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A

Seminar Report

On

Study of Positioning of PPC (Portland Pozzolana Cement) &PSC (Portland Slag


Cement) Cements

BY

UMESHANAND GIRI GOSWAMI

Session 2008-10

IN PARTIAL FULFILLMENT OF MASTER OF BUSINESS ADMINISTRATION


DEGREE

DISHA INSTITUTE OF MANAGEMENT AND TECHNOLOGY, RAIPUR

Study on Positioning of PPC And PSC Cement 1


DISHA INSTITUTE OF MANAGEMENT AND TECHNOLOGY
Satya Vihar, Vidhansabha-Chandrakhuri Marg (Baloda Bazaar Road), Mandir Hasaud, Dist-Raipur (C.G.) Pin-
492101
Tel No. : 0771-4200100-09, Fax No. : 0771-4200110, 2472010
Website: www.dimatindia.com, Email: info@dimatindia.com

CERTIFICATE

This is to certify that


Mr./Ms…………………………………………………………………… of DIMAT, MBA
Semester –IV has successfully completed his Seminar Report in partial fulfillment of
requirement for the award of MBA Degree prescribed by the Chattisgarh Swami
Vivekanand Technical University, Bhilai.

This report is the record of authentic work carried out by the student during the
academic year 2008-09.

Internal Guide Academic In charge

Prof Sanjay Mishra Dr R A S Benedict (Faculty of Management)

Please do all the correspondence at:

City office: Disha Towers, New Shanti Nagar, Raipur (C.G.) 492007 PH.:+91-771-40353225-28, 33, 34 Fax: 0771-4035333

Study on Positioning of PPC And PSC Cement 2


DECLARATION

I Mr. Umeshanand Giri Goswami student of MBA 4th semester hereby declare that

this project report is the record of authentic work carried out by me during this

academic year to fulfil the universities criteria at per my level best. This is not similar

to any project prepared so and has not been submitted earlier to any institute but it is

for the award of my MBA degree.

Place: Name:

Date: Signature:

Study on Positioning of PPC And PSC Cement 3


ACKNOWLEDGEMENT

I express my deepest gratitude to management of our institution, for giving us such


an opportunity in our curriculum to carry out independent research and understand
the market to the fullest extent. My special thanks to Prof Sanjay Mishra for providing
extremely valuable inputs in the very early stage of my project and helping me
understand the objectives of the study.

The completion of this project would have been extremely difficult without the never
ending and blooming inspiration from my teachers specially Dr Satish Benedict, Prof
J.K.Dewangan, Prof Anish Abraham, Prof Siddhath Bhattacharya. Further I wish to
thank my colleagues who have always boosted my morale and filled me with “can do
“attitude because of which I pursued my willingness in successive direction to
complete this report in the corridors of DIMAT. I would like to express my special
thanks to my friends helping me carry out the work with ease and comfort.

Above all I thank my family, for their constant motivation and support. It was just
because of their divine love and support that made me work properly and complete
my objectives in a splendid manner. Finally I thank the Almighty for creating an aura
of favourable situations for me and guiding me throughout the pathway.

Study on Positioning of PPC And PSC Cement 4


Contents

Seria Topic Page No.


l NO.
01 Abstract (Executive Summary) 6-8
02
 Corporate Profile Indian Cement Industry 9-22

 Cement Industry 9-10

 Growth Trend in Cement Industry 11-17

17-22
 Factors Affecting Cement Industry

03 Project Profile
22-23
 Introduction Portland Cement

 Cement Process
23-25

 Marketing Mix 26-34


(Product, Price, Place, Promotion & Positioning)
34-35
 Selling Channels

04
Production Process & Cement Production in India

 Manufacturing Process 36-38


 Cement Production in India 38-39

05 Research Methodology 40-42


06 Objective of the Study 43-44
07 Observation and Analysis 45-48
08 Bibliography 48-49
09 Questionnaire 49-51

Study on Positioning of PPC And PSC Cement 5


Executive Summary

It is a general phenomenon that buyers in same market seek products for broadly
the same function, but different buyers have different evaluative criteria about what
constitute the right choice of performing the function. As a consequence different
offering will attract different buyers. A market segment is explained to mean
homogeneous group consisting of buyers who seek the same offering. In other
words Market Segmentation may be defined, as the division of the market in to
groups of segments having similar wants. But wants must be interpreted very
broadly, broader than products characteristics only. Segment may differ also in their
needs for information, reassurance, technical support, service, promotion,
distribution and host of other non-products benefits that are part of their purchases;
they may also differ in their capacity for these differences.

Regions, known to be unpredictable like Bihar, Madhya Pradesh, Uttar Pradesh,


Orissa and other parts of the Country. One of the major section, which requires or
purchases cement in bulk quantity are engineers, architect, builders and contractors.
This section or segment is known as the non-trader segment. And the retailers,
stockists, whole-sellers and dealers are known as trader segment.

Cement is the element which brings the constructed structures and architectures
lively; it’s the essence of every kind of constructional bond it’s the thing which
furnishes the structures and adds value to their creation.

Further when we talk about cement and its contaminations and various types there is
lot of things to be considered in this prospective. As Portland cement was firstly used
in energy services industry in 1903 to isolate the oil-containing region of the earth
from down-hole water, a process in modern scenario referred to as zonal isolation.
The technique of oil well cementing was soon developed. After the primary hole is
drilled, a steel casing, through which the oil will later flow, is placed inside. Drilling
mud is used to assist in the actual drilling. The cement is pumped down the steel
casing to the bottom of the well and then back up through the free annular space
between the casing and the well, where it serves to bond the casing to the rock
formation and to prevent fluids from moving from one formation to another (hence

Study on Positioning of PPC And PSC Cement 6


the term zonal isolation). Displacement fluids, such as fresh water, sea water, and
weak acid solutions, are used to push the cement out of the casing. To avoid
damage to the pumping equipment used to place the cement slurry, the cement must
remain a fluid state for several hours while it is pumped into place; to avoid wasting
valuable rig time, the cement should set shortly after being placed.

In 1929, Pacific Portland Cement Company developed the first retarded cement,
which allowed cement to be used in deeper oil wells than previously possible. The
construction of the first bulk cement production stations in the early 1940’s made the
use of cement additives more practical. The desire for deeper wells drove the
development of new retarders that could predictably delay cement setting for longer
periods of time than traditional retarders.

