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UltraTech Cement Ltd
Industry : Cement - North India
BSE Code:532538NSE Symbol:ULTRACEMCOP/E :41.04
ISIN Demat:INE481G01011Div & Yield %:0.71EPS :241.02
Book Value:2046.9617705Market Cap (Rs.Cr):285543.3Face Value :10

Dear Shareholders,

Your Directors present the 23rd Annual Report together with the audited accounts of your Company for the year ended 31st March, 2023.

Overview and the state of your Company's affairs

The International Monetary Fund ("IMF") projects global growth to fall to 2.8% in 2023 before rising to 3.0% in 2024, where advanced economies are expected to see an especially pronounced growth slowdown, from 2.7% in 2022 to 1.3%. The IMF projects that in a plausible alternative scenario with further financial sector stress, global growth could decline to about 2.5% in 2023 with advanced economy growth falling below 1.0%. Global inflation is expected to fall from 8.7% in 2022 to 7.0% in 2023 and 4.9% in 2024, which is yet above pre-COVID-19 pandemic range of average 3.5% between 2017 and 2019. Elevated interest rates, financial sector stress compelling central banks to reconsider policy actions, and the war in Ukraine continue to weigh on global economic activity.

Over the next two years India is projected to be the fastest-growing major economy, as IMF projects India's GDP growth at 5.9% and 6.3% during 2023 and 2024 respectively, which is expected to surpass China's 5.2% and 4.5% GDP growth in the same period. This is despite the three shocks of COVID-19, the Russia–Ukraine conflict, and central banks across economies led by the US Federal Reserve responding with synchronised policy rate hikes to curb inflation, leading to appreciation of the US dollar and the widening of Current Account Deficits in net importing economies.

The Indian economy appears to have moved on after its encounter with the pandemic, staging a full recovery in FY22 ahead of many nations and positioning itself to ascend to the pre-pandemic growth path in FY23. Yet in the current year, India has also faced the challenge of reining in inflation that the European strife accentuated. Measures taken by the government and the Reserve Bank of India ("RBI"), along with the easing of global commodity prices, finally managed to bring retail inflation below the RBI upper tolerance target in March 2023. In the process of arresting rising inflation, during FY23, the RBI hiked interest rates by 2.5% in six tranches. India's economic growth is expected to be brisk in FY24, as a vigorous credit disbursal and capital investment cycle is expected to unfold in India with the strengthening of balance sheets in the corporate and banking sectors. Direct tax revenue collections have been highly buoyant and so have GST collections, which should ensure the full expending of the Capex budget within the budgeted fiscal deficit. Further, support to economic growth will come from the expansion of public digital platforms and path-breaking measures such as PM GatiShakti, the National Logistics Policy, and the Production-Linked Incentive ("PLI") schemes to boost manufacturing output.

The capital expenditure initiatives of the central government are another growth driver of the Indian economy. A sustained increase in private Capex is imminent with the strengthening of the balance sheets of corporates and the consequent increase in credit financing it has been able to generate. The Mahatma Gandhi National Rural Employment Guarantee Scheme ("MGNREGS") has been directly providing jobs in rural areas and indirectly creating opportunities for rural households to diversify their sources of income generation. Schemes like PM-Kisan and PM Garib Kalyan Yojana have helped in ensuring food security in the country.

Despite strong global headwinds and tighter domestic monetary policy, the IMF expects India to grow around 5.9% in 2023. This growth, without the advantage of a base effect, reflects India's underlying economic resilience – its ability to recoup, renew, and re-energise the growth drivers of the economy. India's economic resilience can be seen in the domestic stimulus to growth seamlessly replacing the external stimuli. Structural reforms implemented by the government have resulted in ease of doing business. The release of Urban Real Estate demand was reflected in the housing market too as demand for housing loans picked up. At Rs19,36,428 crores at the end of March 2023, outstanding housing loans have grown by an absolute 14.9% and 42.2% compared to a respective Rs16,84,424 crores a year ago and Rs13,61,880 crores at the end of March 2020. Consequently, housing inventories have declined, prices are firming up, and construction of new dwellings is picking up pace, and this has stimulated innumerable backward and forward linkages that the construction sector is known to carry. The universalisation of COVID-19 vaccination coverage also has a significant role in lifting the housing market as, in its absence, the migrant workforce could not have returned to construct new dwellings.

Apart from housing, construction activity, in general, has significantly risen in FY23 as the much-enlarged capital budget of the central government and its public sector enterprises is rapidly being deployed.

Cement Industry during FY23

The country's cement demand is expected to climb by around 10% over fiscal year 2023, as reported by a leading ratings agency. The growing housing sector, which typically accounts for 60% to 65% of India's cement consumption, will remain a key demand driver. Also, continued large investments in roads and infrastructure projects will fuel cement demand.

In the Union Budget 2023–24, the government has allocated US $1.8 billion for the creation of safe housing, clean drinking water, and sanitation, and increasing road and telecom connectivity, among other initiatives. The government has also allocated US $9.6 billion to address housing shortages. As per a post-budget report by a research affiliate of a credit rating agency, cement demand is expected to witness third straight year of growth with a 7% to 9% jump to ~425 million tonnes in FY24. In FY24, infrastructure and affordable rural housing segments are expected to propel growth, where the highest traction is expected from roads, where the total annual outlay for the Ministry of Road Transport and Highways and the National Highways Authority of India ("NHAI") has seen an increase of 25% and 14%, respectively. The government has also increased budget outlay for affordable rural housing under the Pradhan Mantri Awas Yojana – Gramin ("PMAY-G") by 12.5% for FY24. Launched in 2015, PMAY-G is part of the Pradhan Mantri Awas Yojana ("PMAY"), a massive government scheme promoting affordable housing in India.

It is against this backdrop, that we share your Company's performance during FY23.

Business Performance

Production and Capacity Utilisation (Grey Cement)

Particulars FY23 FY22 % change
Installed capacity in India (MTPA) 126.95 114.55 11
Production (MMT) 99.43 86.98 14
Capacity Utilisation 84% 77% 7

MMTPA – Million Metric Tonnes Per Annum; MMT – Million Metric Tonnes

Cement production in FY23 was higher by 14% at 99.43 million tonnes as compared to FY22, while capacity utilisation was at 84% as compared to 77%.

