Your Directors have pleasure in presenting their 66th Annual Report and the Audited Accounts of the Company for the year ended 31st March 2024.
Rs. in crores
| Separate Financial Statements | 31-03-2024 | 31-03-2023 |
| Total Income | 9,392.17 | 8,171.97 |
| Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) | 1,594.87 | 1,218.65 |
| Less: Interest | 415.53 | 240.52 |
| Profit Before Depreciation & Tax (PBDT) | 1,179.34 | 978.13 |
| Less: Depreciation | 635.87 | 504.44 |
| Profit Before Tax (PBT) | 543.47 | 473.69 |
| Less: Tax Expenses | ||
| Current Tax | 42.78 | 24.37 |
| Current Tax adjustment of earlier years | (1.86) | 1.31 |
| Deferred Tax | 110.53 | 105.20 |
| Deferred Tax adjustment of earlier years | (2.96) | (0.73) |
| Profit After Tax (PAT) | 394.98 | 343.54 |
| Other Comprehensive Income [Net of tax credit of Rs.2.69 crores (PY: Rs.1.48 crores)] | 2.92 | (3.91) |
| Total Comprehensive Income (TCI) | 397.90 | 339.63 |
Capital and Debt Structure
The paid-up capital of the Company is Rs.23,62,92,380/- consisting of 23,62,92,380 shares of Rs. 1/- each. There has been no change in the Capital Structure of the Company during the year under review.
The Company does not have any Scheme for issue of sweat equity to the employees or Directors of the Company.
The details of Employees Stock Option Schemes (ESOS) are provided in this Report.
The details of Secured Redeemable Non-Convertible Debentures issued during the year under review are given below:
| (a) | Name of the Series | 780% Series - L | 780% Series - M | 780% Series - N |
| (b) | Date of issue of the securities | 11-03-2024 | 11-03-2024 | 11-03-2024 |
| (c) | Date of allotment of the securities | 12-03-2024 | 12-03-2024 | 12-03-2024 |
| (d) | Number of securities | 15,000 | 15,000 | 20,000 |
| (e) | Type of issue | Private Placement | Private Placement | Private Placement |
| (f) | Details of the debt restructuring pursuant to which the securities are issued | Not applicable | Not applicable | Not applicable |
| (g) | Issue price - per instrument | Rs.1.00 lakh | Rs.1.00 lakh | Rs.1.00 lakh |
| (h) | Coupon rate | 780% | 780% | 780% |
| (i) | Maturity date | 12-09-2028 | 12-12-2028 | 12-03-2029 |
| (j) | Amount raised | Rs.150.00 crores | Rs.150.00 crores | Rs.200.00 crores |
There are no deviations in the use of proceeds from the objects stated in the Offer Document issuing such debentures.
Dividend
Your Directors have pleasure in recommending a dividend of Rs.2.50 per share [PY: Rs.2/- per share] on the equity capital of the Company. This would entail an outflow of Rs.59.13 crores with a pay-out ratio of 14.97% of Companys consolidated post tax profit. As per the Dividend Distribution Policy of the Company, the Company should strive to distribute at least 10% of consolidated post tax profit as dividend.
The payment of dividend is in accordance with the "Dividend Distribution Policy" of the Company. The Policy is available on the website of the Company under the weblink:
https://www.ramcocements.in/investors/codes-and-policies
The Dividend Distribution Policy forms part of this Report.
Transfer to General Reserves
After appropriations, a sum of Rs.200 crores has been kept as retained earnings of the Company and a sum of Rs.375.07 crores has been transferred to General Reserve. As on 31-032024, the General Reserve stands at Rs.6,887.32 crores.
Taxation
The Company has made current tax provision of Rs.45.74 crores (PY: Rs.22.89 crores), out of which Rs.2.96 crores is recognised in Other Comprehensive Income (OCI). [PY: Rs.(1.48) crores].
Current tax adjustments of earlier years is Rs.(1.86) crores as against Rs.1.31 crores during the previous year.
The deferred tax for the year ended 31-03-2024 is Rs.104.88 crores (PY: Rs.105.20 crores), out of which, deferred tax of Rs.(5.65) crores is recognised in OCI (PY: Nil).
Deferred tax credit adjustments pertaining to earlier years, for the year ended 31-03-2024 is Rs.2.96 crores as against Rs.0.73 crores during the previous year.
Management Discussion & Analysis
Macro-Economic Review Global Economy
In 2023, the global economy exhibited strong resilience amidst an uncertain environment with geopolitical tensions and global energy crisis with multiple sanctions. The global economy expanded steadily driven by positive supply trends despite central banks raising interest rates to stabilise prices. The global economy grew by 3.2% in 2023, with a similar pace expected in 2024 and 2025.
Advanced Economy
Steady employment growth and a pick-up in consumer confidence despite continued monetary tightening by major central banks aided the growth of advanced economies.
Growth in advanced economies is expected to improve slightly from 1.6% in 2023 to 1.7% in 2024 and 1.8% in 2025.
Emerging Markets and Developing Economies
The emerging markets and developing economies (EMDE) grew by 4.3% in 2023 and is expected to maintain a steady growth of 4.2% in both 2024 and 2025. EMDEs continue to face pressure from high public debt and unstable inflation rates. Global growth though resilient faces the risk from rising interest rates and new price spikes due to geopolitical conflicts like the Russia-Ukraine war, the Red Sea crisis and the Israel-Palestine conflict. Multilateral cooperation will help limit the costs and risks of geoeconomic fragmentation and climate change, speed the transition to green energy, and facilitate debt restructuring.
(Source: World Economic Outlook-IMF, April 2024)
Indian Economy
Amidst challenging global economic scenario, India continued to be the fastest growing major economy. India exhibited strong resilience in 2023-24, primarily driven by government push for infrastructure, digitalisation, ease of doing business, inclusive growth and improved quality of fiscal spending. India rose to fifth place in the global investment destination ranking in 2024 as compared to ninth position it held in 2023, according to PwC CEOs survey. Domestic credit issuance to the commercial sector has also shown substantial growth.
According to Second Advanced estimates by National Statistics Organisation (NSO), the growth of the economy is estimated at 7.6% in 2023-24, higher than the 7% growth seen in 2022-23. This acceleration in growth is aided by increased investment, consumption growth, improved business sentiments and the financial positions of banks and corporations. Inflation is expected to be controlled and remain within RBIs target as food prices normalize and government measures like banning exports, increase the supply of key commodities.
According to World Bank estimates, the Indian economy will grow at 7.5% in FY25 mainly led by activity in services and industry, rapid increase in investment and government consumption. Financial conditions in India have remained accommodative amidst global challenges.
(Source: NSO, World bank)
Cement Industry Review
The Indian cement industry is the one of the largest globally only second to China. India comprises ~8% of the total installed capacity. In 2023-24, cement manufacturers added 43 million tonne (MT) capacity, the highest in the past 12 years, taking the total installed capacity to beyond 630 MT per annum (MTPA). For the first time in the past decade, cement utilisation levels crossed the 70% mark in 2023-24 to touch 72%.
The demand for cement industry has been steadily growing in the recent years. In FY24, the cement demand in India, is estimated to have grown by 8 to 9% y-o-y. Volume-driven growth is witnessed primarily led by housing demand, multiple infrastructure projects for construction of roads, expressways, airports, metro rail, and strong uptick in rural demand led by the Pradhan Mantri Awas Yojna - Gramin. In Tamil Nadu and Andhra Pradesh, the cement demand was affected due to heavy rain and cyclones in the third quarter of 2023-24.
The cement prices were subdued during the year under review, due to intensified competition among industry players across various regions.
(Source: CARE, CRISIL)
Growth drivers
• Bharatmala project: The Government has set a target to lay down 60,000 kms of road with a total outlay of Rs. 6.9 lakh crores out of which 34,800 kms are targeted in Phase-I. Till December 2023, road projects spanning 15,549 kms have been built under Phase-I.
• Metro expansion: Around 874 kms of metro rail is operational in 20 cities and about 980 kms is under construction.
• Infrastructure push: The Governments thrust on infrastructure under the National Infrastructure Pipeline (NIP), along with individual State Governments efforts to increase capex will drive healthy infrastructure-led demand growth in the medium term.
•I IGrowing in residential real estate: The Indian residential real estate sales touched newer heights in 2023, with a total of 4.1 lakh units, up 33% y-o-y. The strong momentum of 2023 is expected to continue with the uptrend in 2024 led by the prevailing sentiment of home ownership. Stable/reduction in interest rate as inflation remains under control, and escalation in property prices signal healthy growth in the residential segment.
• Rising in office space demand: The Office segment saw steady improvement in 2023 with the top 8 cities registering transaction volume of 59.6 million sq. ft. It is expected that driven by the growth in artificial intelligence, data science etc., the tech sector will drive the demand for office space.