Today, oil wells are commonly 2 - 3 miles deep, at which depth temperatures of 180
°C are not uncommon. Cement pumped to the bottom of these wells is subject to
pressures approaching 150 MPa. Cement must remain as thin as possible under
these conditions, yet begin to set and develop strength soon after it is in place so
that oil drilling can continue. The demanding needs of the industry have sparked a
plethora of empirical investigations into the effect of different additives on cement
setting. More recently, investigations into the mechanisms of cement hydration and
hydration inhibition have begun in an attempt to develop a more rational
methodology for the design of cement additives.

Study on Positioning of PPC And PSC Cement 7


Basic objective to prepare this report is to critically evaluate the role of Portland
cement in construction works and its respective position in among its rivals and other
variants with refers to cement industry.

Study on Positioning of PPC And PSC Cement 8


Corporate
Profile
Indian
Cement
Industry

Study on Positioning of PPC And PSC Cement 9


CEMENT INDUSTRY

Cement is a key infrastructure industry. It has been decontrolled from price and
distribution on 1st March, 1989 and delicensed on 25 th July, 1991. However, the
performance of the industry and prices of cement are monitored regularly. The
constraints faced by the industry are reviewed in the Infrastructure Coordination
Committee meetings held in the Cabinet Secretariat under the Chairmanship of
Secretary (Coordination). Its performance is also reviewed by the Cabinet
Committee on Infrastructure.

Capacity and Production

The cement industry comprises of 125 large cement plants with an installed capacity
of 148.28 million tones and more than 300 mini cement plants with an estimated
capacity of 11.10 million tones per annum. The Cement Corporation of India, which
is a Central Public Sector Undertaking, has 10 units. There are 10 large cement
plants owned by various State Governments. The total installed capacity in the
country as a whole is 159.38 million tones. Actual cement production in 2002-03
was 116.35 million tones as against a production of 106.90 million tones in 2001-02,
registering a growth rate of 8.84%.

Keeping in view the trend of growth of the industry in previous years, a production
target of 126 million tones has been fixed for the year 2003-04. During the period
April-June 2003, a production (provisional) was 31.30 million tones. The industry has
achieved a growth rate of 4.86 per cent during this period.

Study on Positioning of PPC And PSC Cement 10


Growth Trend in Cement Industry

The Indian cement industry is on a roll. Driven by a booming housing sector, global
demand and increased activity in infrastructure development such as state and
national highways, the cement industry has outpaced itself, ramping up production
capacity, attracting the top cement companies in the world, and sparking off a spate
of mergers and acquisitions to spur growth. 

The recent boom in the housing and construction industry in India has worked
wonders for cement manufacturing companies with capacity utilization crossing the
100 per cent mark for the first time in January 2007. 

According to Cement Manufacturers Association (CMA), the average monthly


capacity utilization during fiscal 2006-07 was 94 per cent. Also, cement dispatches
for the recently concluded fiscal was at an all-time high of 155 million tones (mt), up
from 142 mt in the previous fiscal, thereby recording a growth of 10 per cent. More
particularly, the dispatches for March 2007 stood at 15.08 mt as against an installed
capacity of 14.95 mt. 

Production

Globally, India is the second largest producer of cement. Cement production grew at
the rate of 9.1 per cent during 2006-07 over the previous fiscal's total production of
147.8 mt. Of this, 9.3 million tonne of cement was exported. 

The Indian cement industry comprises 130 large cement plants and 365 mini-cement
plants, with installed capacities of 165 million tonnes per annum (mtpa). Large
cement plants accounted for over 94 per cent of the total installed capacity. 

Study on Positioning of PPC And PSC Cement 11



Despite the growth of the Indian cement industry, India's per capita production
of 115 kilograms per year lags the world average of over 250 kilograms and
China's production of more than 450 kilograms per person. Clearly there
remains room for growth in the industry in India. 

The cumulative FDI inflows into the cement and gypsum industry have been
US$ 989 million from August 1991 to March 2007 representing 2.26 per cent
of the total FDI inflows into the country. 

Financial Performance

Majority of the cement companies witnessed a surge in their sales volume,


which was led by rising demand. The impact of high demand growth was
evident in the continuous northward movement of prices. Concurrently,
companies reported higher production, higher sales and higher profits. The
net profit growth rate of cement firms was 85 per cent in the fourth quarter
ended March 2007: 

 Ultra Tech Cement reported a 76 per cent rise in net profit at US$ 56.65
million in the last quarter of 2006-07. 
 Ambuja Cements grew by 43 per cent to US$ 144.23 million. 
 ACC net profit rose 54.5 per cent to US$ 88.82 million. 
 Sanghi Cement recorded a 75 per cent growth at US$ 34.89 million in net
profit in 2006-07.

Study on Positioning of PPC And PSC Cement 12


Mergers and Acquisitions

the booming demand for cement, both in India and abroad, has attracted global
majors to India. In 2005-06, four of the top-5 cement companies in the world entered
India through mergers, acquisitions, joint ventures or Greenfield projects. These
include France's Lafarge, HOlCIM from Switzerland, Italy's Italcementi and
Germany's Heidelberg Cements. While Lafarge is investing over US$ 500 million in
India to expand capacities by six million tonne, Italcementi will invest US$ 174 million
over the next two years in various Greenfield and acquisition projects. 

The Indian cement industry has also witnessed a flurry of mergers and acquisitions
within the domestic players, bringing smaller players under the umbrella of larger
companies, and larger companies coming under the umbrella of global players like
HOlCIM and Heidelberg. The top two groups in the industry, Aditya Birla Group and
HOlCIM Group, now control more than 40 per cent of total capacity in the country.
Further, more than a quarter pie of total capacity is now being controlled by global
majors. 

HOlCIM

The HOlCIM Group entered India in January 2005 through a strategic alliance with
Gujarat Ambuja Cement Limited (GACL). It acquired a further 67 per cent stake in
the GACL group company Ambuja Cement India Limited (ACIL), the holding
company of the Ambuja Group. ACIL in turn holds around 35 per cent stake in ACC
and 97 per cent stake in Ambuja Cement Eastern Limited (ACEL). In January 2006,
HOlCIM acquired 14.8 per cent stake in GACL following it up with another 3.7 per
cent over the next few months. This took Holcim's total holding in the company to
18.5 per cent. Its holding further increased to 28 per cent when ACEL merged with
GACL. Recently, HOlCIM acquired additional 11 per cent stake in ACIL taking its
total shareholding in the company to 78 per cent. 