Sales Volume

(Figures in MMT)
Particulars FY23 FY22 % change
Grey Cement – India 100.10 88.00 14
Grey Cement – Overseas 4.42 4.93 (10)
White Cement 1.63 1.46 11
Total Sales Volume* 105.71 93.99 12

* after elimination of inter Company sales.

Domestic sales volume registered a growth of 14% in FY23. Your Company achieved the unique distinction of registering over 100 million tonnes of production, dispatches and sales in FY23.

Financial Performance

( Rs in crores)
Standalone Consolidated
FY23 FY22 FY23 FY22
Net Turnover 60,463 49,729 62,338 51,708
Domestic 60,236 49,479 60,192 49,528
Exports 226 250 2,145 2,180
Other Income (Other Operating Income and Other Income) 1,553 1,546 1,405 1,399
Total Expenditure 51,395 39,727 52,620 41,084
Profit before Interest, Depreciation, and Tax (PBIDT) 10,621 11,548 11,123 12,022
Depreciation 2,619 2,457 2,888 2,715
Profit before Interest and Tax (PBIT) 8,001 9,091 8,235 9,307
Interest 755 798 823 945
Profit before Impairment and Tax Expenses / share in profit of Associates 7,246 8,293 7,412 8,363
Share in Profit / (Loss) of Associates and Joint Venture - - 4 2
(net of tax)
Profit before Tax Expenses 7,246 8,293 7,416 8,364
Normalised Tax Expenses 2,329 2,744 2,343 2,708
Reversal of Tax Provision of Earlier Years - (1,518) - (1,518)
Profit after Tax (PAT) 4,917 7,067 5,073 7,174
Profit Attributable to Non-controlling Interest - - 9 (10)
Profit Attributable to Owner of the Parent - - 5,064 7,184

Other Income

Other income is in line with the previous year.

Operating Profit (PBIDT) and Margin

PBIDT at Rs10,621 crores was 8% lower than the previous year. The lower operating margin was attributable to higher input costs, partly offset by volume growth and better sales realisations.

Cost Highlights i. Energy Cost

Overall energy costs increased by 36% from Rs1,240/t to Rs1,692/t mainly due to higher fuel prices.

ii. Input Material Costs

Raw material costs rose from Rs531/t to Rs600/t because of an increase in additive and fly ash prices. Increase in diesel prices impacted inbound transportation and mining costs, resulting in higher raw material costs. Your Company is continuously working on improving the share of blended and premium products in its product mix, which is expected to result in an improvement in overall profitability.

iii. Freight and Forwarding Expenses

Logistics costs increased marginally from Rs1,214/t to

Rs1,248/t due to an increase in diesel cost as well as business season surcharges levied on railway freight. Reduction in lead distance mainly on account of a change in the market mix and synergies arising out of the integration of acquired assets aided in lowering the impact of rising diesel costs.

Employee Costs

Employee costs increased to Rs2,562 crores as compared to Rs2,359 crores in the previous year, primarily due to the annual increments.


At Rs2,619 crores, depreciation was higher by Rs162 crores, on account of capitalisation of new capacities during the year.

Finance Cost

Repayment of borrowings led to a decrease in finance costs from Rs798 crores to Rs755 crores. However, an increase in the interest rate impacted interest costs. Your Company does not accept any fixed deposits from the public falling under Section 73 of the Companies Act, 2013 ("the Act") and the Companies (Acceptance of Deposits) Rules, 2014.

Credit Rating

Your Company has adequate liquidity and a strong balance sheet. CRISIL and India Ratings and Research reaffirmed their credit rating as CRISIL AAA/Stable and IND AAA/ Stable for Long Term and CRISIL A1+ and IND A1+ for Short Term, respectively. Further, CARE Ratings has rated the long-term borrowings as CARE AAA/Stable and short-term borrowings as CARE A1+.

Your Company has also obtained its credit rating for its foreign currency bond issuances from Fitch and Moody's and has been rated by them as BBB- and Baa3, respectively.

This is a testament to your Company's sound financial management as well as its ability to service financial obligations in a timely manner.

Income Tax

Normalised income tax expenses increased in line with an increase in taxable income.

Net Profit

Normalised PAT decreased by 11% from Rs5,549 crores to Rs4,917 crores.

Significant changes in key financial ratios, along with detailed explanations:

Particulars FY23 FY22 % Change
Debtors Turnover (Days) 18 18 -
Inventory Turnover (Days) 34 33 (4)
Interest Coverage Ratio 12.60 12.72 (1)
Current Ratio 1.21 1.30 (7)
Debt Equity Ratio (Gross) 0.17 0.20 (18)
Debt Equity Ratio (Net) 0.03 0.07 (53)
Operating Profit Margin (%) 16.4 22.0 (25)
Net Profit Margin (%) 8.1 11.2 (27)
Return on Net Worth (%) 9.3 11.3 (18)
Return on Capital Employed (%) 12.1 14.4 (16)
Earnings Per Share (EPS) 171 192 (11)

Detailed explanation of ratios

I. Debtors Turnover (Days) is used to quantify a company's effectiveness in collecting its receivables or money owed by customers. The ratio shows how well a company uses and manages the credit it extends to customers. The ratio is calculated by dividing average trade receivables by average per day turnover.

II. Inventory Turnover (Days) represents the average number of days a company holds its inventory before selling it. It is calculated by dividing average inventory by average per day turnover.

III. Interest Coverage Ratio measures how many times a company can cover its current interest payment with its available earnings. It is calculated by dividing PBIT by finance cost. Your Company's Interest Coverage Ratio decreased by 1% over the previous year mainly on account of lower PAT during the year.

IV. Current Ratio is a liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year. It is calculated by dividing the current assets by current liabilities (excluding current borrowings).

V. Debt Equity Ratio is used to evaluate a company's financial leverage. It is a measure of the degree to which a company is financing its operations through debt versus wholly owned funds. It is calculated by dividing a company's total liabilities by its shareholder's equity. Your Company's Debt Equity Ratio (Net) has improved by 18% mainly on account of reduction in debt during the year.