• Expanding in commercial and hospitality segments:
2023 saw strong growth in retail, logistic and warehouse segment of real estate with retail leasing touching 4.2 million sq. ft and prominent mall completions. With the growth in tourism, especially spiritual tourism, the hospitality segment of real estate is witnessing good traction with big brands looking to launch new projects in tier II cities which remain currently less explored.
• Lowest per capita cement consumption: Indias per capita cement consumption at 216 kg remains well below the global average of 525 kg. With governments strong push for infrastructure development and housing for all, this gap is expected to be bridged in the near future presenting humongous growth opportunities for the cement sector.
Company Review Cement Division
The Division has sold 180.89 lakh tons of cement during the year compared to 148.21 lakh tons in the previous year, registering a y-o-y growth of 22%. The revenue including scrap sales and other operating income from this division for the current year is Rs.9,140.69 crores (net of applicable taxes) compared to Rs.7,937.27 crores (net of applicable taxes) during the previous year, showing an increase of 15%.
Out of the above, the Companys cement exports accounts for 0.99 lakh tons for a value of Rs.51.23 crores as against 0.67 lakh tons for a value of Rs.32.68 crores during the previous year.
Dry Mortar Division
The Division has sold 3.07 lakh tons of Dry Mortar products accounting for a revenue of Rs.194.37 crores (net of applicable taxes) during the year as against 2.03 lakh tons of Dry Mortar products accounting for a revenue of Rs.135.42 crores (net of applicable taxes) during the previous year.
Out of the above, the Companys dry mortar exports accounted for 89 tons for a value of Rs.0.10 crores as against 123 tons for a value of Rs.0.14 crores during the previous year.
Ready Mix Concrete Division
The Division has sold 21,914 cu.m. of concrete during the year, accounting for a revenue of Rs.12.03 crores (net of applicable taxes) compared to 26,983 cu.m. of concrete accounting for a revenue of Rs.14.45 crores (net of applicable taxes) during the previous year.
Wind Farm Division
The Division has generated 2,117 lakh units as compared to 2,233 lakh units in the previous year. Out of this, 2,050 lakh units were generated from the wind farms in Tamil Nadu and 67 lakh units from the wind farms in Karnataka. Out of the units generated in Tamil Nadu, 1,975 lakh units were meant for adjustment against the power consumed in our plants and balance 75 lakh units were sold to Tamil Nadu Generation and Distribution Corporation Limited (TANGEDCO) for a value of Rs.2.71 crores. From June 2023, the existing energy purchase agreements have been converted into energy wheeling agreements, for the purpose of captive consumption. Including previous balances, a sum of Rs.54.34 crores was outstanding from TANGEDCO as on 31st March 2024.
The 67 lakh units generated during the year under review in Karnataka have been banked with Bangalore Electricity Supply Company Limited (BESCOM) and out of this 66 lakh units have been adjusted during the year. The balance 1 lakh units will be adjusted against the power consumed in our plant in subsequent periods.
77 lakh units generated in the year 2021-22, remained unbilled.
The income during the year from the Division was Rs.2.74 crores compared to Rs.48.13 crores in 2022-23.
Divestment of holdings held in Lynks Logistics Limited
During the year under review, the Company had sold its entire shareholding of 49,95,16,202 equity shares held in Lynks Logistics Limited (Lynks) to Bundl Technologies Private Limited ("Bundl", operating under the brand name "Swiggy") and simultaneously acquired 24,07,244 Compulsory Convertible Preference Shares (CCPS) of Bundl, in consideration of the sale of shares. The Share Subscription and Purchase Agreement was entered into on 12-07-2023 and the transaction was completed on 29-08-2023. Hence, the Company ceased to be an Associate Company.
Other Income
Other income during the year was Rs.42.34 crores compared to Rs.36.70 crores in 2022-23.
Net Revenue
The net revenue for the company for current year is Rs.9,392.17 crores (net of applicable taxes) compared to Rs.8,171.97 crores (net of applicable taxes) during the previous year, showing an increase of 15%. The companys net revenue has crossed the Novem milia crores mark for the first time.
Power Plants
The Companys thermal power plants aggregating to a capacity of 175 MW are located at its cement manufacturing plants. The thermal power plants act as source for captive power for the Company, and the power generated from the thermal power plants are used for self-consumption in cement manufacturing.
Capital Expenditure Programmes - New Projects
The status of the projects is given below.
Cement Plants Kolimigundla
The Kolimigundla unit commissioned in the year 2022-23, had achieved its rated output. During the year under review, the company had identified scope for increasing the clinkerisation capacity. By carrying out de-bottlenecking measures, the clinkerisation capacity was increased from 2.50 Million
Tonnes Per Annum (MTPA) to 3.15 MTPA during the third quarter of 2023-24.
The 3rd phase of Waste Heat Recovery System (WHRS) of 3.15 MW capacity was commissioned in August 2023. With this, the aggregate capacity of WHRS at Kolimigundla plant had increased to 12.15 MW.
The thermal power plant of 18 MW capacity is expected to be commissioned in 2024-25 as against 2023-24 as informed in the Boards Report for the year ended 31st March 2023.
At the Boards Report for the year ended 31st March 2023, it was informed that the railway siding would be commissioned in 2023-24. During the execution of the project, it was decided to install additional siding line from the main line, to enable flexibility in the operation. Also, as per the local requirements, additional bridges, underpasses and culverts had been constructed. Because of the above, there had been a delay in completion of the project and is expected to be commissioned during 2024-25.
Increase in cost
The Company had continued to build-up common infrastructure such as clinker silos, cement silos, lorry loading and wagon loading systems, coal shed for thermal power plant, limestone shed, hoppers, etc. which would be useful for both Line I and Line II and for future expansion at the plant.
Because of creating additional infrastructure facilities, improvements in the railway siding front and increase in interest and pre-operative expenses, the cost of installation of Line I at Kolimigundla had increased from Rs.3,000 crores to Rs.3,500 crores.
Establishment of Line II
Considering the demand for cement and successful operation of Line I, it was decided to expand the capacity of Kolimigundla plant by establishing Line II. It is proposed to install a Kiln of 7,500 tonnes per day capacity, which is similar to the one installed in Line I. The second line will have the following capacities:
| Clinkerisation Capacity | 3.15 MTPA |
| Cement Grinding Capacity | 1.50 MTPA |
| WHRS | 15.00 MW |
The cost of establishment of Line II is estimated at Rs.1,250 crores. The project is expected to be commissioned in 2025-26.
Ramasamy Raja Nagar
The limestone benefication plant at the Pandalgudi Mines had been commissioned in June 2023, as against July 2023 as informed at the Boards Report for the year ended
31st March 2023. The aggregate project cost for modernisation of the Ramasamy Raja Nagar plant involving establishment of Line III and limestone benefication plant at Pandalgudi Mines has increased from Rs.817 crores to Rs.849 crores. The project has helped to achieve better power and fuel efficiencies besides reduction in fugitive dust emissions and carbon emissions.
The company is in the process of establishing a WHRS of 10 MW capacity to be commissioned by March 2025.
Ariyalur
At the Ariyalur plant, the Company had made de-bottlenecking of the Pyro processing system in both Line 1 and Line 2 Kilns. The de-bottlenecking enhanced the combined clinkerisation capacity by 1000 TPD. This amounted to annual clinker production increase of 0.35 MTPA. The de-bottlenecking activities included design, engineering and execution which were carried out by the Companys in-house team. The clinkerisation capacity of the Ariyalur plant had increased from 3.27 MTPA to 3.62 MTPA.
Odisha Grinding Unit
As informed at the Boards Report for the year ended 31st March 2023, the Company had established Line II at its Odisha Grinding Unit with a capacity of 0.90 MTPA and the same had been commissioned in March 2024. The cost of the project was Rs.130 crores.
Budawada Mines
During the year under review, the Company had commissioned infrastructure facilities for transportation of limestone from
Budawada Mines to its Jayanthipuram Plant, at a cost of Rs.250 crores. The project was inaugurated by the Honourable Prime Minister, Shri.Narendra Modi on 12th March 2024 under the Gati Shakti Mission.
Dry Mortar Plants
At the Boards Report for the year ended 31st March 2023, it was informed that the new dry mortar plants at Jayanthipuram and Haridaspur were expected to be commissioned in 2023-24. The plant at Jayanthipuram has become ready for commissioning. The plant at Haridaspur is expected to be commissioned during September 2024.
Acquisition of Mining Lands
During the year under review, the Company had identified and acquired limestone bearing lands in Nandyal District, Andhra Pradesh, owned by Prism Johnson Limited (‘Prism). The area so acquired is 1,393.26 acres, located in the villages of Kotapadu and Kalavatla, Kolimigundla Mandal, Nandyal District, Andhra Pradesh. The Company has also got the mining lease transferred in its name from Prism.