Study on Positioning of PPC And PSC Cement 13


HOlCIM has further increased its stake in Indian cement company ACC taking its
total holdings in the company to 41.6 per cent. HOlCIM is now the largest
shareholder in the company. Also, presently it holds 78 per cent of total share
holdings in ACIL. 

HOlCIM now commands around 25 per cent of the total market share with 34.2 mt
capacities through ACC and Ambuja. India represents its single largest country
exposure at about 18 per cent of its total country exposure. The other large group,
Birla, controls another 31.2 mt of the country's cement capacity through group
companies Grasim Industries and Ultratech Cements. 

Lafarge

The French cement major, Lafarge, has acquired the cement plants of Raymond and
Tisco in the recent past, and currently has an installed capacity of 6 mtpa. It plans to
double its capacity to 12 mt over the next five years by adopting the Greenfield
expansion route. 

Italcementi

Italy based Italcementi has acquired a stake in the K.K. Birla promoted Zuari
Industries' cement plant in Andhra Pradesh, with a capacity of 3.4 mtpa. 

Heidelberg

Heidelberg Cement has entered into an equal joint-venture agreement with S P


Lohia Group controlled Indo-Rama Cement. Heidelberg Cement is expected to take
a 50 per cent controlling stake in Indo-Rama's grinding plant of 0.75 mtpa at Raigad
in Maharashtra. Heidelberg is also taking over Mysore Cement of S K Birla group at
a consideration of US$ 93 million. 

Study on Positioning of PPC And PSC Cement 14


Demand Projection

given the sustained growth in the housing sector, the Government's emphasis on
infrastructure (at both the national and the state level) and increased global demand,
the outlook for India's cement industry is exceedingly bright. 

The demand growth for the current fiscal is expected to be in the region of 10 per
cent, which will translate into a demand of 175 mt. 

To meet this rising demand, many Indian companies are going for capacity
expansion. Close to 54 mt of additional capacity is to come up in the next three
years, with an investment of around US$ 5.31 billion. 

According to a Deutche Bank report, close to 5.1 mt will be added by second half of
2007-08, while 11.46 mt will be added in 2008-09. Around 28.90 mt is likely to be
added in 2009-10 and 2.87 mt in 2010-11. 

A similar projection by National Council of Applied Economic Research (NCAER) for


cement consumption, on a conservative basis, has placed cement demand at 225 mt
by the fiscal year 2011. If the Government goes ahead with infrastructure projects as
planned, consumption is likely to be much higher at 291 mt.

Study on Positioning of PPC And PSC Cement 15


Exports

Apart from meeting the entire domestic demand, the industry is also exporting
cement and clinker. The export of cement during 2001-02 and 2003-04 was 5.14
million tones and 6.92 million tones respectively. Export during April-May, 2003 was
1.35 million tones. Major exporters were Gujarat Ambuja Cements Ltd. and L&T Ltd.

Recommendations on Cement Industry

For the development of the cement industry ‘Working Group on Cement Industry’
was constituted by the Planning Commission for the formulation of X Five Year Plan.
The Working Group has projected a growth rate of 10% for the cement industry
during the plan period and has projected creation of additional capacity of 40-62
million tones mainly through expansion of existing plants. The Working Group has
identified following thrust areas for improving demand for cement;

(i) Further push to housing development programmes.


(ii) Promotion of concrete Highways and roads; and
(iii) Use of ready-mix concrete in large infrastructure projects.

Further, in order to improve global competitiveness of the Indian Cement Industry,


the Department of Industrial Policy & Promotion commissioned a study on the global
competitiveness of the Indian Industry through an organization of international
repute, viz. KPMG Consultancy Pvt. Ltd. The report submitted by the organization
has made several recommendations for making the Indian Cement Industry more
competitive in the international market. The recommendations are under
consideration.

Study on Positioning of PPC And PSC Cement 16


Technological change

Cement industry has made tremendous strides in technological up gradation and


assimilation of latest technology. At present ninety three per cent of the total
capacity in the industry is based on modern and environment-friendly dry process
technology and only seven per cent of the capacity is based on old wet and semi-dry
process technology. There is tremendous scope for waste heat recovery in cement
plants and thereby reduction in emission level. One project for co-generation of
power utilizing waste heat in an Indian cement plant is being implemented with
Japanese assistance under Green Aid Plan.

The induction of advanced technology has helped the industry immensely to


conserve energy and fuel and to save materials substantially. India is also
producing different varieties of cement like Ordinary Portland Cement (OPC),
Portland Pozzolana Cement (PPC), Portland Blast Furnace Slag Cement (PBFS), Oil
Well Cement, Rapid Hardening Portland Cement, Sulphate Resisting Portland
Cement, White Cement etc. Production of these varieties of cement conform to the
BIS Specifications. It is worth mentioning that some cement plants have set up
dedicated jetties for promoting bulk transportation and export.

Factors Affecting Cement Industry:

LIMESTONE RESERVES

Limestone is the main raw material for manufacture of cement. For manufacture of
one tonne of cement, a quantity of 1.5 tonne of limestone is required. India is
endowed with large deposits of limestone. The estimated total reserves of cement-
grade limestone are 95.623 billion tonnes. However, the limestone deposits are not
uniformly distributed in all the States. There is a concentration of about 73 per cent
of the total reserves in five States, namely, Andhra Pradesh, Karnataka, Gujarat,
Rajasthan and Madhya Pradesh. This concentration is about 48 per cent in South
Zone, 23 per cent in North Zone, 21 per cent in West Zone and the remaining 8 per
cent in East Zone.
COAL
Study on Positioning of PPC And PSC Cement 17
The consumption of coal in a typically dry process system ranges from 20-25% of
clinker production. This means for per ton clinker produced 0.20-0.25 ton of coal is
consumed. This contributes 35-40% of the production cost. The cement industry
consumes about 10mn tons of coal annually. Since coalfields like BCCL supply a
poor quality of coal, NCL and CCL the industry has to blend high-grade coal with it.
The Indian coal has a low calorific value (3,500-4,000 kcal/kg) with ash content as
high as 25-30% compared to imported coal of high calorific
value 14 (7,000-8,000 kcal/kg) with low ash content 6-7%. Lignite is also used as a
fuel by blending it with coal. However this process is not very common.