VI. Operating Profit Margin (%) is a profitability or performance ratio used to calculate the percentage of profit a company generates from its operations. It is calculated by dividing the PBIDT (excluding Other Income) by turnover. Your Company's Operating Profit Margin decreased by 25% mainly on account of higher costs, partly set off by higher volume and higher realisations during the year.

VII. Net Profit Margin (%) is equal to how much net income or profit is generated as a percentage of revenue. It is calculated by dividing the profit for the year by turnover. Your Company's Net Profit Margin decreased by 27% mainly on account of higher costs and was partly set off by higher volume, higher realisations and lower interest outgo during the year. VIII. Return on Net Worth ("RONW") is a measure of profitability of a company expressed as a percentage. It is calculated by dividing Net Profit from continuing operations for the year by average Net Worth during the year.

IX. Return on Capital Employed ("ROCE") is a financial ratio that measures a company's profitability and the efficiency with which its capital is used. In other words, the ratio measures how well a company is generating profits from its capital. It is calculated by dividing profit before interest, exceptional items, and tax by average capital employed during the year.

X. Earnings Per Share ("EPS") is the portion of a company's profit allocated to each share. It serves as an indicator of a company's profitability. It is calculated by dividing profit for the year by weighted average number of shares outstanding during the year. For your Company, the EPS decreased on account of reduction in Net Profit by 11.4% over that of the previous year.

Cash Flow Statement

(Rs in crores)
FY23 FY22
Sources of Cash
Cash from Operations 8,789 9,237
Non-operating Cash Flow 482 286
Proceeds from Issue of Share Capital 5 4
(Increase) / Decrease in Working Capital 559 (567)
Total 9,835 8,960
Uses of Cash
Net Capital Expenditure 5,831 5,422
(Redemption) / Increase in Investments 529 (7,734)
Investment in Subsidiaries, Joint Ventures, Associates, and Others 875 1,809
Repayment of Borrowings (Net) 360 7,360
Repayment of Lease Liability including Interest thereof 167 160
Purchase / (Sale or Issue) of Treasury Shares (Net) 106 83
Interest 650 838
Dividend 1,091 1,065
Total 9,610 9,002
Increase / (Decrease) in Cash and Cash 225 (42)

Sources of Cash

Cash from Operations

Cash from operations was lower compared to the previous year due to the rise in costs, which was partly set-off by higher volume and sales realisation.

Non-Operating Cash Flow

Cash from other activities was higher on account of increased interest income on bank deposits and inter-corporate deposits.

Increase in Working Capital

Increase in working capital is attributed to increase in inventories and trade receivables on account of inflationary impact on fuel inventory and higher sales, respectively.

Uses of Cash

Net Capital Expenditure

Your Company spent Rs5,831 crores on various capex during the year. This was primarily towards growth and maintenance capex as well as Waste Heat Recovery Systems ("WHRS").

Decrease in Investments

Your Company's liquid investment was used for repayment of borrowings.

Repayment of Borrowings

During the year, your Company repaid debt (on a net basis) of Rs360 crores.

The loan repayments have been done out of free cash flows that your Company has generated during the year. The aforesaid steps have resulted in an improved Net Debt/Equity ratio and Net Debt/EBITDA ratio.

Transfer to General Reserves

Your Company proposes to transfer an amount of Rs3,000 crores to General Reserves.


Your Directors recommend maintaining dividend of Rs38 per equity share of Rs10 each for the year ended 31st March, 2023, aggregating to Rs1,097.01 crores. The recommended dividend is in line with your Company's dividend policy, which is given in Annexure I of this Report and is also available on your Company's website.

In terms of the provisions of the Finance Act, 2020, dividend shall be taxed in the hands of shareholders at applicable rates of tax. Your Company shall therefore withhold tax at source appropriately.

Unclaimed dividend for the year ended 31st March, 2015, aggregating to Rs1.38 crores, has been transferred to the Investor Education and Protection Fund ("IEPF"). Your Company has also credited to the IEPF, set up by the Government of India, equity shares in respect of which dividend had remained unpaid/unclaimed for a period of seven consecutive years within the timelines laid down by the Ministry of Corporate Affairs, Government of India. Unpaid/unclaimed dividend for seven years or more has also been transferred to the IEPF, pursuant to the requirements under the Act.

Directors' Responsibility Statement

The audited accounts for the year under review are in conformity with the requirements of the Act and the Indian Accounting Standards. The financial statements reflect fairly the form and substance of transactions carried out during the year under review and reasonably present your Company's financial condition and results of operations.

Your Directors confirm that:

In the preparation of the Annual Accounts, applicable accounting standards have been followed along with proper explanations relating to material departures, if any.

• The accounting policies selected have been applied consistently, and judgements and estimates are made that are reasonable and prudent to give a true and fair view of the state of affairs of your Company on 31stMarch, 2023, and of the profit of your Company for the year ended on that date.

Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting frauds and other irregularities.

The Annual Accounts of your Company have been prepared on a going concern basis.

Your Company has laid down internal financial controls and that such internal financial controls are adequate and were operating effectively.

Your Company has devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Capital Expenditure Plan

Your Company's expansion program is progressing on schedule. It commissioned 12.4 MTPA of new grey cement capacity during FY23 at the following locations:

1.30 MTPA
1.80 MTPA
1.80 MTPA
1.90 MTPA
1.50 MTPA
1.30 MTPA
2.80 MTPA

Your Company also commissioned a 2.2 MTPA brownfield cement capacity at Patliputra, Bihar, in April 2023. Work on the next phase of growth of 22.6 MTPA announced during Q1 FY23 has already commenced. Civil work is in full swing at most sites. Commercial production from these new capacities is expected to go on stream in a phased manner by FY25/FY26.

Upon completion of these expansions, your Company's consolidated grey cement capacity will grow to 160.45 MTPA, reinforcing its position as the third-largest cement company in the world outside of China and by far the largest in India.

A third Birla White wall care putty plant was commissioned during the year at Nathdwara, Rajasthan. The existing two plants are situated at Kharia in Rajasthan and Katni in Madhya Pradesh.

Your Company now has a wall care putty capacity of 13 LTPA, further strengthening its position in the markets. Along with your Company's existing white cement manufacturing capacity in India and its investment in Ras Al Khaimah Company for White Cement and Construction Material, United Arab Emirates (UAE), your Company is strategically positioned to cater to the white cement and wall care putty market in the country.

