in the form of the COVID-19 pandemic.

Our priority during the difficult months of the pandemic was to ensure business continuity. We realigned our focus and channelised our energies around three core areas – health, cost and cash. I am deeply thankful to the entire team for making it possible with their passion, proactivity and customer‑centric philosophy.

We ensured the health and well-being of our people, their families, and our stakeholders through emergency preparedness, awareness drives, training and communication. We also instilled a strong sense of discipline among our employees that also helped us restart our operations faster than our peers.

While the flow of revenues remained muted, we focused on stringent cost management initiatives, strengthening our profitability. Our efforts towards collections helped us in generating a consistent cash flow.

A Business Resilience Team (BRT) was formed at the Ambuja-ACC level to oversee and synergise actions on COVID-19. The cross-functional expertise of the BRT prepared us for the resumption of operations post lockdown period, helping us to quickly restart with the necessary regulations in place. During 2020, we achieved a capacity utilisation of 75% and reported a 2% de-growth in topline vis-à-vis the similar period during 2019.

Strong will to perform

Despite challenges, we arrested our revenue decline at just 2% against that in 2019. Operating EBITDA for the year grew from `2,149 crores in 2019 to `2,647 crores, while PAT strengthened from `1,529 crores in 2019 to `1,790 crores in 2020. Operating EBITDA margin for the year stood at 23.7%, against 18.9% in 2019 while PAT margin grew to 16% in 2020, against 14% in 2019.

Core initiatives

The Indian economy is showing signs of recovery at a rate faster than what was expected earlier, and the commencement of the vaccination drive in India and the world is bringing back positive sentiments to the market. The Indian cement industry’s fundamentals are already strong. To top it, the measures for economic revival announced by the government, including extension of interest subvention for affordable housing, and lower interest rates are expected to drive housing and infrastructure demand in the country in the medium term to long term.

Despite a temporary delay caused by the lockdown, we were quick to resume the construction of our upcoming plant at Marwar Mundwa in Rajasthan and expect to commence operations in 2021. With our market positioning, ongoing and future expansion plans, we expect to increase our market share. Our continued focus on value‑added products and premiumisation will also ensure that we remain a preferred brand in the retail market.

We are investing `525 crores towards Waste Heat Recovery Systems (WHRS) for enhanced use of green energy and optimisation of operating cost. The plants are expected to be operational by 2022.

The year 2020 also saw us implement cost-management initiatives so that our products can be made available to the market at cost-effective prices.

This initiative sets a strategic direction to build on core competencies, and foster collaboration for cost optimisation. Besides, our Master Supply Agreement (MSA) with ACC is helping us leverage group synergies, resulting in better cost control and healthy operating performance.

We have also initiated major digital transformation programmes across our legacy plants. This will give impetus to automation, leading to more efficient and sustainable operations.

Prepared for a new growth era

Though 2020 was a watershed year for all of us, It also showed how collaboration and sharper strategies can work miracles. While 2020 tested our capabilities and endurance, 2021 is setting the stage for a new era of growth and sustainability. I thank you all for your commitment and support; and invite you to partner our next journey of growth.

Warm regards,

Neeraj Akhoury
Managing Director and CEO
February 18, 2021