ELECTRICITY

Cement industry consumes about 5.5bn units of electricity annually while one ton of
cement approximately requires 75-85 units of electricity. Power tariffs vary according
to the location of the plant and on the production process. The state governments
supply this input and hence plants in different states shall have different power
tariffs. Another major hindrance to the industry is severe power cuts. Most of the
cement producing states like AP, MP experience power cuts to the tune of 25-30%
every year causing substantial production loss.

TRANSPORTATION

Cement is mostly packed in HDPE (High Density Poly Ethylene) bags. It is then
transported either by rail or road. Road transportation beyond 200 kms is not
economical therefore about 55% of cement is being moved by the railways. There is
also the problem of inadequate availability of wagons especially on western railways
and south-eastern railways. Under this scenario, manufacturers are looking for sea
routes, this being not only cheap but also reducing the losses in transit. Today, 70%
of the cement movement worldwide is by sea compared to 10% in India. However,
the scenario is changing with most of the big players like ACC and Ultratech having
set up their bulk terminals.

Study on Positioning of PPC And PSC Cement 18


Cement Industry has been in existence in India for over eight decades. From the
initially available wet process technology the industry has travelled through semi-dry
and the latest energy efficient dry process technology. Recent plants have been
erected with state-of-art technology comparable to those available in the world. The
earlier cement plants that came into existence were mostly of small kiln capacities of
300 to 600 tpd based either on wet or dry process; however, the new plants set up
later were of the order of 3000 tpd or more exclusively of dry process. Kilns of the
capacities 5000 to 7000 tpd are also in operation now. At present 15 91% of the
total kiln capacity comprise dry process, 7% wet process and the remaining 2% on
semi-dry process based technologies. Indian cement industry has been actively
pursuing various avenues to improve its productivity and energy efficiency. There
has been all-around up gradation of technology in all sections of the plant like
mining, process, equipment and machinery, packaging and transportation. Adoption
of modern techniques like photo-grammetry and remote sensing has enabled the
industry to discover virgin limestone. Advanced equipment like hydraulic excavators,
surface miners, large wheel loaders and mobile crushers have helped the industry in
increasing its productivity considerably. The modern raw material evaluation and
management system starts from computerized mine planning through on-line bulk
material analysis to automated X-ray analysis and process computers to control the
weigh feeders. Expert systems based on ‘fuzzy logic’ are used to control the
operation of kilns and mills to ensure that the process systems operate at optimum
levels of energy efficiency all the time. Energy efficient technologies are being
adopted for a new as well as for retrofits, modernization and expansion of existing
plants. A number of cement plants in the country are now equipped with double
string pre-heater towers with pre-calciners, vertical roller mills, roller presses, high
efficiency fans and motors with slip power recovery systems. Besides this, the
software approach involving detailed process diagnostic studies and energy audits
are used successfully by almost every large and medium sized cement plant in the
country.

Study on Positioning of PPC And PSC Cement 19


ENERGY CONSERVATION

The cement industry is an energy intensive industry by virtue of high temperature


reactions and various physical operations involved in its manufacture. The industry
uses both coal and power as energy inputs. The cost of energy accounts for about
45% of the total production cost. Energy management in modern cement plants in
India meets the standards comparable with the best in the world. Energy studies of
cement plants are being carried out in a large number of plants on a continuing basis
by the National Council for Cement & Building Materials (NCB). NCB has a mobile
energy diagnostic unit (Energy Bus) equipped with necessary instrumentation and
on-board computer with relevant software for conducting the energy studies on
systematic 16 and accurate manner.NCB has electrical energy consumption and
accurate manner.NCB has been giving National Awards for (kWh/t Cement) energy
efficient in Indian Cement Industry to the best performing cement plants on annual
basis since 1986. Based on the recent data of 51 participating plants, the weighted
average energy consumption is thermal energy consumption (Kcal/kg Clinker)

Study on Positioning of PPC And PSC Cement 20


Project Profile

Study on Positioning of PPC And PSC Cement 21


Introduction

Ordinary Portland cement

Ordinary Portland cement is the most commonly used cement for a wide range of
Applications. These applications cover dry-lean mixes, general-purpose ready-
mixes, and even high strength pre-cast and pre-stressed concrete.

Portland blast furnace slag cement

Portland blast-furnace slag cement contains up to 70 per cent of finely ground,


Granulated blast-furnace slag, a non-metallic product consisting essentially of
silicates and alumina-silicates of calcium. Slag brings with it the advantage of the
energy invested in the slag making. Grinding slag for cement replacement takes only
25 percent of the energy needed to manufacture Portland cement. Using slag
cement to replace a portion of Portland cement in a concrete mixture is a useful
method to make concrete better and more consistent. Portland blast-furnace slag
cement has a lighter colour, better concrete workability, easier finish ability, higher
compressive and flexural strength, lower permeability, improved resistance to
aggressive chemicals and more consistent plastic and hardened consistency.

Portland Pozzolana cement

Portland Pozzolana cement is ordinary Portland cement blended with pozzolanic


Materials (power-station fly ash, burnt clays, ash from burnt plant material or silicious
Earths), either together or separately. Portland clinker is ground with gypsum and
Pozzolanic materials which, though they do not have cementing properties in
Themselves, combine chemically with Portland cement in the presence of water to
form extra strong cementing material which resists wet cracking, thermal cracking
and has a high degree of cohesion and workability in concrete and mortar.

Study on Positioning of PPC And PSC Cement 22


The Product and Brand names are as follows:
(With reference to Aditya Vikram Birla Group)

Units Products Brand Name

Birla cement works OPC-43G,55G,PPC Birla Cement Chetak


Chanderia Cement work
Birla Cement Samrat

Satna Cement Works PPC & OPC (43 Gr.) Birla Cement Samrat
Birla Vikas Cement Birla Cement Khajuraho

Raebareli Grinding Unit Portland Pozzolana Birla Cement


Cement (PPC) Birla Premium Cement

Durgapur Cement Works Portland Slag Cement Birla Cement


(PSC) Birla Premium Cement

Durga Hitech Cement Portland Pozzolana Birla Cement Samrat


Cement (PPC)

Special features Birla Cement Samrat

Low heat of hydration which prevent cracks in concrete.