Corporate Governance

Your Directors reaffirm their commitment to good corporate governance practices. During the year under review, your Company was compliant with the provisions relating to corporate governance. The compliance report is provided in the Corporate Governance section of this Report. The Auditor's Certificate on compliance with the conditions of corporate governance forming part of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") is provided in Annexure II of this Report.

Employee Stock Option Schemes ("ESOS")


The Nomination, Remuneration and Compensation Committee ("the NRC Committee") allotted 15,498 equity shares of Rs10 each of your Company upon exercise of stock options and Restricted Stock Units ("RSUs") by the grantees.


During the year, the NRC Committee:

granted 99,879 stock options at an exercise price of Rs6,130.70 per stock option, exercisable into the same number of equity shares of Rs10 each, and 48,089 RSUs at an exercise price of Rs10 each on 22nd July, 2022.

granted 39,963 stock options at an exercise price of Rs6,346.75 per stock option, exercisable into the same number of equity shares of Rs10 each, and 4,733 RSUs at an exercise price of Rs10 each on 27th October, 2021. vested 66,785 stock options and 11,957 RSUs to eligible employees, subject to the provisions of ESOS-2018, statutory provisions as may be applicable from time to time, and the rules and procedures set out by your Company in this regard.

Your Company transferred 28,803 equity shares during the year upon receipt of applications from some option grantees for the transfer of equity shares of your Company in their account from the Trust account. This also includes 131 equity shares pending for transfer for the year ended 31st March, 2023.

In terms of the provisions of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SEBI SBEB & SE Regulations") the details of the stock options and RSUs granted under the schemes are available on your Company's website https://

A certificate from the Secretarial Auditors on the implementation of your Company's ESOS will be available at the ensuing Annual General Meeting ("AGM") for inspection by the Members.

Share Capital

During the year, your Company allotted 15,498 equity shares of Rs10 each to option grantees upon exercise of stock options and RSUs in terms of ESOS-2013. As a result, the paid-up equity share capital of your Company stood at Rs2,88,68,63,450, comprising of 28,86,86,345 equity shares of Rs10 each.

Transfer of unclaimed dividend and shares – the details relating to unclaimed dividend and shares are given in the Corporate Governance section that forms part of this Report.


Your Company's constant endeavour to optimise operational procedures and build greater efficiencies continue to win recognition and prestigious awards. Here is a glimpse of some awards received during the year.

Thirteen of your Company's limestone mines received five-star ratings in 2021–22 from the Indian Bureau of Mines at their 75th anniversary celebrations. This is the highest number of five-star ratings awarded to any company in India across all sectors

Leader in ‘Climate Change' by the Carbon Disclosure Project ("CDP"), a global non-profit environmental organisation, for its 2022 CDP disclosure. Your Company received an ‘A-' score for implementing best practices and for taking concerted action on climate issues, securing a place in the leadership category

Sustain Labs Paris (SLP) in partnership with BW Businessworld has ranked your Company number one for Sustainability in the Infrastructure and Engineering Sector and 15th out of the Top 200 companies in India


Sustainability Award 2022' by The Energy and Resources Institute ("TERI") in association with the International Water Association ("IWA") and the United Nations Development Program ("UNDP") for the watershed project that aims to protect and restore community water structures in rural Andhra Pradesh, and uplifting the lives and livelihoods of the local population – Andhra Pradesh Cement

Three awards at ‘The EMVIES FY23'

• Gold – Ghar Ek Mauka Ek – Best Media Sponsorship

• Silver – Ghar Ek Mauka Ek – Best Integrated Campaign

• Silver – BGK 2.0 – Best Digital Strategy

The EMVIES Awards, considered the ‘Oscars' of media awards, introduced by The Advertising Club, India, honours significant and effective contributions in the field of media by advertisers and their media agency partners

Shared Service Centre (UKSC) awarded the Best Shared Services Team of the Year award at the 9th edition Shared Service Summit and Award 2022 organised by UBS Forums

Third prize for ‘Total Quality Excellence in the Indian Cement Industry' for excellence in total quality management for the three-year period of 2019–2022 from National Council for Cement and Building Materials ("NCCBM") – Aditya Cement

Three platinum and one silver award at the 45th Confederation of Indian Industry ("CII") National Kaizen competition, organised by the CII Institute of Quality – Rawan Cement

Top performer in Cement Sector in India PAT cycle – Rawan Cement

National Award for Excellence in Energy Management from CII – Reddipalayam Cement

National Award for Achieving Circular Economy in Indian Cement Industry by NCCBM – Reddipalayam Cement

Research and Development

Your Company's Research and Development ("R&D") efforts are geared for creating advance application value for customers by continuously discovering and incorporating novel features and functionalities in newer cement and concrete variants and exploring the technologies to achieve the net-zero carbon ambition. Enhancing customer satisfaction and aiding sustainability are guiding principles for the researchers at the R&D centre.

Devising solutions around themes for reducing water consumption for cement, improving clinker content of cement/concrete in construction, improved durability of concrete, improved environmental performance of cement and concrete products in terms of reduced greenhouse emissions and natural resource intensiveness, and increasing use of alternative raw material in cement manufacturing have resulted in significant progress in the development of various newer types of cements such as Limestone Calcined Clay Cement and other special-feature cement. Continuous product improvement through increased customisation, enhancing productivity through systematic and structured intervention, and new technology and advance material adoption are at the core of your Company's R&D centre.

The resources at the R&D centre are engaged in closely monitoring and incorporating the latest process technology developments, artificial intelligence ("AI")/ digital interventions, carbon reduction innovations, and advanced techniques in the field of cement–concrete technology in your Company's product offerings. With this objective in mind, your Company's R&D centre is committed to providing comprehensive technological support to its policy of promoting sustainable construction and development.

Customers, Quality, Sustainability, and Cost are the governing attributes of all R&D projects of your Company for achieving process optimisation and debottlenecking, raw material conservation, and adaptation of alternative fuels/raw materials to build on the circular economy. Towards this objective, your Company is actively developing alternatives for minimising the usage of mineral gypsum and the development of cost economic grinding additives and new generation chemicals while maintaining targeted product attributes and functionality.