With regard to the E-Auction conducted for the Bommanalli Limestone Block in Karnataka, the Company has been declared as the Preferred Bidder, by Department of Mines and Geology, Government of Karnataka. The Company has acquired 657 acres of land and further acquisition is in progress.
During the year under review, the Company had incurred Rs.1,922.38 crores towards capital expenditure.
Financial Performance
Analysis of the Statement of Profit and Loss - Separate Financials
The summary of key components of the Statement of Profit and Loss for the financial year 2023-24 is detailed below:
| Particulars | 2023-24 | 2022-23 | Variance | |
| Rs. in crores | Rs. in crores | Rs. in crores | % | |
| Revenue | ||||
| Sale of Products | 9,319.53 | 8,052.28 | 1,26725 | 16 |
| Income from Wind power | 2.74 | 48.13 | -45.39 | -94 |
| Other Operating revenue | 2756 | 34.86 | -730 | -21 |
| Other Income | 42.34 | 36.70 | 5.64 | 15 |
| Total Revenue | 9,392.17 | 8,171.97 | 1,220.20 | 15 |
| Operational Expenses | ||||
| Cost of material consumed | 1,745.18 | 1,35707 | 388.11 | 29 |
| Change in inventories of finished goods & WIP | -2713 | -14.10 | -13.03 | - |
| Employee Benefits Expenses | 526.81 | 460.52 | 66.29 | 14 |
| Transportation and Handling | 1,953.38 | 1,602.98 | 350.40 | 22 |
| Power and Fuel | 2,554.89 | 2,661.60 | -106.71 | -4 |
| Other Expenses, net of self-consumption | 1,044.17 | 885.25 | 158.92 | 18 |
| Total Operational Expenses | 779730 | 6,953.32 | 843.98 | 12 |
| EBITDA | 1,594.87 | 1,218.65 | 376.22 | 31 |
| Depreciation & Amortization Expense | 635.87 | 504.44 | 131.43 | 26 |
| Finance Costs | 415.53 | 240.52 | 175.01 | 73 |
| Profit Before Tax | 543.47 | 473.69 | 69.78 | 15 |
| Tax Expenses | 148.49 | 130.15 | 18.34 | 14 |
| Profit After Tax | 394.98 | 343.54 | 51.44 | 15 |
| Other Comprehensive Income | 2.92 | (-)3.91 | 6.83 | - |
| Total Comprehensive Income | 39790 | 339.63 | 58.27 | 17 |
Revenue
The company has achieved a milestone of surpassing 9,000 crores in total revenue. Cement sales, inclusive of dry mix, increased to 18.40 MT from the previous years 15.02 MT, registering an industry leading volume growth of 22% during FY24. However, amidst this growth, there was a 6% decrease in the average net realizable sale price of cement due to constant pressure on cement prices across all regions. Despite the price pressure, the share of premium products increased to 28% in FY24 as against 26% in FY23 highlighting the effectiveness of companys strategy of right cement for right applications. This continued emphasis further helped to strengthen the companys brand in the market.
Wind power revenue has decreased due to transition from ‘Sale to Board to ‘Captive use of wind power. Out of 21.17 crores units generated during FY24, 20.42 crores units were captively consumed.
Other Operating income witnessed a decrease mainly due to reduction in grant income from Rs.15.27 crores to Rs.2.48 crores, which was offset by increase in other income attributed to increase in interest income, profit on sale of PPE (Property, Plant and Equipment) and other non-operating income.
Cost of materials consumed
During the year, cost of materials consumed in FY24 has increased by 29% compared to FY23. The main reason for increase is primarily attributed to higher clinker production by 18% and cement production by 22% during the year. Additionally, an increased inter-unit movement of clinker to grinding plants by 11% during the year has led to cost increase. Moreover, the levy of busy season surcharge by railways for the extended period during FY24 has impacted the cost of inward movements when compared to FY23. In addition, cost of materials consumed for FY24 also reflect inflationary impact on prices of other raw materials viz. Fly ash, Slag, Gypsum and other additives.
As a % of revenue, cost of materials consumed for the year under review accounted for 18.58% in FY24 as against 16.61% in FY23.
Changes in inventories of finished goods / work-inprogress
The increase in inventories of finished goods / work-in-progress was mainly due to increase in process inventory including clinker.
Employee Benefits Expenses
The employee cost for the year increased by 14%. This increase was mainly driven by increments in annual salaries and a rise in head count from 3,507 as at 31st March 2023 to 3,647 as at 31st March 2024. During FY24, employee cost of Rs.0.52 crores was capitalized as directly attributable expenditure for the construction of plant and equipment as against Rs.21.12 crores in FY23. The absorption of employee benefits expenses was better in view of improved operating leverage.
As a % of revenue, the employee cost for the year under review stood at 5.61% in FY24 as against 5.64% in FY23.
Transportation and Handling expenses
During the year, Transportation and Handling expenses for FY24 increased by 22% compared to FY23 mainly due to sale volume growth of 22%. The reduction in diesel price of 1% and the reduction in lead distance by 18 KMs in FY24 were offset by levy of busy season surcharge at 15% on rail freight for the extended period, which has pushed up the overall transportation cost marginally. The rail co-efficient in FY24 is 8% as against 11% during FY23. There has been an increase in handling expenses due to general increase of labour cost pertaining to cement handling.
As a % of revenue, transportation and handling expenses for the year under review remains at 20.80% in FY24 as against 19.62% in FY23.
Power and Fuel
During the year, power and fuel cost for FY24 have decreased by 4% compared to FY23 in view of lower fuel price compared to its peak level fuel price in FY23, despite increase in clinker production by 18% and increase in cement production by 22%. The blended fuel consumption per ton of material have come down from $177 in FY23 to $149 in FY24.The rupee depreciation by 3% during FY24 also impacted the fuel cost.
The Company uses both pet coke / coal for kiln operations depending upon cost per Kcal of the respective fuel. The blended cost per Kcal for FY24 was Rs.1.75 as against Rs.2.20 during FY23. The pet coke usage was 52% in FY24 as against 55% in FY23, and coal usage was 42% in FY24 as against 32% in FY23.
The power generation from WHRS with a capacity of 43 MW has led to significant reduction in the overall power cost. During FY24, around 96% of power generated from windmills were captively consumed as against 30% in FY23. The Companys strategy of transition of wind power capacity from ‘Sale to Board to ‘Captive use during the year has helped to reduce the power cost besides reducing the carbon footprint significantly. During FY24, 42% (PY: 56%) of the total power requirements were met from captive thermal power plants, 24% (PY:22%) from electricity grids and 34% (PY: 22%) from Green Power viz. wind power, and WHRS.
The power & fuel cost has decreased by Rs.382 per ton of cement during the year. Power and fuel cost accounted for 2720% of revenue in FY24 as against 32.57% in FY23.
Other expenses
Other expenses increased by Rs.158.92 crores i.e by 18%. The packing material expenses has increased by Rs. 16.29 crores due to increase in sale volume by 22%. Insurance, R & M, Stores & Spares, Rates & Taxes, Outsourcing cost and Security charges increased by Rs.66.12 crores due to commissioning of additional manufacturing locations in RRN Line III, Kolimigundala and Dry Mortar Plants. However, this was offset by decrease in other administrative expense cost by Rs.4.98 crores due to lower travel expenses in FY24.
During the year, the Advertisement / sales promotion expenses have increased by Rs.32.27 crores due to increased intensity of brand building measures. Selling Agents Commission and Other Selling Expenses have increased by Rs.33.72 crores because of increase in B2B volume.
The company has made political contribution for Rs.35 crores in FY24 as against Rs.20.50 crores in FY23. The political contributions made, were within the limits specified under Companies Act, 2013.
Other expenses accounted for 11.12% of the revenue in FY24 as against 10.83 % in FY23.
Depreciation & Amortization
Depreciation and Amortization has increased from Rs.504.44 crores in FY23 to Rs.635.87 crores in FY24. The reason for increase is due to depreciation arising out of commissioning of integrated plant at Kolimigundala, R R Nagar Line III, Dry Mortar Plants at Salem and R R Nagar. Besides, Amortization of Mine development under Intangible Assets has increased by Rs.35.21 crores due to increase in clinker production by 18% and Amortization of Mining Rights increased by Rs.4.49 crores due to acquisition of mining lands from prism cements.
Depreciation & Amortization accounted for 6.77% of revenue in FY24 as against 6.17% in FY23.