Prevent iron from corrosion due to low chloride contains.

Resistance against water leakage.

Ability to handle high pressure.

Low setting time & need less water for it.

Long life due to low magnesium and tricalcium aluminates.

Study on Positioning of PPC And PSC Cement 23


Cement Process

Cement acts as a bonding agent, holding particles of aggregate together to form


concrete. Cement production is highly energy intensive and involves the chemical
combination of calcium carbonate (limestone), silica, alumina, iron ore, and small
amounts of other materials. Cement is produced by burning limestone to make
clinker, and the clinker is blended with additives and then finely ground to produce
different cement types. Desired physical and chemical properties of cement can be
obtained by changing the percentages of the basic chemical components (CaO,
Al2O3, Fe2O3, MgO, SO3, etc.).

Most cement produced is Portland cement: other cement types include white,
masonry, slag, aluminous, and regulated-set cement. Cement production involves
quarrying and preparing the raw materials, producing clinker through pyro
processing the materials in huge rotary kilns at high temperatures, and grinding the
resulting product into fine powder. The following detailed description is borrowed
from the World Energy Council (1995).

Raw Materials Preparation

Raw materials preparation involves primary and secondary crushing of the quarried
Material, drying the material (for use in the dry process) or undertaking a further raw
Grinding through either wet or dry processes, and blending the materials. The
energy consumption in raw materials preparation accounts for a small fraction of
overall primary energy consumption (less than 5%) although it represents a large
part of the electricity consumption.

Clinker Production

Clinker production is the most energy-intensive step, accounting for about 80% of
the energy used in cement production in the United States. Produced by burning a
mixture of materials, mainly limestone (CaCO3), silicon oxides (SiO2), aluminium,
and iron oxides, clinker is made by one of two production processes: wet or dry;

Study on Positioning of PPC And PSC Cement 24


these terms refer to the grinding processes although other configurations and mixed
forms (semi-wet, semi-dry) exist for both types.
In the wet process, the crushed and proportioned materials are ground with water,
mixed, and fed into the kiln in the form of slurry. In the dry process, the raw materials
are ground, mixed, and fed into the kiln in their dry state. The choice among different
Processes are dictated by the characteristics and availability of raw materials. For
example, a wet process may be necessary for raw materials with high moisture
content (greater than 15%) or for certain chalks and alloys that can best be
processed as a slurry. However, the dry process is the more modern and energy-
efficient configuration.

Once the materials are ground, they are fed into a kiln for burning. In modern kilns,
the raw material is preheated (in four to five stages) using the waste heat of the kiln,
or it is pre-calcined. During the burning or Pyroprocessing, the water is first
evaporated after which the chemical composition is changed, and a partial melt is
produced. The solid material and the partial melt combine into small marble-sized
pellets called clinker.

Finish Grinding

Cooled clinker is ground in tube or roller mills and blended by simultaneous grinding
and mixing with additives (e.g., gypsum, anhydrite, Pozzolana, fly-ash or blast
furnace slag’s) to produce the cement. Drying of the additives may be needed at this
stage.

Study on Positioning of PPC And PSC Cement 25


Marketing
Mix (Product, Pricing
Place, Promotion &

Positioning )

Study on Positioning of PPC And PSC Cement 26


Product Portland Pozzolana Cement

PPC is a kind of cement which is produced either by integrating the OPC clinker
along with gypsum and pozzolanic materials and in the certain proportions.

Pozzolana is a natural or artificial material containing silica. Pozzolana materials


are:-

 Volcanic Ash
 Calcined Clay
 Fly Ash
 Lica Fumes

It is Suitable for Construction like:-

 Hydraulic Structures
 Mass Concreting Works
 Marine Structure
 Aggressive Conditions
 Where OPC is used
 Masonry Mortars and Plastering

Product Portland Slag Cement


PSC is a kind of cement which is slag based blended cement that imports strength
and durability to all structures. It is manufactured by blending OPC clinker and
granulated slag in suitable proportions as per norms.

Basic slag is a by-product of steelmaking by the basic version of the Bessemer


process or the Linz-Donawitz process. It is largely limestone or dolomite which has
absorbed phosphate from the iron ore being smelted. Because of the slowly-

Study on Positioning of PPC And PSC Cement 27


released phosphate content, as well as for its liming effect, it is valued as fertilizer in
gardens and farms in steelmaking areas.

It is suitable for construction like:-

 Concrete Creation
 Cannel Plantation
 Bridge Construction
 Oil Rick Construction
 Machinery Installation
 Engineering Instruments Installation

According to the American Association of Plant Food Control Officials, basic slag
must contain at least 12% total phosphoric acid (P2O5) or be labelled "low
phosphate".

Ground granulated slag is often used in concrete in combination with Portland


cement as part of a Blended Cement. Ground granulated slag reacts with water to
produce cementations properties. Concrete containing ground granulated slag
develops strength over a longer period, leading to reduced permeability and better
durability. Since the unit volume of Portland cement is reduced, this concrete is less
vulnerable to alkali-silica and sulphate attack.

What was once an unwanted by-product of the steel making process can now be
recycled and used in the manufacture of high performance concretes?

When iron ore is heated in a blast furnace, the impurities or ‘slag’, which include


large quantities of calcium and silica, become molten and are separated from the
raw iron.

As the slag is channelled out of the furnace, thousands of gallons of water are
poured over it. This rapid cooling, often from a temperature of around 2,600°C, is the
start of the granulating process. This process causes several chemical reactions to
take place within the material, and gives the slag its cementations properties.

Study on Positioning of PPC And PSC Cement 28


The water carries the slag in its slurry format to a large agitation tank, from where it
is pumped along a piping system into a number of gravel based filter beds. The filter
beds then retain the slag granules, while the water filters away and is returned to the
system.

When the filtering process is complete, the remaining slag granules, which now give
the appearance of coarse beach sand, can be scooped out of the filter bed and
transferred to the grinding facility where they are ground into particles that are finer
than Portland cement

This previously unwanted recycled product is used in the manufacture of high


performance concretes, especially those used in the construction of bridges and
coastal features, where its low permeability and greater resistance to chlorides and
sulphates can help to reduce corrosive action and deterioration of the structure.