Your Company's R&D Centre has:

Developed and filed for the patent of a new testing method to quickly identify and detect adulteration in the concrete for better customer service; Designed a chemical process of upgrading the kiln bypass dust for increased Calcium oxide percentage to reuse it in cement manufacturing; Two more IP generation opportunities in progress in the areas of converting cement manufacturing waste into value-added industrial projects and powder classification efficiency improvement;
Designed and developed value-added green concrete, significantly incorporating the use of a higher content of alternative cementitious materials from the industrial waste for enhancing the sustainability of concrete; Developed crack resistant concrete for industrial flooring applications; Developed 3D printable concrete formulation having excellent surface finish and completed the field trials with large construction companies.

The R&D centre has been granted patents for cement composition and a method of preparing thereof – a method of achieving zero discharge in ready-mix concrete ("RMC"). The R&D centre is working on ultra-high performance concrete formulations, which are typically required for infrastructure projects, the simulation and modelling of process equipment for performance optimisation and energy reduction, and using modern data analytics such as AI/machine learning ("ML") for optimising manufacturing processes as a part of digitalisation initiatives.

Your Company has accelerated its efforts of employing performance enhancers for blended multi-component cement to further reduce the clinker factor for lower carbon products while enhancing sustainability. Your Company is also part of global initiatives for converting the clinkerisation process using green electrical energy and has collaborated with Coolbrook, a transformational technology and engineering company, to explore the emissions from its


possibilities of the reduction of CO2

cement manufacturing operations.

Being a founding member of the Global Cement and Concrete Association ("GCCA"), your Company is also a key member in its R&D-focused consortia efforts of the Global Cement and Concrete Research Network. This was formed by the GCCA to accelerate global collaboration on cement and concrete innovation and is an important step in taking climate action. Some initiatives of the above capture using an innovative bi-phasic context include CO2 amine process and using an innovative low energy drier for utilising non-usable materials like wet pond ash and slag. The efforts are directed at adopting key trends driving the low-carbon emission initiatives for the Indian cement sector by actively participating in the mission with other partners. This helps your Company to keep abreast of innovation trends, the latest scientific developments in carbon footprint reduction, and identify potential routes for adopting newer ideas in sustainability objective with the following key areas of interest:

Pre and post carbon capture and its usage technologies
Exploration of green calcination technologies in the cement manufacturing process
Life-cycle analysis of concrete value chain
Enhancing the use of construction demolition wastes in RMC concrete
Increase use of waste material to reduce the dependency on the traditional fuels

Your Company is also closely engaged with Aditya Birla Science and Technology Company Private Limited ("ABSTCPL"), for developing technological solutions to model the cement process, devising predictive cement quality modelling and computational fluid dynamics (CFD) modelling, enhancing equipment productivity using engineering simulations, and devising special concrete products. ABSTCPL is the corporate research and development centre for the Aditya Birla Group, which caters to the long-term research needs of your Company through multi-disciplinary teams of expert scientists and engineers, who lead fundamental and applied research projects.


Your Company's approach to sustainability is aligned with global goals, such as the Paris Agreement, the United Nations' Sustainable Development Goals ("SDGs"), Science Based Targets initiative (SBTi), Net Zero Commitment, and the GCCA roadmap. Your Company has shifted from following traditional sustainability models to a more innovative and technologically experimental approach that is consistent with its vision of building a sustainable business while also balancing stakeholder expectations. Your Company adheres to international standards such as the International Finance Corporation ("IFC"), the Organisation for Economic Cooperation and Development ("OECD"), and the Global Reporting Initiative ("GRI"), and its Sustainable Business Framework is currently certified to 14 international standards.

Your Company's commitment to the World Business Council for Sustainable Development's ("WBCSD") Water, Sanitation, and Hygiene ("WASH") Pledge has resulted in better hygiene standards and inclusivity in terms of the construction of female and disability-friendly washroom facilities across units and stakeholder engagement initiatives to help gain insights into potential opportunities and business risks, to be leveraged for enhancing business models and strategies.

Your Company has integrated the findings of the Task Force for Climate-Related Financial Disclosures ("TCFD") into its risk management, business planning, and strategy, and has considered the impact of its carbon emissions on the environment as part of its evaluation and decision-making process. Your Company's performance in the S&P's Dow Jones Sustainability Index has improved significantly. It is ranked sixth in the Global Sectoral ranking of the S&P Global Dow Jones Sustainability World Index ("DJSI"). Your Company is the only Indian company in the Top 10 in the Construction Material sector for the second year in a row, aiding in benchmarking its performance against the world's best companies. Your Company is also featured in the S&P Global Sustainability Yearbook 2023. Only companies with a score within the Top 15% of their industry and having achieved an S&P Global Sustainability score within 30% of their industry's top-performing companies are listed in the Global Sustainability Yearbook. The adoption of new, cleaner, and greener technology together with a constant effort across all units and processes to become more energy efficient has bolstered your Company's commitment to delivering Net Zero Concrete by 2050, working with its value chain partners to accelerate decarbonisation. Your Company aims to achieve a 27% reduction in Scope 1 carbon intensity by

31stMarch, 2032, against the carbon emissions from March 2017, with assistance from SBTi. Your Company has also over-achieved on the target set by the Government of India for the first Perform, Achieve, and Trade ("PAT") cycle.

Your Company's total electricity requirement is to be met using renewable sources by 2050 as part of its RE100 commitment. With this aim, your Company continues to increase the use of renewable energy in its energy mix. Your Company has been striving to reduce consumption of fossil fuels by escalating their substitution with wastes from other industries. These efforts have resulted in 5.2% of its fuel requirements being met using alternative fuels and wastes. Your Company aims to be five times water positive by 2024, which means that it will replenish five times the amount of water it consumes.

As part of its continuing initiatives to ensure sustainable growth, your Company has completed Life Cycle Assessment ("LCA") studies for four of its products and has used these as input to identify hotspots over the value chain where the reduction of environmental impact is possible. More than 70 products in your Company's portfolio have GreenPro certification. Environment Product Declaration ("EPD") studies have also been conducted to uphold its product stewardship agenda. Your Company's embarkment on digital transformation has the potential to decouple emissions and resource use from economic growth as well as to make its operations safer and more reliable.


