07-11-2012, 05:09 PM
FINANCIAL ANALYSIS FOR ULTRA TECH CEMENT
FINANCIAL ANALYSIS FOR ULTRA TECH CEMENT.docx (Size: 582.58 KB / Downloads: 42)
HISTORY
SorenKristian Toubro, a civil engineer and Henning Holck Larsen, a chemical engineer, the founder of Larsen & Toubro (L&T) Company were schoolmates, later attended the same engineering college in Denmark. After becoming engineers both joined, the firm named ‗F. L. Smidth& Company‘, which was Cement machine manufacturing Company.
Then both came to India in 1935 to assess the value of various cement-manufacturing groups on behalf of F. L. Smidth& Company M/S Copenhagen. These groups later merged into the Associated Cement Companies. After completing this task, they searched for proper places for F.L. Smidth‘s local offices in India.
In the course of their work, both visited India, observed Indian people, and decided to start their own business here. They started a partnership concern on 1st May 1938 and started undertaking repair jobs on the imported machinery like pasteurizes, butter Chuns, creams separators since supply of these machines were stopped due to world war II. Gradually, they began to develop and manufacture several of these and other types of dairy equipments. Very soon, L & T was acknowledged as a reliable fabricator with high standards.
L & T has entered in Cement business in 1980. L & T established its first plant at Awarpur, Maharashtra in 1983. Second plant was established in 1991 at Hirmi, M.P. Third and largest plant was established in 1996 at Kovaya, Gujarat. The fourth plant was established at Tadipatri, A.P. in 1998.
GCW‘s operations started from 2 April 1996. It became Asia‘s largest cement producing unit with the capacity of 4.2 million-tone per annum.
PROFILE
UltraTech Cement Limited, a Grasim subsidiary has an annual capacity of 18.2 million tonnes. It manufactures and markets Ordinary Portland Cement, Portland Blast Furnace Slag Cement and Portland Pozzolana Cement.
UltraTech has five integrated plants, five grinding units and three terminals — two in India and one in Sri Lanka. These include an integrated plant and two grinding units of the erstwhile Narmada Cement Company Limited, a subsidiary, which has been amalgamated with the company in May 2006.
UltraTech is the country's largest exporter of cement clinker. The company exports over 2.5 million tonnes per annum, which is about 30 per cent of the country's total exports. The export markets span countries around the Indian Ocean, Africa, Europe and the Middle East.
The cement division of L&T was demerged in 2004 after Grasim made the 30 per cent open offer for equity shares, gaining control over the new company, christened UltraTech. Besides the long term strategic value in the wake of rising demand for cement, with the growth of housing and infrastructure sectors in the country, the acquisition brings significant synergy gains to the parent company.
Ready Mix Concrete is likely to see substantial growth in the coming years. Recognizing the opportunities that this business will offer, UltraTech has commenced setting up of Ready Mix Concrete plants at various places in the country.
Ultra Tech Cement Limited (Formerly known as L & T Cement Ltd.) is a very well known name in the field of cement. The registered office and head office of the company is at Mumbai.
This company‘s reputation is based on a strong customer orientation, the technological sophistication that characterizes its products, and an impressive record of achievements. Ultra Tech has initiated a transformation process to ensure that it emerges as a knowledge-based premium conglomerate in the shortest possible time. Each of its plants incorporated state-of-art technology. Ultra Tech Cement has strong brand equity and commands a price premium in most markets.
Out of six cement plants of Ultra Tech, GCW at Kovaya is the largest cement plant in Asia. There are two phases in the plant, which are almost identical in layout and production capacity. The reason for laying such a big plant near a small village like Kovaya can be justified by the fact that this region is very rich of limestone resources, which is the chief raw material for cement production. The estimated resources of limestone mines are enough to supply raw material for next 40 years to GCW. Ultra Tech is India‘s largest manufacturer of premium quality cement. Ultra Tech has nationwide network of factories, offices and sales centers. Authorized stockiest dealing in the company‘s product line, including cement, is located directly or indirectly in every district of the country.
UltraTech's subsidiaries are: Dakshin Cements Limited and UltraTechCeylinco (Private) Limited.
ULTRA TECH CEYLINCO (PVT.)LIMITED.
Ceylinco insurance company limited and UltraTech have incorporated this subsidiary in Sri Lanka.
Ceylinco is one of the most respected business groups in Sri Lanka with activities in the field of banking, insurance and finance.
A bulk Cement terminal has been established near Colombo with annual output of 0.5 MT.
Cement in bulk is sourced from Ultra Tech‘s Gujarat Cement works and transported by carriers to Colombo.
Definition and Explanation of Financial Statement Analysis:
Financial statement analysis is defined as the process of identifying financial strengths andweaknesses of the firm by properly establishing relationship between the items of the balancesheet and the profit and loss account.
There are various methods or techniques that are used in analyzing financial statements, such as comparative statements, schedule of changes in working capital, common size percentages, funds analysis, trend analysis, and ratios analysis.
Financial statements are prepared to meet external reporting obligations and also for decision making purposes. They play a dominant role in setting the framework of managerial decisions. But the information provided in the financial statements is not an end in itself as no meaningful conclusions can be drawn from these statements alone. However, the information provided in the financial statements is of immense use in making decisions through analysis and interpretation of financial statements.