Pricing

Whenever it comes to pricing and value determination it severally differs for one to
another, but in case of Portland cements very less differentiation is there in pricing
like price of PPC and PSC for Birla cements is same, it’s similar in context of
Ambuja, Maiher and others only in case of JP cements ACC’s rate differs for both
PPC and PSC products.

Reason what really differentiates the pricing of the two for manufacturers is
availability of raw materials like clinker iron extracts and limestone as we have seen
in manufacturing process that every cement is the combination of above mentioned
materials.

Other reason for price differentiation could be logistic and transportation cost to
transfer materials from one place to another, like presently JP Cements is tied up
with Bhilai Steel Plant and brings its clinker from Reenva and limestone from Satna
which increases the cost of manufacturing and Company has to also look after its
profitability so the price differentiation arises there. Meanwhile few companies are
there whose products are really transformed form better quality process or some

Study on Positioning of PPC And PSC Cement 29


companies products possesses good quality materials which cost higher so you
have to get rid of profitability so you need to charge higher.

Above given reasons are related to manufacturing but apart from this other reasons
are there which leads to price differentiation like marketing strategies and product
differentiation that can be bring in the form of companies trying in the market to show
and position their product as premium product and so to make it somehow unique or
different from other products. That obvious also because there is immense pressure
of targets on divisions and one has to come up with some different products or
different marketing strategy in order to survive for longer span of time.

Here is the list of product with price:-

Products Company Price(Rupees) Std 50 Kg


Ambuja Ambuja Cement Ltd 248 Rs
Birla Gold AV Birla Group 255 Rs
Birla A1 AV Birla Group 240 Rs
Ultratech AV Birla Group 252 Rs
ACC ACC Ltd 252 Rs
JP Cement JP Associates 240 Rs
Binani Cement Braj Binani Group 259 Rs
Shri Ultra Red oxide Shri Cement Ltd 225 Rs
Cement
JK Lakshmi Cement Hari Shankar Singhania 293 Rs
Group
Prism Cement Rajan Raheja  Group 250 Rs

PLACE

Two type of distribution network mainly followed by the company are followings

Study on Positioning of PPC And PSC Cement 30


1. Trade- This is available for the distributer, in this type company supply the cement
Through deport or directly from the factory.

2. Non Trade- It is basically contract basis, it include contractors and government. It is for a
fix period at fix rate. There are two methods which followed by company regarding
transportation cost

1. To be billed- In this category company pay fright and transportation cost, it is


Applicable in stock transfer only. The company first supply the cement to depot then
Supply to the dealer.

2. To Pay- In this category supply cost is given by the stockiest or dealer. Application
In direct sale means from industry to Dealer. 75% transportation is through railway and rest
through from road.

Place plays very important role in the value chain to site the product and let it derive
its value and estimated position and it depends upon the companies strategy how
they are using it.

PROMOTION

Promotion a key element ingredient in marketing campaigns consists of diverse

Study on Positioning of PPC And PSC Cement 31


Collection of intensive tools. Sales promotion and incentive schemes are mostly short term
and designed to stimulate quicker or greater purchase of particular product or services by
consumer on the trade. The various sales promotion methods adopted by the company are:-
1. Advertisement through television, newspaper, hording, wall painting, calendar etc.
2. Dealers and retailers meet and training programme.
3. Architect and engineer meet.
4. Incentives schemes to dealers like cash discount, quantity discount, annual discount, target
setting, loyalty discount, annual visits to tourist places, annual gifts.
5. Dealer’s relationship programme like best seller award and other award programs.
6. Company visits to dealer’s shop.

TECHNICAL CONSUMER SERVICE CELL

Backed up with a dedicated team of highly skilled professional and experienced


Application Engineers, the cell functions in an advisory capacity. Besides handling their
constructional problems the cell offers all kind of assistance and guidance in the
Selection of the right cement for different application to ensure cost-effective, durable
And safe construction.

“Advertisements and Promotional” campaigns are created and executed in-house


by innovative marketing professionals’ involving whole gamut of activities right from
conceptualization to execution stage.

Positioning

Study on Positioning of PPC And PSC Cement 32


In the common market most preferred cement is Portland slag cement reason behind
so is its colour and physical propensity which has its pre established position in the
mind of prospect of customer. As most of the customer thinks and feels the black
colour as sign of cement which suits the cement and relevant construction purpose.
The slaty cum black colour means the cement stuff for them.

This is about the trend and scenario of mass market which lies in the rural market,
but Portland Pozzolana also has its premium position in the metro and majority of
towns just because of its whitened colour and ingredients. There people thinks that
white is the colour of prosperity and it truly appears on every other construction and
suits the process.

Positioning of Birla and Ultratech is excellent both belong to Aditya Vikram Birla
Group in context of Portland Pozzolana cement. Ultratech enjoys dominant 20
percent market share with wide coverage in the market.

Some of the renowned brands from Birla Cements are Birla Gold and Birla A1 type
of Portland Pozzolana Cements and have their influence in every corner of market.

But when we talk about Portland slag cement ACC enjoys the maximum market
share leaded by its organized sales force, wide distribution channel and quality
which comes from its branding.

Reason behind the success of Ambuja and ACC in the PAN India market Madhya
Pradesh, Chhattisgarh is because of HOlCIM that manages both companies it is
worlds second largest cement manufacturer and now AV Birla Group is eyeing for its
acquisition which will form them worlds second largest cement maker behind
LAFARGE which is worlds largest cement manufacturer.

Market Share of key Cement Manufacturer Birla Gold (PPC 53 Grade Cement):-

Serial No. State Share

Study on Positioning of PPC And PSC Cement 33


1 Bihar 25.91%
2 Uttar Pradesh 46.83%

3 Madhya Pradesh 17.86%

4 Uttaranchal 2.47%

5 West Bengal 1.15%

6 Assam 3.48%

7 Export 2.29%

SELLING CHANNELS: -

(1) Stock Transfer: In Bihar and Uttar Pradesh sales are through stock transfer to
company dumps. Handling Agents manage company’s godown / dumps and cement

Study on Positioning of PPC And PSC Cement 34


marketing under instruction of the company’s local office. Cement is sold through
dealers.