Finance Costs
Finance costs have increased by 73% from Rs.240.52 crores in FY23 to Rs.415.53 crores in FY24 due to increased quantum of borrowings. Besides, interest rates have also increased due to repo rate hike by 250 bps. The effective rate of borrowings for FY24 stood at 770 % as against 6.35 % in FY23. The total borrowings as at 31st March 2024 has increased by Rs.425.77 crores and stood at Rs.4,916.82 crores. The Net Debt to EBITDA stood at 3.02 times in FY24 as against 3.57 times in FY23.
The interest coverage ratio decreased from 2.06 times in FY23 to 1.94 times in FY24, due to increased interest commitments for FY24. The Gross interest on the borrowings for FY24 was Rs.493.77 crores as against Rs.346.44 crores in FY23. Out of which, Rs.78.24 crores (PY: Rs.105.92 crores) was capitalised as part of eligible qualifying assets.
Finance costs accounted for 4.42% of the revenue in FY24 as against 2.94% in FY23.
Tax Expenses
The overall effective tax rate has increased from 2735% to 2770% due to increase in ineligible expenditure viz. donation / CSR amounting to Rs.64.44 crores in FY24 as against Rs.43.36 crores in FY23.
Current tax credit and deferred tax credit relating to earlier years was Rs.1.86 crores and Rs.2.96 crores respectively.
Overall Tax expenses accounted for 1.58% of the revenue in FY24 as against 1.59% in FY23.
Other Comprehensive Income (OCI)
Other comprehensive income include loss arising out of re-measurement of defined benefit plans, net of taxes amounting to Rs.5.76 crores, which is due to increase in salary escalation rate assumption and decrease in discount rate during the year.
Gain on sale of equity investments viz. Lynks Logistics Limited & HDFC Limited amounting to Rs.32.63 crores offset by fair value loss on investments in APGPCL & Bundl Technologies Private Limited amounting to Rs.24.70 crores along with net tax credit of Rs.0.75 crores, is also recognised under OCI, during the year.
Profitability
EBIDTA increased by 31% from Rs.1,218.65 crores in FY23 to Rs.1,594.87 crores in FY24 due to softened fuel prices amid constant pressure in cement sale prices while the average cement price for FY24 has decreased by 6%, when compared to FY23. The EBITDA margin for FY24 stood at 17% as against 15% in FY23. Blended EBITDA per ton for FY24 have increased by 7% from Rs.811 per ton in FY23 to Rs.867 per ton in FY24.
Profit before tax (PBT) for FY24 is Rs.543.47 as against Rs.473.69 crores in FY23, with a growth of 15%. Profit after Tax (PAT) is also up by 15% from Rs.343.54 crores in FY23 to Rs.394.98 crores in FY24. The PAT margin stood at 4% for both FY24 & FY23.
Financial Position
Analysis of the Balance Sheet - Separate Financials
The summary of the financial position as at 31-03-2024 is detailed below:
| Particulars | 2023-24 | 2022-23 | Variance | |
| Rs. in crores | Rs. in crores | Rs. in crores | % | |
| Assets | ||||
| Non-current Assets | 13,923.74 | 12,629.50 | 1,294.24 | 10 |
| Current Assets | 2,244.61 | 1,88739 | 35722 | 19 |
| Total Assets | 16,168.35 | 14,516.89 | 1,651.46 | 11 |
| Equity & Liabilities | ||||
| Equity | 7144.12 | 6,793.53 | 350.59 | 5 |
| Non-current liabilities | 5,060.32 | 4,639.67 | 420.65 | 9 |
| Current liabilities | 3,963.91 | 3,083.69 | 880.22 | 29 |
| Total Equity and Liabilities | 16,168.35 | 14,516.89 | 1,651.46 | 11 |
Non-current Assets
Non-current assets have increased by Rs.1,294.24 crores due
to the following reasons:
(a) The company incurred a capital expenditure of Rs.1,922.38 crores towards capacity expansion at Kolimigundala, acquisition of mining land and Dry Mortar plants besides regular capital expenditure. This is after adjusting non-cash adjustments / accruals viz. Depreciation of Rs.635.87 crores (including capitalisation of depreciation of Rs.0.01 crores), decrease in capital payables of Rs.3720 crores and other non-cash adjustments of Rs.3 crores. Besides the Company has derecognised WDV value of Rs.4.42 crores towards sale of asset during the year.
(b) The company has acquired equity shares of Associate viz. Ramco Industries Limited, at a market value of Rs.15.50 crores. Further, the Company has sold investments viz. equity shares in HDFC Limited & units in HDFC Mutual Fund, which had the carrying amount of Rs.6.19 Crores as at the beginning of the year. During the year, the Company has also sold and transferred shares held in Lynks Logistics Limited having a carrying value of Rs.49.95 Crores, and simultaneously acquired 24,07,244 Compulsory Convertible Preference Shares (CCPS) of
Bundl Technologies, in consideration of the sale of shares for a value equivalent to Rs.86.15 crores. Subsequently, the Company has recognised fair value loss of Rs.2.58 crores based on fair value measurement, during the year, reducing the carrying value of such investments to Rs.83.57 crores as at the reporting date.
(c) The company has recognised the fair value loss of investment in APGPCL of Rs.22.12 crores in view of material uncertainty on its ability to continue as a going concern.
(d) The loans to subsidiaries, associates and employees have decreased marginally by Rs.1.29 crores due to loan repayments. The said loans carry interest at an arms-length basis in respect of subsidiaries / associates.
(e) Other non-current assets have increased by Rs.26.83 crores mainly due to increase in deposits under protest, in appeals and deposits with government departments.
Current Assets
Current assets increased during the year by Rs.357.22 crores mainly due to the following reasons:
(a) Inventories increased by Rs.99.96 cores mainly due to increase in stores and spares, work in progress and finished goods, however, the inventory turnover ratio decreased from 39 days to 36 days.
(b) Trade receivable increased by Rs.387.19 crores. This is due to increase in sale volume by 22% and increase in the average collection period from 18 days in FY23 to 26 days in FY24.
(c) Decrease in cash and bank balances by Rs.33.41 crores.
(d) Decrease in claims receivable from government / semi-government bodies by Rs.113.04 crores mainly due to realisation of claim from railways under LTTC scheme during FY24, which was outstanding as at FY23.
(e) There was an increase in other current assets to the extent of Rs.16.52 crores mainly due to increase in supplier advances and prepaid expenses.
Equity
(a) There is no change in the equity share capital during the year.
(b) The total comprehensive income for the year is Rs.397.90 crores. The Company has paid dividend for FY23 during FY24 amounting to Rs.47.31 crores. The Companys return on net worth increased from 5% in FY23 to 6% in FY24.
Non-current liabilities
(a) Long-term Borrowings have increased by Rs.305.05 crores to meet the capital expenditure for capacity expansion projects. The debt-equity ratio and net debt / EBITDA stood at 0.69 times and 3.02 times respectively as at 31st March 2024 as against 0.66 times and 3.57 times as at 31st March 2023. Return on capital employed has gone up from 5% in FY23 to 7% in FY24 mainly due to increase in profitability. The increase in Debt-Service Coverage Ratio from 1.31 times in FY23 to 1.85 times in FY24 is mainly due to increase in EBITDA by 31% on account of decrease in power and fuel cost amid constant pressure on cement prices compared to FY23.
(b) Deferred Tax Liabilities increased by Rs. 101.92 crores due to recognition of temporary differences of Rs.104.88 crores and tax credit adjustments of earlier years of Rs.2.96 crores.
(c) Provisions have increased by Rs.16.10 crores due to increase in provision for mines restoration obligation. Other liabilities have decreased by Rs.2.40 crores mainly due to recognition of grant income by Rs.2.48 crores offset by decrease in classification of current portion of deferred government grant by Rs.0.08 crores and lease liability reduction by Rs.0.02 crores in respect of Right-of- Use Asset for non-cancellable leases adjusted for lease payments and interest on liability.
Current liabilities
(a) Short-term Borrowings other than current maturities of long-term borrowings decreased by Rs.165.88 crores
(b) Current maturities of long-term borrowings increased by Rs.290.23 crores, which is due within one year as per repayment schedule.
(c) Security deposits from customers / Customers credit balance have increased by Rs.61.77 crores mainly because of increase in customer deposits offset by decrease in accruals of customer rebates available for adjustment in subsequent periods.
(d) Trade payables increased by Rs.353.70 crores because of negotiation of better credit terms with suppliers and supplier financing facility through reverse factoring arrangement for early payments to suppliers. Consequently, the average payable days has increased from 26 days in FY23 to 32 days in FY24.
(e) Increase in factoring liability by Rs.339.30 crores, being the amount directly remitted by the customers to the Company subsequent to factoring, is disclosed as other financial liabilities, which is payable to the bank on respective due dates as per the terms of factoring arrangement.
(f) Statutory liabilities increased by Rs.28.93 crores mainly due to increased sale volume in the month of March 2024 compared with sale in the month of March 2023.
