Risks and/or Opportunities

Ambuja’s Initiatives

Climate change

Ambuja’s Initiatives

Being an energy intensive industry, climate change poses risks which are evident in our operations and their mitigation represents a key aspect of our sustainability strategy. Potential risks emanating out of climate change include: Exposure of our facilities around coastal regions to physical risks. These include one of our large manufacturing facilities as well as a bulk cement terminal. Rising sea levels can challenge the operations of our bulk cement terminals which are used to transport cement in bulk through the sea route. The Company also has two large manufacturing facilities in water scarce regions. Water availability issues in these regions due to climate change may put plant operations at risk.

We continue to focus on the four levers in our operations to address the challenges of climate change. These are - Reduction in clinker factor; Improving thermal energy efficiency & process technology; Optimising fuel composition, including the use of wastes as fuel; and Waste heat recovery. The international standard ISO 50001:2011 is also being implemented to further strengthen our energy management system. Our Rabriyawas, MCW & Darlaghat integrated plants have obtained certification. We have also been able to reduce our specific net carbon footprint by almost 28% in 2014 compared to 1990 levels. Currently we are monitoring and reporting GHG emissions through the WBCSD CSI Initiative CO2 Emissions Inventory. We have continued to focus on production of fly ash based PPC as our major product.

Logistics

Increasing logistics expense is another area of concern for the industry. One of the major costs is the distribution cost.

The industry has witnessed a rise in the movement of cement through the sea route to optimise distribution costs. Ambuja is continuously working towards strengthening its costal distribution network, while at the same time trying to bring down distribution and logistics costs. In 2014, around 24% of our dispatch (including exports) was via sea.

Local Communities

The Company has manufacturing sites in rural areas of the country. The rural communities face widespread income inequalities, which are often a source of discontent and social unrest. The communities therefore have high aspirations from the Company. In addition, there are changes in society owing to the large inflow of migrant population, truck force in the area etc. Contented communities help in the smooth running of the business.

The Company extracts limestone from its captive mines. These mines, being captive, allow better operational control from the quarry to the finished product, which supports quality enhancement. It continues to adopt state-of-the-art mining techniques with due regard to pollution control, environment preservation, and safe mining. We employ the best available technologies with minimal disturbance. The technologies employed include surface miners which cut imestone without blasting; and the latest controlled lasting technique which allows mineral extraction with minimal noise and vibration. As a responsible company, Ambuja uses over land belt conveyor (OLBC) systems for transportation of limestone from the mine to the stockpile. Mine rehabilitation is an important environmental aspect and the Company takes it seriously. In order to prevent degradation of the mined out areas, the Company has meticulous plans for their rehabilitation and post mining use.