Your Company's digital solutions keep customers at the core of innovation to achieve a connected and smart ecosystem. With a deep understanding of its customers, the business teams learn fast and pivot rapidly, leveraging the best possible technologies to design state-of-the-art digital solutions.

These solutions provide an enhanced customer experience by empowering internal stakeholders and partners, improving efficiencies, and driving collaboration amongst teams.

Your Company has further enhanced existing solutions and launched new digital solutions for customers, partners, and employees.

Smart Manufacturing: Your Company continues to accelerate the adoption of digitalisation in its operations, encouraged by incremental value delivered through various initiatives. Your Company is investing in the setting up of cloud infrastructure as a key foundation for smart and connected factories.

Reliable Operations and Process Stability: Industry 4.0 technologies have empowered reliability teams by complementing existing preventive procedures and generating predictive and early alerts. Along with mechanisms to monitor and sustain process stability using combinations of software and AI solutions, your Company continues to beat reliability records across plant operations. Efforts on validating advanced algorithms to further improve process and equipment reliability are underway at your Company.

Energy Optimisation and Enhanced Productivity: Building on past efforts, your Company continued to scale the adoption of algorithmic advisory solutions to improve process stability and efficiency across all energy metrics, mainly focusing on increasing alternative fuel consumption and improving WHRS power generation, among others. Investments in expert control systems over the last few years have complemented these results. Other initiatives around digital mining management and optimisation are also underway to realise gains through better operational efficiencies.

Safer Operations: Each employee in your Company is a safety officer. The use of digital tools allows for improved effectiveness and collaboration of efforts on safety. Computer vision, augmented reality ("AR"), virtual reality ("VR"), and other sensors are being adopted or scaled to support safety objectives at the units.

Empowering Teams: The use of digital solutions for dynamic planning and the sourcing of packaging materials is improving central synergies and efficiency. An end-to-end fuel sourcing planning platform is helping take optimal decisions, which positively impacts the energy cost. Your Company's procurement team has adopted a ‘procure to pay' digital platform for engineering and packaging materials to drive efficiency, over and above current capabilities.

Speed, scale, customer convenience, and operational efficiency have been the focus areas of the digital transformation journey. In the last year, your Company has accelerated efforts to provide superior value to internal and external stakeholders by leveraging the best technologies with the successful roll-out and seamless adoption of the digital solutions by your Company's employees, customers, and service partners.

Customer First: Over the last two years, your Company has successfully completed the roll out of mobile app-based digital solutions to its channel partners and institutional customers. Through these apps, it has replaced several paper-based processes, helping to save time and improve the speed of operations for customers, partners, and internal teams.

Continuous enhancements carried out through the deep understanding of customers has enabled a high-level of adoption and use of these solutions.

UltraTech Trade Connect, a mobile app-based solution, provides unparalleled convenience to dealers and retailer network across the country. By providing a single interface it empowers channel partners to manage their day-today operations with ease. More than 90% of dealers across India, regularly use the app for engaging with your Company.

UltraTech Customer Connect, a mobile app-based solution, helps institutional customers to plan their site operations better through visibility of supplies and test certificates. The sites can provide electronic proof of delivery (ePOD) and access the finance documents, which help in streamlining the payment processes. More than half of your Company's institutional customers have adopted this solution.

Empowering Partners: Your Company counts on its drivers and transport partners as a crucial link for delivering superior experience to customers. Eye-to-track, a multilingual app launched for driver partners, has been well received among 50,000-plus drivers who have downloaded the app which conveniently connects them with customers.

Empowering Internal Stakeholders: Your Company's integrated information hub, Logistics Control Tower ("LCT"), provides a single version of the truth and end-to-end visibility to logistics. It has also been extended on mobile phones ("LCT Lite") to your Company's front-end sales teams for driving collaboration to improve logistics efficiencies.

These solutions, with unified flow of information between them, and functioning together as an integrated digital platform for the network of dealers, retailers, transporters, and drivers, is enabling your Company to be a customer-centric partner for its customers as well as the end consumers.

Your Company's Shared Services viz. UltraTech Knowledge Service Centre ("UKSC"), now in operations for around 4 years, has grown to a strength of 717 members processing ~1.9 million vendor invoices annually, maintaining 1.3 million customer/vendor master records, ensuring GST compliances for 26 states, and closing books of accounts for each of the 80+ units/zones every quarter to enable company-level consolidation for all of your Company's operations.

UKSC is built as a scalable and digitally enabled ‘Centre of Excellence' ("CoE"), which not only helps your Company to seamlessly absorb accounting work for any new cement capacity expansion, but also serve as a best-in-class knowledge hub to create future finance leaders. Representing at various Shared Service forums, UKSC has recently been recognised with an award for the "Best Shared Service Team". The digital adoption has been recognised by the Aditya Birla Group IT and UKSC has won the "IT Digital Showcase 2.0 Award" for the Project -.SAP-AFC Implementation.

Continuing the collaboration with the CIO's and business finance team, UKSC is currently adopting further digital initiatives for people, process, and compliance which will not only make it more efficient but also create business value by providing actionable insights to business leaders on cost, working capital and other levers to optimise the ROCE. Creating an Analytics CoE for the future is in line with this. This digital journey is expected to further accelerate in the coming quarters, yielding significant benefits for your Company and its stakeholders.

Human Resources

Your Company continued to focus on employee core connect, engagement, learning, and development to build a workplace that is safe, engaging, and productive. Your Company undertook digitalisation of all talent management processes for regular communication. All the employees of your Company were presented with various learning opportunities to enhance career growth. Learning and development teams ensured the training of employees and leveraged virtual mediums to organise learning sessions for them. Wellness sessions that dealt with topics related to safety and health helped create awareness among employees and their families about key areas related to their well-being.

Throughout the year, employees remained connected through planned events such as seminars, learning programs, and self-learning modules.

Your Company's employee strength stood at 22,916 on 31stMarch, 2023 (compared to 21,921 in 2022).


Your Company accords the utmost importance to precious human life. Hence, the safety of people associated with the business remains the fulcrum of your Company's operations. To further boost the effectiveness of the already well-established safety management system, your Company took a call to bring an emotional element into it. Consequently, numerous interventions were launched and driven under an organisation-wide campaign coined ‘Suraksha, dil se…' ("Safety by heart"), encompassing almost all vital elements that constitute organisational safety culture. Positive outcomes are reflected in the lagging indicators – the best-ever Lost Time Injury Frequency Rate ("LTIFR") of -0.10 was achieved, a reduction of 28% compared to the previous best.