(g) Provisions increased by Rs.4.03 crores due to increase in provision for compensated absences.
(h) Other liabilities decreased by Rs.31.86 crores mainly due to decrease in payable for capital goods suppliers offset by increase in advance received against sale of immovable property and current tax liabilities.
(i) Current ratio for the year stood at 1.04 times in FY24 as against 1.08 times in FY23.
Cash flows
Analysis of the Cash flows - Separate Financials
The summary of the Cash flows for the year ended 31-03-2024 is given below:
Rs. in Crores
| Particulars | 31-03-2024 | 31-03-2023 |
| Net cash flows from Operating Activities | 1,894.53 | 1,405.00 |
| Net cash flows used in Investing Activities | (1,899.91) | (1,686.93) |
| Net cash flows generated from / (used in) Financing Activities | (28.03) | 274.48 |
| Net decrease in cash & cash equivalents | (33.41) | (7-45) |
Net cash flows from Operating Activities
Net cash flows from Operating activities increased mainly due to increase in operating profitability by Rs.376.22 crores because of lower power and fuel cost and working capital release.
Net cash flows used in Investing Activities
This largely covers the Capex incurred for integrated unit at Kolimigundala, Dry Mortar plants and acquisition of mining lease and lands and other general capex for an amount of Rs.1,922.38 crores, investments in equity shares of an associate of Rs.15.50 crores which was partially offset by loan repayment by subsidiaries and associates for an amount of Rs.6.61 crores, sale of equity investments for Rs.6.67 crores, sale of property, plant and equipment for Rs.8.28 crores and interest, dividend and lease rental receipts of Rs.16.41 crores.
Net cash flows from Financing Activities
Net cash flows from Financing Activities include net proceeds from borrowings for an amount of Rs.425.77 crores and payment of interests / dividend / lease liabilities of Rs.453.80 crores. The borrowings are used for funding capex programs "Movement in Key Financial Ratios" details provided by us.
Movement in Key Financial Ratios
| Particulars | UOM | 31-03-2024 | 31-03-2023 | Variation in % | Formula adopted | What does it signify |
| Debtors Turnover Ratio | Days | 26 | 18 | 44 | 365 Days / (Net Revenue from sale of products / Average Trade Receivables) | It indicates the average collection period and measures the efficiency of the company in managing its accounts receivables |
| Inventory Turnover Ratio | Days | 36 | 39 | -8 | 365 Days / (Net Revenue from sale of products / Average Inventories) | It indicates the average inventory holding period and measures the efficiency with which the company utilizes or managing its inventory |
| Interest Coverage Ratio | Times | 1.94 | 2.06 | -6 | (Profit before Tax + Interest) / (Gross Interest) | It indicates the companys ability in terms of earnings to meet the interest obligations |
| Current Ratio | Times | 1.04 | 1.08 | -4 | Current Assets / (Total Current Liabilities - Security Deposits payable on demand - Current maturities of Long term debt) | It indicates the level of current assets to meet the current liabilities |
| Debt-Equity Ratio | Times | 0.69 | 0.66 | 5 | Total Debt / Total Equity | It indicates the measure to which the Company is financing its operations through debt versus wholly owned funds |
| Operating Profit Margin | % | 17 | 15 | 13 | EBITDA / Net Revenue | It indicates the percentage of profit after all expenses except for interest, depreciation and taxes on the total revenue |
| Net Profit Margin | % | 4 | 4 | Net Profit / Net Revenue | It indicates the percentage of profit after all expenses including interest, depreciation and taxes on the total revenue | |
| Return on Networth | % | 6 | 5 | 20 | Total Comprehensive Income / Average Net worth | It indicates the percentage of return generated to equity shareholders |
| Net Debt / EBITDA | Times | 3.02 | 3.57 | -15 | (Total Debt - Cash and Cash equivalents) / EBITDA | It indicates the relevance of companys operating income to its debt |
| Return on Capital employed | % | 7 | 5 | 40 | (Total Comprehensive Income + Interest) / Average of (Equity + Total Borrowings) | It indicates the percentage of return generated on equity capital and debt capital |
| Price Earnings Ratio | Times | 49 | 52 | -6 | Market Price per share / Earnings per share | It indicates the relevance of the companys share price to the earnings per share. |
| Blended EBITDA per Ton | In Rs. | 867 | 811 | 7 | EBITDA / Sale Volume | It indicates the operating profit per ton of cement and cementitious materials sold |
| Debt Service Coverage Ratio | Times | 1.85 | 1.31 | 41 | (EBITDA - Current Tax) / (Principal repayment excluding repayments towards debt replacement + Gross Interest) | It indicates the availability of operating profit to pay its current maturities of debts and interest obligations |
Reasons for variations in excess of ? 25%
(a) Debt Service Coverage Ratio has increased by 41% mainly due to increase in EBITDA by 31% for FY24.
(b) Debtors turnover ratio has increased by 44% due to increased sale volume in Q4FY24 and consequently, relatively higher credit period offered to customers to attract higher volumes
(c) Return on Capital Employed increased by 40% in view of increase in EBITDA by 31% for FY24.
Human Resources
As we navigate through an ever-evolving business landscape, our greatest asset remains our employees. We have prioritised initiatives that support employee well-being, promote diversity and inclusion, and foster a culture of continuous learning and development. By investing in our people and embracing new technologies, strategies, and dedicated focus on nurturing our people, we are well-positioned to achieve our goals and drive sustainable growth and success in the years to come.
Talent Sourcing
Our success is deeply rooted in the calibre of talent we attract and retain. We have cultivated partnerships with educational institutions and professional organizations. By engaging with talent early in their academic and professional journeys, we have built a talent pipeline to support our growth and expansion. In an increasingly competitive talent market, speed and efficiency are paramount. To streamline our recruitment process and reduce time-to-hire, we have implemented technology-driven solutions to identify and engage candidates effectively.
Performance Management Systems (PMS)
PMS is the framework through which we assess, develop and recognize the contributions of our employees. At the heart of our PMS is the establishment of clear, measurable goals that align with our objectives. Through collaborative goal-setting process, employees and managers work together to define performance expectations and priorities, ensuring alignment with organizational goals and individual aspirations. We will continue to leverage technology, data analytics, and best practices to refine our process, enhance the employee experience, and drive performance excellence across the organization.
Skill Enhancement
At Ramco, we understand that investing in the growth and development of our employees is essential for both individual success and organizational prosperity. All our training needs are captured in the PMS portal during the annual performance appraisal and subsequently, our training calendar is rolled out for the year to impart continuous learning and development programs for the employees. Our system also ensures fair remuneration to all employees and encourages them to demonstrate their full potential
Well-being of employees
Throughout the year, we have implemented a variety of initiatives and programs aimed at empowering our employees to reach their full potential. We have also initiated financial wellness and family counselling programs for their well-being. We will continue to invest in our people, adapt to emerging trends and technologies and strive for excellence in all that we do. As we move forward, we remain steadfast in our commitment to learning and development, ensuring a brighter future for our employees and consequently for the organisation.
Recognition and Reward
Employee recognition is more than just a formality. It is a core part of our culture, reflecting our appreciation for their dedication, hard work and contribution. We will continue to listen to feedback, refine our approaches and explore new ways to recognize and reward the contributions of our diverse workforce by prioritizing employee recognition as a strategic imperative. Additionally, the company values the employees esteemed years of association with Long Service Awards to recognize and create a sense of belongingness. During the year under review, we facilitated 306 employees for their long service in the organisation.
Risk Management Policy
Pursuant to Section 134(3)(n) of the Companies Act, 2013 and Regulation 17(9) of LODR, the Company has developed and implemented a Risk Management Policy. The Policy envisages identification of risk and procedures for assessment and strategies to mitigate / minimisation of risk thereof. The Risk Management Policy of the Company is available at the Companys website, at the following weblink -
https://www.ramcocements.in/investors/codes-and-policies
Risk Management
The Company has in place a well-defined risk management system to ensure identification of potential business risks. The system also has a framework which enables in implementing effective mitigation strategies. As per the ever-evolving internal and external factors, the system is periodically reviewed by the Risk Management Committee. The key risks and their mitigation measures are detailed below:
Operations and Maintenance risk
Risk arising from inadequacy or failure of internal processes, people or systems, may impact business operations. All processes and systems need to be maintained periodically for smooth functioning. Any disturbance in the operations would have adverse impact in the profitability.
Mitigation measures: To ensure smooth functioning of all processes and systems, the Company has in place well-structured standard operating procedures (SOP). These procedures also take care of the safety of the people at all times. To avoid possibility of any hazards like fire etc., the Company ensures proper storage of all hazardous material, coverage of all storage sheds, installation of explosion vents, linear heat sensing cables, fire tenders and fire hydrant. The Company is increasing the use of renewable energy and usage of alternate fuels to ensure adequate fuel availability. To avoid any crash accident within the premises, multiple precautions are in place. These preventive measures help the Company isolate itself from operations risk.