(2) Consignment Sale: Earlier sales in Bihar, Orissa, Assam, A.P. and N.E. States,
were made through Consignment Agents. The Consignment Agents used to develop
market and sale cement through dealers. Storage / Warehousing, sales, collection of
payment, tax payment and advertising in the area were under their responsibilities.
But now due to issues in Branding and due to customer dissatisfaction consignment
sale has been stopped.

(3) Dealer Sale: In Chhattisgarh, the company directly supplies material to dealers
against their orders and collects payment from them. These dealers either retail the
cement or sale in wholesale to sub dealers appointed by them.

(4) Direct Sale: Government Departments or private companies float tenders/


enquires from time to time for bulk supply of cement. The company actively
participates in these tenders. Marketing agents assist in getting orders/payments and
get small commission for the same.

Study on Positioning of PPC And PSC Cement 35


Production
Process &
Cement
Production in
India

MANUFACTURING PROCESS

Mining

Study on Positioning of PPC And PSC Cement 36


The cement manufacturing process starts from the mining of limestone, which is the
Main raw material for making cement. Limestone is excavated from open cast mines
After drilling and blasting and loaded on to dumpers which transport the material and
Unload into hoppers of the limestone crushers. Crushing Stacking & Reclaiming of
Limestone, The LS Crushers crush the limestone to minus 80 mm size and
discharge the material onto a belt conveyor which takes it to the stacker via the Bulk
material analyser. The material is stacked in longitudinal stockpiles. Limestone is
extracted transversely from the stockpiles by the reclaimers and conveyed to the
Raw Mill hoppers for grinding of raw meal.

Crushing Stacking & Reclaiming of Coal

The process of making cement clinker requires heat. Coal is used as the fuel for
Providing heat. Raw Coal received from the collieries is stored in a coal yard. Raw
Coal is dropped on a belt conveyor from a hopper and is taken to and crushed in a
Crusher. Crushed coal discharged from the Coal Crusher is stored in a longitudinal
Stockpile from where it is reclaimed by a reclaimer and taken to the coal mill hoppers
For grinding of fine coal.

Raw Meal Drying/Grinding & Homogenisation

Reclaimed limestone along with some late rite stored in their respective hoppers is
fed to the Raw Mill for fine grinding. The hot gasses coming from the Clinkerisation
Section are used in the raw mill for drying and transport of the ground raw meal to
the electrostatic Precipitator / Bag House, where it is collected and then stored and
Homogenised in the concrete silo. Raw Meal extracted from the silo (now called Kiln
Feed) is fed to the top of the Preheated for Pyroprocessing.

Study on Positioning of PPC And PSC Cement 37


Clinkerisation

Cement Clinker is made by Pyroprocessing of Kiln feed in the preheated and the
rotary kiln. Fine coal is fired as fuel to provide the necessary heat in the kiln and the
Precalciner located at the bottom of the 5/6 stage preheated. Hot clinker discharged
From the Kiln drops on the grate cooler and gets cooled. The cooler discharges the
Clinker onto the pan / bucket conveyor and it is transported to the clinker stockpiles /
Silos. The clinker is taken from the stockpile / silo to the ball mill hoppers for cement
Grinding.

Cement Grinding & Storage

Clinker and Gypsum (for OPC) and also Pozzolana (for PPC) are extracted from
their respective hoppers and fed to the Cement Mills. These Ball Mills grind the feed
to a fine powder and the Mill discharge is fed to an elevator, which takes the material
to a separator, which separates fine product and the coarse. The latter is sent to the
mill inlet for regrinding and the fine product is stored in concrete silos.
Packing Cement extracted from silos is conveyed to the automatic electronic packers
where it is packed in 50 Kgs. Polythene bags and dispatched in trucks.

Cement Production in India

Study on Positioning of PPC And PSC Cement 38


At present the Indian cement industry produces 13 different varieties of cement
employing three different process types. Amongst the varieties, Ordinary Portland
Cement (OPC), Portland Pozzolana Cement (PPC) and Portland Slag Cement
(PSC) constitute the major shares accounting for almost 99% in total production.
Ordinary Portland cement is most commonly used in India. It holds a share of about
70% in total production. PPC production accounts for about 18% of total cement
production while PSC assumes a share of only 11%. Generally, the two varieties,
PSC and OPC, can be used for same purposes, while PPC cannot be used for
prestressed and high strength concrete, as used in bridges and airports.

Primary energy consumption in a typical dry process Portland Cement Plant as


found in industrialized countries consists of up to 75% of fossil fuel consumption and
up to 25% of electricity consumption. Within the fuel category Pyroprocessing
requires the most energy, consuming 99% of the fuel energy while electricity is
mainly used to operate both raw material (33%) and clinker (38%) crushing and
grinding equipment. In addition, electricity is needed for Pyroprocessing (22%)
making it by far the most energy intensive step of the production process. India’s
cement units are generally less energy efficient using both more thermal and
electrical energy. However, the shares of energy used within the different sections of
production are about the same.

About 94% of the thermal energy requirement in the Indian cement manufacturing is
met by coal. The remaining part is met by fuel oil and high speed diesel oil. So far,
no real substitute for coal exists. Increasing the oil share would imply significant
Outflows of foreign exchange and impose a burden on the economy. Natural gas is
mainly used as feedstock in newly-built large fertilizer plants and is thus not
sufficiently available for the cement industry.

Actual coal consumption varies with qualitative factors. Over the years there has
been a steady decline in the quality of coal. In particular, the ash content of coal has
increased implying lower calorific values of coal, and improper and inefficient

Study on Positioning of PPC And PSC Cement 39


burning, ash ring formation in the kiln etc. Coal consumption thus had to be
increased to provide the energy needed for clinker production resulting in additional
costs for transportation, handling, grinding and burning of coal. In order to reduce
these problems the cement industry started implementing coal washeries which
reduce the ash content of coal at the mine itself.
Generally, power is provided by the State Electricity Boards. Yet, problems in power
Supply, such as frequent power cuts, power failures and low voltage, impose
immense problems on the cement industry. Interruption of power affects the industry
negatively by causing production losses and low capacity utilization, idle running of
equipment during stop and restart of the plant, thermal losses during reheating,
damages to refractory etc.Cement companies have therefore started installing
captive power to ensure continuous running of process plants and emergency
equipment.