Under the aegis of ‘Suraksha, dil se…', various interventions were driven with an aim to make safety a way of life. These were related to four major components of the safety management system: setting objectives and reviewing them through leaders connect, building competence, facilitating implementation, and verifying compliance.

Setting Objectives and Reviewing Them Through Leaders Connect

Fatal risk prevention elements (working at height, conveyor safety, hot material safety, and electrical safety) were included in the annual safety key performance indicators ("KPIs"). There has been a positive shift in identifying and reporting unsafe conditions, acts, and near misses related to these four fatal risk prevention elements.

Fortnightly safety reviews were carried out by the Head of Manufacturing. Senior managers were randomly selected from three units, who connected every week and had interactions on various safety KPIs of their respective unit.

‘Pratibimb' – weekly reviews were carried out by Cluster Heads through walk-through inspections done by employees across units. 576 employees connected through 144 sessions during the year.

The Unit Apex committee, headed by the Unit Head, reviews monthly the effectiveness of six subcommittees' functioning on: i) standards and procedures, ii) safety observations, iii) training and capability building, iv) incident investigation, v) contractor safety management, and vi) logistics safety. Representatives of unit-level subcommittees apprise status at the respective cluster-level subcommittee meetings, which are chaired by the Cluster Heads. These meetings are held once every four months, where decisions are made to act based on inputs/review outcomes. Finally, the Occupational Health and Safety ("OHS") Board, chaired by the Managing Director and Head of Manufacturing, reviews organisational safety performance once every two months, and a further course of action is communicated across units.

Building Competence

Around 750,000 man-hours of safety training were organised across units during the year.

A brief description of the various safety training elements are as follows:

Standard Champions training: to build a pool of competent in-house resource as trainers, 500 employees across all units were trained on 18 safety standards through the ‘Standard Champions training' programme.

VR-enabled safety training on 30 modules was organised for contract workmen and employees at units to ensure that job-specific immersive training is provided to each contract workman before deploying them to the job. VR puts learners in places and situations they are likely to encounter on the job and allows them to experience how their actions affect outcomes, all in a safe environment. Around 12,000 persons were trained during the year.

E-learning modules on critical processes (such as use of a coal mill or boiler, operations involving the likelihood of hot material exposure, and the management of change) were developed and uploaded to the learning management system ("LMS") platform. The system was institutionalised so that all employees involved in these operations needed to mandatorily get themselves qualified through tests after going through these courses. Around 5,000 employees completed these courses during the year.

Virtual training sessions in Hindi as well as regional languages were organised for the contractual workforce on four fatal risk prevention elements: working at height, conveyor safety, electrical safety, and hot material safety. Around 14,000 contractual workers covered so far.

544 persons (employees and contract workers) engaged in rail yard related activities across units have been trained on rail safety by an external expert.

Classroom safety training has been imparted to 1,800 contractor's supervisors across all units.

Facilitating Adherence to Safety

Monthly safety campaign, driven by identified themes (based on analysis of past incidents): Multiple activities/events are organised and supported by a variety of mediums (3D animation video, creative posters, training through virtual platform etc.) to reach out to all.

Safety toll-free number (available 24/7): As a deterrent against safety violations, an exclusive safety toll-free number has been made available with communication to every person (employee/contract worker) so that they can act as whistleblowers to save lives. The concerns voiced are addressed, keeping the caller's identity anonymous.

60 seconds to think: This involves seven questions that have to be asked by each individual before initiating any work. They must sign this and submit it along with Permit-to-Work ("PTW") to the custodian. It also facilitates the ability of any contract worker to say ‘no' if they feel they are not safe to execute the work or are not convinced that the conditions to execute the work may cause an accident.

Safety behaviour observation: Safety observation—a structured, pro-active six-step process—is in place to achieve positive change in people's behaviour towards safety in the workplace. It aims to i) recognise and reinforce positive safety behaviour, ii) identify and correct behaviour at risk, and iii) engage in conversation regarding safety concerns or issues. During the year, over 4,00,000 observations were reported through this across units.

Digitisation of walk-through inspection (WTI): A latitude-longitude-based unique QR code was generated for each of around 50 locations of a unit. By scanning the specified section's QR code, the user can view the WTI checklist of the section and report findings by using the ‘speech-to-text' feature. Around 300,000 findings were reported through WTI and closed during the year across all units.

20 Pictorial Standard Operating Procedures ("SOPs") in Hindi – with less text and more visuals displayed at relevant locations for contractual workers to easily understand and follow.

30 3D-animated videos in English and Hindi on past serious incidents are shown at units for easy understanding by employees and contractual workers about how and why those happened, to prevent recurrence.

A Behavioural Science-Based Safety ("BSBS") program was launched to address the psychological issue of contractual workforce towards safety.

With the on-going capacity expansions, safety at project sites pose their own challenges on account of timelines for execution and contract workmen attrition. To give more thrust towards safe execution of projects, multilayer monitoring was introduced which is over and above the existing safety management practices at your Company. Apart from respective project HRC and Apex committees, safety experts were deployed at the sites. Additionally, expert rigger and scaffolding experts were placed at each project site to support safe execution.

Verifying Compliance

Assurance: An independent safety assessment was carried out by a third-party expert agency to evaluate the degree of compliance to 17 safety standards (as applicable) across of your Company. The result of this assessment has been shared with units to enable them take corrective actions. The minimum score improved from 53% in FY22 to 72% in FY23.

Safety audit: Around 4,000 observations reported through first party safety audit (FPSA) across units were closed. In addition, 8,000 contractor field safety audits were carried out across units during the year. Safety audits at 62 RMC plants by safety professionals of nearby manufacturing units identified 1,825 findings, all of which were subsequently closed.

- Contractor Connect Initiative': Unit Heads/Function Heads engage through weekly sessions with contractors and workers to verify adherence to safety norms while at work. This has been continued for 84 weeks so far since launch.