Raw material risk
Any unavailability or limited availability of important raw materials like fuels - pet coke and coal, and limestone, may result in disruption in production, resulting in impact of margin.
Mitigation measures: The Company has long term supply agreements in place for indigenous sourcing of raw materials. In addition to indigenous sources, the Company imports pet coke from Saudi Arabia, US, Gulf, etc. There are no supply constraints of pet coke. In terms of coal, while on the one hand India has ramped up its coal production, globally coal demand has softened also leading to softening in prices. The Company participates in various auctions to ensure its limestone needs are met adequately.
Logistics risk
Logistics is a crucial part of business operations. Any disruptions or increase in logistics cost may result in impact on business profitability.
Mitigation measures: The Company uses various modes of transportation like road, rail, and ports as per availability while ensuring cost optimization. To avoid damage of products in warehouse, the Company continuously educates its labourers to ensure proper handling. In addition, effective supervision helps in controlling damages. For the transit damages, the Company has insurance cover or agreement with transporters to cover any damages.
Human Resource risk
Human resource is a crucial part of organizational success. The Companys operations may get disrupted in case of high attrition rate, inadequate skillset of employees, overstaffing / understaffing, improper work environment and disturbances in industrial relations.
Mitigation measures: The Senior Management team meets periodically to review and execute the plan for filling key positions, arising out of retirement. Internal transfer policy is implemented for transferring employees to desired locations to manage any losses in personnel due to retirement/ resignation. Annual manpower forecast enables the Company to implement proper recruitment plan to hire right people at the right time. To ensure high retention rate, the Company has adopted employee friendly practices such as extending loan schemes, Group Medical Insurance, Group Personal Accident Insurance Scheme, car scheme, etc. The Company fosters a productive and safe work environment with open door policy and merit-based rewards and recognition. The Company also takes utmost care of safety at work and employee wellness of both physical and mental health through various programs and events, annual health check-ups, etc.
Information Technology risk
Keeping with changing times, the Company operations have been digitalised and dependent on IT systems. This makes it mandatory to ensure data security, prevent cyber-attacks, avoid unauthorised access and misuse of sensitive information or disruption to operations.
Mitigation measures: The Company conducts Vulnerability Assessment and Penetration Testing (VAPT) for identifying vulnerabilities and risks in IT Infrastructure through certified external authorities. This ensures that various Data Centre Servers, Cloud Servers and Firewall and Switches are completely isolated from external threats. The Companys IT security policy ensures protection of business information. The Companys IT system has been certified to ensure robustness as per industry standards.
Finance risk
The Company faces various risks arising due to volatility in interest rate, default of customer, insufficient funding for business needs, risk of guarantees or fluctuation in forex. These events may lead to financial losses for the Company.
Mitigation measures: The Company has secured its future financial needs through term loan sanctions. The Company has booked forward covers for high value import transactions insulating itself from foreign exchange fluctuation risks. To address fluctuation in interest rate, the Company closely monitors the fixed / floating ratio of financial liabilities.
The Company ensures it effectively manages servicing its repayment obligations through financial planning and analysis, forecasting cash flows regularly, monitoring and optimizing net working capital and managing existing credit facilities.
Competition risk
Given the lucrative growth prospects of the cement industry, there is heightened competitive intensity. With strong Governments focus on infrastructure development, all players are stepping up their game. This poses risk to Companys market position.
Mitigation measures: The Company follows the strategy of ‘Right Product for Right Application which helps strengthen its ability to market its capacities efficiently. The MACE Division of the Company educates the end users for making right choice to suit their specific requirements. The Company has enhanced its efforts in the Projects and Infrastructure segments. The Company motivates its dealers through close and continuous engagement which helps to not only maintain but also improve its counter share. Initiatives in building brand awareness and brand consciousness among the public, has enabled the Company to have a healthy moat against competition.
Commodity price risk
Commodity price risk arises on account of fluctuations in price of raw materials and fuels viz. coal and pet coke, which are linked to international developments. Since these are primary costs in cement production, any adverse fluctuation in these prices can lead to significant drop in operating profitability.
Mitigation Measures: The Company maintains adequate inventory of these raw materials. It also closely monitors the prices to make optimal buying decisions, inlcuding entering of long term contracts. The R & D division strives to develop usage of alternative fuels and optimum fuel mix to reduce the impact of the risk.
Subsidiary Companies
The Company has two subsidiaries, viz. Ramco Windfarms Limited and Ramco Industrial and Technology Services Limited.
The Company has no material subsidiaries.
Ramco Windfarms Limited (RWL)
The Share Capital of RWL is Rs.1 crore, out of which 71.50% is held by the Company. The rest of the share capital is held by Ramco Group of Companies.
The installed capacity of RWL was 39.835 MW as on 31-032024 comprising of 127 Wind Electric Generators.
The Company had generated 364.96 lakh units of power as compared to 331.27 lakh units of power during the previous year.
The revenue for the Company for the year ended 31-032024 was Rs.15.15 crores compared to Rs.13.51 crores for the previous year.
The Company had incurred a loss of Rs.11.66 crores for the year ended 31-03-2024 as against a profit of Rs.2.25 crores for the previous year. The loss for the year was due to increase in the depreciation cost consequent to reduction in useful life of components of wind electric generators.
The Total Comprehensive Income of the Company for the year is Rs.(11.66) crores as against Rs.2.25 crores of the previous year.
Ramco Industrial and Technology Services Limited (RITSL)
The Share Capital of RITSL is Rs.4.78 crores, out of which 94.11% is held by the Company. The rest of the share capital is held by Ramco Group of Companies.
The Company provides Transport services, Manpower services and Information Technology related services, mainly involving Software Implementation services.
The revenue of the Company for the year ended 31-03-2024 on standalone basis was Rs.48.18 crores as against Rs.40.13 crores for the previous year. The Companys profit after tax was Rs.1.50 crores as against the loss of Rs.3.65 crores for the previous year. The Total Comprehensive Income of the Company for the year is Rs.1.99 crores as against Rs.(3.85) crores of the previous year.
In accordance with Rule 5 of Companies (Accounts) Rules, 2014, a statement containing the salient features of the Financial Statements of the Subsidiaries and Associates is attached in Form AOC-1 as Annexure-1. The contribution of Subsidiaries and Associates to the overall performance of the Company are available in Form AOC-1.
In accordance with Regulation 46(2)(s) of LODR, separate audited financial statements of the above subsidiary companies are placed in the website of the Company.
Consolidated Financial Statements
The Company has 4 Associate Companies, viz. Rajapalayam Mills Limited, Ramco Industries Limited, Ramco Systems Limited and Madurai Trans Carrier Limited.
As per provisions of Section 129(3) of the Companies Act, 2013 and Regulation 34 of LODR, Companies are required to prepare a consolidated financial statement of the Company and of all the Subsidiaries and Associate Companies, which shall also be laid before the Annual General Meeting of the Company.
Accordingly, the consolidated financial statements incorporating the accounts of Subsidiary Companies and Associate Companies, along with the Auditors Report thereon, forms part of this Annual Report.
As per Section 136(1) of the Companies Act, 2013, the financial statements including consolidated financial statements are available at the Companys website at the following link
https://www.ramcocements.in/investors/financials
Separate audited accounts in respect of the subsidiary companies are also made available at the Companys website. The Company will provide a copy of separate audited financial statements in respect of its Subsidiary Companies to any shareholder of the Company who asks for it.
The consolidated net profit after tax of the Company amounted to Rs.359.95 crores for the year ended 31-03-2024 as compared to Rs.314.52 crores of the previous year.
The consolidated total comprehensive income for the year ended 31-03-2024 was Rs.424.15 crores as against Rs.313.43 crores of the previous year.
Directors and Key Managerial Personnel
Pursuant to Rule 8(5)(iii) of Companies (Accounts) Rules, 2014, it is reported that, the Company had appointed Shri.CK.Ranganathan and Shri.Ajay Bhaskar Baliga as Non-Executive Independent Directors, for a period of 5 consecutive years commencing from 1st March 2024 to 28th February 2029. Further, the Company had appointed Shri.R.Dinesh as Non-Executive Non-Independent Director from 1st March 2024, who would be liable to retire by rotation. All the Directors were appointed through Postal Ballot process.
Further, the following three Directors had retired on 31st March 2024, after completing their term of two consecutive five years each in office.
Shri.R.S. Agarwal, Non-Executive Independent Director Shri.M.B.N.Rao, Non-Executive Independent Director Shri.M.M.Venkatachalam, Non-Executive Independent Director
Shri.P.R.Venketrama Raja retires at the forthcoming AGM and offers himself for reappointment. His reappointment has been included as an Ordinary Resolution, in the Notice convening the AGM scheduled to be held on 16-08-2024.