Study on Positioning of PPC And PSC Cement 40


RESEARCH
METHODOL
OGY

It’s imperative that any type of organisation in the present environment needs
Systematic supply of information coupled with tool of analysis of for making sound
Decision which involves minimum risk.
A research design is purely and simply the framework or plan for a study that guides

Study on Positioning of PPC And PSC Cement 41


The collection and analysis of the data.

METHODS OF DATA COLLECTION

 Through interaction with retailers.


 Through questionnaires filled from the consumer and retailers.

SAMPLE DESIGN

Considering the constraints, it was decided to conduct the study based on sample
size of 100 respondents.
The selection was made through combined approach of random sampling and
Convenient sampling. Scientific method was not adopted in this study because of
Financial constraints and also because of lack of time, also the basic aim of doing
the research was academic, hence most convenient way was selected.

TOOLS USED

There are several methods of collecting primary data, particularly in surveys and
Descriptive research. Important are:-
 Observation method.
 Through questionnaires.
 Interview method.

Study on Positioning of PPC And PSC Cement 42


OBJECTIVE
OF
STUDY

Objectives of my survey are as under:-

1. To know the position of Portland Pozzolana and Portland Slag Cement in the
trade and non-trade segment regarding sale in comparison with the other brands.

2. To know the reasons behind the selection of a particular brand.

Study on Positioning of PPC And PSC Cement 43


3. To get suggestions form the trade and non-trade segment in order to improve the
sale as well as level of satisfaction in them.

To attain the above objectives various other sub objectives were needed to be
achieved. These are listed below:

 To analyze the market share of Birla Gold Cement.

 To know the customers preference for the brands of cement.

 To know the preference of retailer for sorting different brands of cement.

 To understand the effectiveness of various sales promotion activities of cement.

 To know preference of retailers for different gift and incentives.

 To analyze the sales promotion activities of various brands.

 To analyze the transportation facilities for Birla Gold and other cement companies.

 To analyze the frequency of visits of marketing representative of various


companies.

Thus my study attempts to find ways to increase market share, to increase customer
satisfaction and thus increase the business prospects.

Apart from it’s also focus upon the growing business opportunities and widening
scope of cement industry and relevant industries like power plants and
manufacturing units to supply and give manufacturing support to cement industry.

Study on Positioning of PPC And PSC Cement 44


OBSERVATI
ON &
ANALYSIS

Results

The survey is conducted in RAIPUR and its nearby locations. Total number of respondent
covered under this survey is 50 which are either customers or retailers.
In RAIPUR mainly companies playing in the market are BIRLA, ACC, AMBUJA,
LAFARGE, JP Cements. Lafarge is toughest competitor of Birla cement.

Study on Positioning of PPC And PSC Cement 45


As we know that Chhattisgarh is arising market and real estate business is at its best so all
companies are doing aggressive marketing and are trying their level best to get their
customers allotting discount on purchasing in lot providing good margin to local retailers and
distributers to reap the stock out of storage and to push the sales.

The following are companies’ main brand in Raipur market.

COMPANY MAIN BRAND Market price Market Share


BIRLA GOLD & A1 255 & 240 Rs 20%
ACC SURAKSHA 252 Rs 16%
JAYPEE BULAND 240 Rs 13%
AMBUJA FAULAD 248 Rs 14%
LAFARGE CONCRETO 252 Rs 18%
Ultratech BIRLA PLUS 254 Rs 14%
Others ------“>>>>> >>>>-------------- 05%

In the above given estimated table we can see that Birla is market leader and
Lafarge is the closest competitor and every company has got good customer base
and are trying to increase their net customer base so it helps us to say that Birla,
Lafarege, ACC and Ultratech are delivering superior quality product and others still
going through transformation process.

LEADING COMPANY As Per The Survey Conducted

COMPANY RESPONDENTS IN FAVOUR

ACC 25

BIRLA 20

Study on Positioning of PPC And PSC Cement 46


JP Cements 18

LAFAREGE 09

AMBUJA 28

Cementing the future Har nirmaan ki jaan

Study on Positioning of PPC And PSC Cement 47


Majboot har pal Engineers ki pehli pasand.

Vishwas se kare nirmaan. Buland Bharat ka buland cement.

Chtaan sa majboot khare sone ki quality.

Bibliography

To make a study or to prepare a research report we have to have take the help of
knowledgeable stuffs and that here we can say intellectual and quicker sites are
fulfilling our requirements and information required to prepare the seminar report.

Major Contributors for my report are several websites and web links mentioned
below:-

www.google/search/portland
Study on Positioning of PPC And PSC Cement 48
www.wikipedia.org

www.cement.org

www.business.mapsofindia.com

www.acclimited.com

www.ibef.org/industry/cement

www.birlacement.com

www.slagcement.org

www.lafarge-india.com

www.answers.com

Dear Sir/Madam

I most humbly request you to please respond to my certain questions which will help me to depict
conclusion for study conducted by me on topic entitled...

”Study on Brand Switching in Consumer Products”

I sincerely assure you about keeping your valuable opinions and relevant information provided by
you will be kept confidential and safe.

Further I will appreciate your cooperation and help to let me complete my respective report.

Name of the Respondent……………………………………………………………………………………………………………

Age (Yrs)………………. Gender Male Female

Occupation ………………………………………………………………………………………………………………………………..

Study on Positioning of PPC And PSC Cement 49


Contact Number ………………………………………………………………………………………………………………………..

Address ……………………………………………………………………………………………………………………………………..

Que 1. What colour arises in your mind when it comes to Cement?

White Black

Que2. Which Brand of Cement you Prefers while purchasing Cement?

Birla Ultratech ACC

Ambuja J P Cement Lafarge

Que3. What you keep in your mind before purchasing the cement?

Brand Name Product Differentiation

Pricing Ad Influences

Que4. Which Brand of cement you would like to purchase if you get the privilege to do so?

Ultratech Birla White Lafarge

Ambuja JP Cement ACC

Que5. Which Cement Brands price is reasonable according to you?

Ultratech Birla White Lafarge

Ambuja JP Cement ACC

Que6. Which brands product is more solid and durable according to you?

Ultratech Birla White Lafarge

Study on Positioning of PPC And PSC Cement 50


Ambuja JP Cement ACC

Que7. If you know about the classification of cements then which one Porland Pozzolana or Portland
Slag Cement is better?

Ultratech Birla White Lafarge

Ambuja Binani Cement ACC

Study on Positioning of PPC And PSC Cement 51

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