We are committed to contribute in nation building by producing quality cement.

- Gautam Kanodia

Director, Kanodia Cement

Government has taken various initiatives by focusing on increasing construction activities and taking up infrastructure development projects. In this backdrop, how do you see the demand for cement growing in the next fiscal?

The construction sector plays a very important role in the Indian economy. It contributes approximately 5% of the country GDP, and has increased its share to almost 8%.  Infrastructure sector occupies the highest percentage i.e 13 % of total Foreign Direct Investment (FDI). The Union Budget 2021-22 has given a major boost to the country's beleaguered construction industry with a planned capital expenditure of USD 5.8 billion, which is an increase of 34.5 percent from the last year's budget. With the government focusing on infrastructure to drive economic growth, the construction industry is expected to rebound 14.5 percent in the financial year 2021-22. The major government initiatives in the construction sector are construction  of  national & state highways, metro rail & freight corridor, 100 smart cities, rural & urban housing scheme, subsidy of affordable housing, Swach Bharat Mission 2.0, Jal Jeevan Mission, reduction of 7.50% custom duty on steel, various development works in election bond states in the year  2021& 22 etc, which will increase the cement demand and benefit  the cement industry.

Can you tell us about the demand in the domestic market vis a vis the international demand? Can you elaborate on the opportunities?

The Indian economy is in the process of transforming from a developing economy to a developed economy. Assuming that per capita cement consumption in India is presently 235 per kg per annum, the world average is around 500 kg and China is nearly 1000 kg.  Indian per capita cement consumption is lower in comparison to other developed nations. Cement consumption in 2020 was approx 327 MT and is expected to increase to 379 MT in 2022. Cement production capacity is estimated at 550 MT in 2020. Looking into the increasing demand of cement consumption, the demand of the cement industry is expected to reach 550-600 MT by 2025.

What are the challenges plaguing the sector from both domestic and international front in terms of liquidity, delay in approvals, fuel price, etc.? What, according to you, needs to be done to ensure the bottlenecks are removed?

In the Indian cement industry, limestone deposit is limited to certain regions only and major limestone deposits are owned by old and major players which prevent new players from entering the Industry. New entrants are fully dependent   on existing players for clinker. Cement industry is capital intensive and has a high gestation period due to seeking various statutory approvals. Cement industry attracts the highest rate of GST .i.e 28%. Power cost, good quality of coal, pet coke, lignite etc are the major problems for the cement industry in India. Although, in cement & other raw materials, share of road transportations has increased in recent years due to mass networking of  highways, but in peak time railways have been unable to provide sufficient wagons  to cement industry which badly hampered the industry production & despatches.

Tell us about the impact of Covid pandemic on the sector and how is the industry dealing with it? Also tell us about the initiatives taken by your company to deal with these challenges?

The Covid pandemic has badly hit the world's economic and social fabric and naturally the Indian cement industry was no exception. The first phase of complete lockdown in March/April- 2020, badly affected the production and dispatches. With the mass migration of labour from urban to rural India, urban construction works like the real estate sector, infrastructure projects etc were very badly affected. But Central & various state governments have launched & sped up existing projects in rural areas, which gave a major  support to the cement and construction industry. The changes in social behaviours due to social distancing brought in new challenges in the business. 'Work from home' and 'remote location working' have brought a new dimension to the way we work and interact. In this situation Information Technology has become a big saviour for us. Considering the government guidelines and safety of our employees, we have undertaken help of various IT tools like Google meet, Zoom meet, and Duo Call, Digital collection & payment etc and work from home culture. 

What role is technology playing in the manufacturing process and how far have you adopted it in your processes?

Our plants consist of state-of-the-art technology with a vertical roller-pre grinding mill (VRPM) in combination with ball mill, which is more efficient in terms of specific power consumption concerning other technologies. Type cascading separator and a fourth- generation dynamic classifier will be used for the separation of the fines. Window shopping modes of procurement were utilised to reduce project costs and ensure equipment quality. The equipment and their suppliers have been selected carefully. The plants layout/ engineering was done in- house by our highly professional team of technocrats. The system will not only be used for grinding and separating, but also simultaneously drying the feed materials, which may have moisture content of up 3%.  All the plants are equipped with automatic roto-packer with 12 nozzle and electronic weigh- bridge.

Can you tell us about how the cement manufacturers geared themselves (capex plans, expanding manufacturing capacities, new products) to meet the expected rise in domestic demand? Also, tell us about your future plan.

The cement consumption is expected to reach 550-600MT per annum by 2024-25. As per crisils rating the Indian cement industry is likely to add around 80 million tonne (MT) by 2024, the highest since the last 10 year, driven by increasing spending on housing, concrete roads, and other developmental infrastructural projects. Considering increasing demand apart from our existing 5 million tonnes capacity, we are also planning to commission a clinkerisation unit having capacity of 3 million tonne (MT) by 2025 which will cater the clinker requirement of our all grinding units. In nut sell Kanodia Group is committed to contribute in nation building by producing quality cement to cater the needs of its valued customers.

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