Dr. M.S.Krishnan, Independent Director completes his first term of 5 years on 02-09-2024. In accordance with Section 149(10) of the Companies Act, 2013, he is eligible for reappointment upon passing of a Special Resolution at the General Meeting of the Company. His reappointment has been included as a Special Resolution, in the Notice convening the AGM scheduled to be held on 16-08-2024.
The disclosures for appointment / reappointment of Directors, as required under Secretarial Standard-2 are available in the notice convening the AGM.
The Independent Directors hold office for a fixed term of 5 years from the date of their appointment and are not liable to retire by rotation.
The Company has received necessary declarations from all the Independent Directors under Section 149(7) of the Companies Act, 2013, that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013. Independent Directors have complied with the Code for Independent Directors prescribed in Schedule IV of the Companies Act, 2013.
Pursuant to Rule 8(5)(iii) of Companies (Accounts) Rules, 2014, it is reported that, there have been no changes in the Key Managerial Personnel during the year under review and after the end of the year and upto the date of the report.
The Company had formulated a Code of Conduct for the Directors and Senior Management personnel and the same has been complied with.
The Company has a policy relating to appointment and remuneration of Directors, Key Managerial Personnel and other employees duly approved by the Board of Directors, based upon the recommendation of Nomination and Remuneration Committee, in accordance with Section 178(3) of the Companies Act, 2013.
As per Proviso to Section 178(4) of the Companies Act, 2013, the salient features of the Nomination and Remuneration Policy should be disclosed in the Boards Report. Accordingly, the following disclosures are given:
Salient Features of the Nomination and Remuneration Policy: The objective of the Policy is to ensure that:
(a) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the company successfully;
(b) relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and
(c) remuneration to directors, key managerial personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals.
The Nomination and Remuneration Committee and this Policy are in compliance with the Companies Act, 2013 and LODR.
The web address of the Policy is - https://www.ramcocements.in/investors/codes-and-policies
As required under Regulation 25(7) of LODR, the Company has programmes for familiarisation for the Independent Directors about the nature of the industry, business model, roles, rights and responsibilities of Independent Directors and other relevant information. As required under Regulation 46(2)(i) of LODR, the details of the Familiarisation Programme for Independent Directors are available at the Companys website, at the following link -
https://www.ramcocements.in/investors/management
The details of familiarisation programme are explained in the Corporate Governance Report also.
The details of remuneration received by the Managing Director, during the year under review are available in the Corporate Governance report.
Board Evaluation
Pursuant to Section 134(3)(p) of the Companies Act, 2013, and Regulation 25(4) of LODR, Independent Directors have evaluated the quality, quantity and timeliness of the flow of information between the Management and the Board, performance of the Board as a whole and its Members and other required matters.
Pursuant to Schedule II, Part D of LODR, the Nomination and Remuneration Committee has laid down evaluation criteria for performance evaluation of Independent Directors, which is based on attendance, expertise and contribution brought in by the Independent Director at the Board and Committee Meetings, which shall be taken into account at the time of reappointment of Independent Director.
Pursuant to Regulation 17(10) of LODR, the Board of Directors have evaluated the performance of Independent Directors and observed the same to be satisfactory and their deliberations beneficial in Board / Committee meetings.
Pursuant to Regulation 4(2)(f)(ii)(9) of LODR, the Board of Directors have reviewed and observed that the evaluation framework of the Board of Directors was adequate and effective.
The Boards observations on the evaluations for the year under review were similar to their observations for the previous year. No specific actions have been warranted based on current year observations.
The Company would continue to familiarise its Directors on the industry, technology and statutory developments, which have a bearing on the Company and the industry, so that Directors would be effective in discharging their expected duties.
Meetings
During the year, 8 Board Meetings were held. The details of Meetings of the Board and Committees held during the financial year including the number of Meetings attended by each Director are given in the Corporate Governance Report. The details of Committees constituted by the Board are available in the Corporate Governance Report. There are no changes in the composition of the committees during the year under review.
Recommendations of Audit Committee
There has not been an occasion, where the Board had not accepted any recommendation of any Committee of the Board.
Secretarial Standards
The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and that such systems are adequate and operating effectively. The Company is in compliance with all the applicable Secretarial Standards.
Public Deposits
The Company has stopped accepting deposits from 01-04-2014 and have repaid / transferred to IEPF the deposits as the case may be and no deposit amount is pending with the company.
Orders Passed by Regulators
Pursuant to Rule 8(5)(vii) of Companies (Accounts) Rules, 2014, it is reported that, no significant and material orders have been passed by the Regulators or Courts or Tribunals, impacting the going concern status and Companys operations in future.
Internal Financial Controls
In accordance with Section 134(5)(e) of the Companies Act, 2013, the Company has Internal Financial Controls by means of Policies and Procedures commensurate with the size & nature of its operations and pertaining to financial reporting. In accordance with Rule 8(5)(viii) of Companies (Accounts) Rules, 2014, it is hereby confirmed that the Internal Financial Controls are adequate with reference to the financial statements.
Particulars of Loans, Guarantees and Investments
Pursuant to Section 186(4) of the Companies Act, 2013, the details of loans, guarantees and investments along with the purposes are provided under Notes No. 12, 13, 14, 21 and 49 of Notes to the Separate Financial Statements.
Audits
Statutory Audit
The Members at the Annual General Meeting held on 10-082022 have appointed M/s.Ramakrishna Raja And Co., Chartered Accountants, (FRN: 005333S) and M/s.SRSV & Associates, Chartered Accountants, (FRN: 015041S), as the Statutory Auditors of the company for their second term of five years from the conclusion of the 64th Annual General Meeting, till the conclusion of the 69th Annual General Meeting of the Company.
In accordance with Regulation 33(1 )(d) of SEBI (LODR) Regulations, 2015, the auditors have submitted the necessary certificates issued by Peer Review Board of the Institute of Chartered Accountants of India.
The report of the Statutory Auditors for the year ended 31st March 2024 does not contain any qualification, reservation or adverse remark. No fraud has been reported by the Companys Auditors.
Cost Audit
As per Rule 3 of Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost records and accordingly such records and accounts are made and maintained.
The Board of Directors had approved the appointment of M/s. Geeyes & Co., Cost Accountants as the Cost Auditors of the Company to audit the Companys Cost Records for the year 2024-25 at a remuneration of Rs.7,00,000/- (Rupees Seven lakhs only) exclusive of GST and out-of-pocket expenses.
The remuneration of the cost auditor is required to be ratified by the members in accordance with the provisions of Section 148(3) of the Companies Act, 2013 and Rule 14 of Companies (Audit and Auditors) Rules, 2014. Accordingly, the matter relating to their remuneration had been included in the Notice convening the 66th Annual General Meeting scheduled to be held on 16-08-2024, for ratification by the Members.
The Cost Audit Report for the financial year 2022-23 due to be filed with Ministry of Corporate Affairs by 06-09-2023, had been filed on 02-09-2023. The Cost Audit Report for the financial year 2023-24 due to be submitted by the Cost Auditor within 180 days from the closure of the financial year will be filed with the Ministry of Corporate Affairs, within 30 days of such submission.
Secretarial Audit
M/s.S.Krishnamurthy & Co., Company Secretaries, have been appointed to conduct the Secretarial Audit of the Company. Pursuant to Section 204(1) of the Companies Act, 2013, the Secretarial Audit Report submitted by the Secretarial Auditors for the year ended 31st March 2024 is attached as Annexure-2. The report does not contain any qualification, reservation or adverse remark.
There are no changes in the Statutory, Cost and Secretarial Auditors of the Company during the year under review and upto the date of this report.
Annual Return
The Annual Return for the year ended 31st March 2023 in Form MGT-7, filed with Ministry of Corporate Affairs, is available in the Companys website at the following link:https://www.ramcocements.in/investors/shareholders
Corporate Governance
The Company has complied with the requirements regarding Corporate Governance as stipulated in LODR. As required under Schedule V(C) of LODR, a Report on Corporate Governance being followed by the Company is attached as Annexure-3.
No complaints had been received pertaining to sexual harassment, during the year under review. The relevant statutory disclosure pertaining to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, are available at Point No.11(l) of Corporate Governance Report.
As required under Schedule V(E) of LODR, a Certificate from the Secretarial Auditors confirming compliance of conditions of Corporate Governance is also attached as Annexure-4.
As required under Regulation 34(3) read with Schedule V Para C (10)(i) of LODR, Certificate from the Secretarial Auditor that none of the Companys Directors have been debarred or disqualified from being appointed or continuing as Directors of Companies, is enclosed as Annexure-5.
Corporate Social Responsibility
In terms of Section 135 and Schedule VII of the Companies Act, 2013, the Board of Directors have constituted a Corporate Social Responsibility (CSR) Committee and adopted a CSR Policy which is based on the philosophy that "As the Organisation grows, the Society and Community around it also grows."
The Annual Report on CSR activities as prescribed under Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached as Annexure-6.
Vigil Mechanism / Whistle Blower Policy
In accordance with Section 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of LODR, the Company has established a Vigil Mechanism and has a Whistle Blower Policy. The Policy provides the mechanism for the receipt, retention and treatment of complaints and to protect the confidentiality and anonymity of the stakeholders. The complaints can be made in writing to be dropped into the Whistle Blower Drop Boxes or through E-Mail to dedicated mail IDs. The Corporate Ombudsman shall have the sole access to these. The Policy provides to the complainant access to the Chairman of the Audit Committee. The weblink for the Vigil Mechanism is disclosed in the Corporate Governance Report.
Related Party Transactions
Prior approval / omnibus approval is obtained from the Audit Committee for all Related Party Transactions and the transactions are also periodically placed before the Audit Committee for its approval. The details of contracts required to be disclosed in Form AOC-2 are given in Annexure-7.
No transaction with the related party is material in nature, in accordance with Companys "Related Party Transaction Policy" and Regulation 23 of LODR. In accordance with Ind AS-24, the details of transactions with the related parties are set out in the Notes to the Financial Statements.
As required under Regulation 46(2)(g) of LODR, the Related Party Transaction Policy is disclosed in the Companys website and its weblink is -https://www.ramcocements.in/investors/codes-and-policies
As required under 46(2)(h) of LODR, the Companys Material Subsidiary Policy is disclosed in the Companys website and its weblink is -https://www.ramcocements.in/investors/codes-and-policies
Material Changes since 1st April 2024
There have been no material changes affecting the financial position of the Company between the end of the financial year and till the date of this report.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo
Pursuant to Section 134(3)(m) of the Companies Act, 2013 and Rule 8(3) of Companies (Accounts) Rules, 2014, the information relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo is attached as Annexure-8.
Particulars of Employees and Related Disclosures
The disclosure with respect to remuneration as required under Section 197 of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure-9.
The statement containing names of the top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Companies Act, 2013, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate Annexure forming part of this report.
However, the annual report is being sent to the Members, excluding the aforesaid Annexure. In terms of Section 136 of the Companies Act, 2013, the said Annexure is open for inspection. Any Member interested in obtaining a copy of the same may write to the Company Secretary.
Employee Stock Option Scheme
At the Annual General Meeting held on 03-08-2018, the Members had approved the following Employee Stock Option Schemes.
| Name of the Scheme | Total No. of Options | Exercise Price | Vesting Period | Maximum Term | Source |
| ESOS 2018 - Plan A | 5,00,000 | Rs.1/- per share | One year from the date of grant | 31st December of the immediately succeeding Financial Year, in which the vesting was done. | Primary |
| ESOS 2018 - Plan B | 700,000 | Rs.100/- per share |
The relevant disclosures in terms of Rule 12 of Companies (Share Capital and Debentures) Rules, 2014 and Secretarial Standard on Report of the Board of Directors are given below:
Details of Movement of Employee Stock Options during the year:
| Sl. No | Particulars | ESOS 2018 - Plan A | ESOS 2018 - Plan B |
| (a) | Number of options granted during the year | Nil | Nil |
| (b) | Number of options vested during the year | Nil | Nil |
| (c) | Number of options exercised during the year | Nil | Nil |
| (d) | Number of shares arising as a result of exercise of options | Nil | Nil |
| (e) | Number of options lapsed during the year | Nil | Nil |
| (f) | Exercise Price | Rs.1/- | Rs.100/- |
| (g) | Variation of terms of options | Nil | Nil |
| (h) | Money realized by exercise of options (INR), if scheme is implemented directly by the Company | Nil | Nil |
| (i) | Total Number of options in force (available for grant, but not yet granted) | 1,69,000 | 3,15,400 |
| (j) | Employee-wise details of options granted to | ||
| (i) Key Managerial Personnel | Nil | Nil | |
| (ii) Any other employee who receives a grant in any one year of option amounting to 5% or more of option granted during that year | Nil | Nil | |
| (iii) Identified employees who were granted option, during any one year, equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant | Nil | Nil |
The purpose of these plans are to facilitate Eligible Persons (Employees with Long Service and Contributed to the growth of the Company) through ownership of Shares of the Company to participate and gain from the Companys performance, thereby acting as a suitable reward. Participation in the ownership of the Company, through share based compensation schemes will be a just reward for the employees for their continuous hard work, dedication and support, which has led the Company to be what it is today.
The Plans are intended to:
• Create a sense of ownership within the organisation;
• Encourage Employees to continue contributing to the success and growth of the organisation;
• Retain and motivate Employees;
• Encourage Eligible Persons to align their performance with Company objectives;
• Reward Eligible Persons with ownership in proportion to their contribution;
• Align interest of Eligible Persons with those of the organisation.
The schemes are in compliance with the SEBI Regulations. During the year under review, no material changes have been made in the schemes.
A certificate from the Companys Secretarial Auditors, with respect to implementation of the above Employee Stock Option Schemes in accordance with SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, and the resolution passed by the Members of the Company has been received and the same is attached as Annexure-10.
The details as required under Part F of Schedule I read with Regulation 14 of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, are disclosed on the Companys website and the web link is given below: https://www.ramcocements.in/investors/shareholders
Credit Rating
The ratings for the Companys borrowing are available in Corporate Governance Report.
Awards
The Company has been receiving various awards in Environment, Health & Safety, CSR, Energy Efficiency, etc. More details are available in Page No: 53.
Business Responsibility and Sustainability Report (BRSR)
The details of key initiatives with respect to stakeholder relationship, customer relationship, environment, sustainability, health & safety are available in the BRSR for the year 2023-24, which forms part of this report.
Shares
The Companys shares are listed in BSE Limited and National Stock Exchange of India Limited.
Investor Education and Protection Fund (IEPF)
During the year under review, the Company was not having any dividend amount, which remained unclaimed/unpaid for a period of over 7 years. Thus, the Company was not obligated to transfer any unclaimed/unpaid dividends to IEPF.
Shares transferred to IEPF, during the year under review are detailed below:
| No. of Shares | Date of Transfer to IEPF |
| 93,754 | 20-04-2023 |
| 4,056 | 27-04-2023 |
Year wise amount of unpaid/unclaimed dividend lying in the unpaid account and corresponding shares, which are liable to be transferred to IEPF and due dates for such transfer, are tabled below:
| Year | Type of Dividend | Date of Declaration of Dividend | Last Date for Claiming Unpaid Dividend | Due Date for Transfer to IEP Fund | No. of Shares of Rs.1/- each | Amount of Unclaimed / Unpaid Dividend as on 31-03-2024 - Rs. |
| 2016-17 | Dividend | 04-08-2017 | 03-08-2024 | 02-09-2024 | 14,73,902 | 44,21,706 |
| 2017-18 | Dividend | 03-08-2018 | 02-08-2025 | 01-09-2025 | 7,97,722 | 23,93,166 |
| 2018-19 | Dividend | 08-08-2019 | 07-08-2026 | 06-09-2026 | 743,212 | 22,29,636 |
| 2019-20 | Dividend | 03-03-2020 | 02-03-2027 | 01-04-2027 | 6,89,999 | 1724,997 |
| 2020-21 | Dividend | 12-03-2021 | 11-03-2028 | 10-04-2028 | 733,399 | 19,95,837 |
| 2021-22 | Dividend | 10-08-2022 | 09-08-2029 | 08-09-2029 | 763,918 | 20,61,905 |
| 2022-23 | Dividend | 10-08-2023 | 09-08-2030 | 08-09-2030 | 6,74,506 | 12,41,715 |
Directors Responsibility Statement
Pursuant to Section 134(5) of the Companies Act, 2013, the
Directors confirm that
(a) t hey had followed the applicable accounting standards along with proper explanation relating to material departures, if any, in the preparation of the annual accounts for the year ended 31st March 2024;
(b) t hey had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on 31st March 2024 and of the profit of the Company for the year ended on that date;
(c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) they had prepared the annual accounts on a going concern basis;
(e) they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Acknowledgement
The Directors are grateful to the various Departments and agencies of the Central and State Governments for their help and co-operation. They are thankful to the Financial Institutions and Banks for their continued help, assistance and guidance. The Directors also wish to place on record their appreciation of employees at all levels for their commitment and their contribution.
| On behalf of the Board of Directors, | |
| For THE RAMCO CEMENTS LIMITED, | |
| M. F. FAROOQUI | |
| Chennai | Chairman |
| 22-05-2024 | (DIN : 01910054) |
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