Corporate Social Responsibility

In terms of the provisions of Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of

Directors of your Company has constituted a Corporate Social Responsibility ("CSR") Committee, chaired by Mrs. Rajashree Birla. Other Members of the Committee are Mrs. Sukanya Kripalu, Independent Director, and Mr. K. C. Jhanwar, Managing Director. Dr. (Mrs.) Pragnya Ram, Group Executive President, CSR, Legacy, Documentation and Archives, is a permanent invitee to the Committee. Your Company has in place a CSR Policy, which is available at

Your Company's CSR activities are focused on social empowerment and welfare, infrastructure development, sustainable livelihood, healthcare, and education. Various activities across these segments have been initiated during the year around its plant locations and adjacent villages.

During the year, your Company spent Rs115.99 crores on CSR activities and set off Rs18.60 crores from the excess spent during FY21, aggregating to Rs134.59 crores, resulting in 2% of the average net profits of your Company during the last three financial years. A report on CSR activities is provided in Annexure III, which forms part of this Report.

Subsidiaries, Joint Ventures, and Associate Companies

The audited financial statements of your Company's subsidiaries and joint ventures viz. Harish Cement Limited, Gotan Lime Stone Khanij Udyog Private Limited, Bhagwati Lime Stone Company Private Limited, UltraTech Nathdwara Cement Limited ("UNCL"), UltraTech Cement Middle East Investments Limited ("UCMEIL"), UltraTech Cement Lanka (Private) Limited, and their related information are available for inspection on your Company's website. PT UltraTech Mining Indonesia and PT UltraTech Investments Indonesia were struck off as subsidiaries with effect from 14th June, 2022. UCMEIL entered into a Share Sale and Purchase Agreement with Seven Seas Company LLC., Oman for acquisition of 70% equity shares in Duqm Cement Project International, LLC. Oman ("Duqm"). Duqm has allotment of limestone mines and other infrastructure that would help your Company secure limestone supplies for its coastal-based plants. The Board of Directors approved a Scheme of Amalgamation of UNCL (a wholly-owned subsidiary of your Company) and its wholly-owned subsidiaries viz. Swiss Merchandise Infrastructure Limited and Merit Plaza Limited with your Company. The Appointed Date of the Scheme is 1st April, 2023. The transaction is subject to the approval of National Company Law Tribunal, Mumbai and Kolkata and other regulatory authorities as may be required.

Any Member who is interested in obtaining a copy of the audited financial statements of your Company's subsidiaries may write to the Company Secretary. In accordance with the provisions of Section 129(3) of the Act read with the Companies (Accounts) Rules, 2014, a report on the performance and financial position of each of the subsidiaries, joint venture, and associate companies is provided in Annexure IV of this Report.

Particulars of Loan, Guarantee, and Investment

Details of Loan, Guarantee, and Investment covered under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, are given in the Notes forming part of the standalone financial statements.

Energy, Technology, and Foreign Exchange

Information on the conservation of energy, technology absorption, and foreign exchange earnings and outgo, required to be disclosed pursuant to Section 134(3)(m) of the Act read with the Companies (Accounts) Rules, 2014, is given in Annexure V of this Report.

Particulars of Employees

Disclosures relating to remuneration and other details as required under Section 197(12), read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given in Annexure VI. In accordance with the provisions of the aforementioned section, the names and other particulars of employees drawing remuneration in excess of the limits set out in the aforesaid rules form part of this Report. However, in line with the provisions of Section 136(1) of the Act, the Report and Accounts as set out therein, are being sent to all Members of your Company, excluding the aforesaid information. Any Member who is interested in obtaining these particulars may write to the Company Secretary.

Business Responsibility and Sustainability Report

The Securities and Exchange Board of India ("SEBI"), by its circular dated 10th May, 2021, introduced new sustainability-related reporting requirements to be reported in the specific format of the Business Responsibility and Sustainability Report ("BRSR"). The BRSR forms part of this Report.

Contract and Arrangement with Related Parties

Related party transactions entered into by your Company during the financial year were completely on an arm's length basis and in the ordinary course of business. There were no material transactions with any related party, as defined under Section 188 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014 All related party transactions have been approved by the Audit Committee of your Company and reviewed by it on a periodic basis. The policy on Related Party Transactions, as approved by the Audit Committee and the Board, is available at corporate-governance#policies.

The details of contracts and arrangements with related parties of your Company for the financial year ended 31stMarch, 2023, is provided in Note No. 38 to the standalone financial statements of your Company.

Risk Management

Your Company recognises that every business encompasses risks that need timely intervention and management. To achieve the ambitious business goals in a challenging and dynamic environment, your Company is committed to proactively managing risks. While risks can never be eliminated, effective risk management can help in avoiding, mitigating, transferring, or accepting the associated impacts of risks.

At your Company, the Risk Management and Sustainability Committee ("RMS Committee") is responsible for overseeing your Company's risks. It reviews the Enterprise Risk Management Framework, analyses risks in depth, and defines mitigation actions where necessary. Your Company aims to assess and prioritise risks based on their significance in terms of impact and likelihood, considering the business environment, operational controls, and compliance procedures.

Your Company has identified several key risks, including economic environment and market demand; inflation and costs of production; legal and compliance; financial; environment; climate and sustainability; information technology; and talent management. Your Company considers the risk horizons, which includes long-term strategic risks, short to medium-term risks, and single events. The risks are analysed based on their likelihood and impact to determine the appropriate risk management strategy.

Key Business Risks identified by your Company:

Economic Environment and Market Demand

The demand for construction material is driven by the economic growth in the country. Economic slowdown and subdued infrastructural development might lead to a slowdown in construction projects, thus leading to a reduction in cement consumption in the country. In a scenario where incremental capacity addition exceeds incremental cement demand, the government's push for infrastructure and housing will aid the growth in cement consumption.

Given that the cement industry in India is an aggregation of small and large companies, the risk of protecting market share in such environment is optimal for your Company. With the expanding capacities of existing players and the emergence of new entrants, competition is a sustained risk. To mitigate this, continuous endeavours to enhance brand equity through innovative marketing activities, enhancement in the product portfolio, and value-add services have been the thrust areas for your Company. The engineering expertise of your Company and its emphasis on quality also act as a significant counter measure to the risk of market fluctuations.

Inflation and Cost of Production

Your Company faces the risk of inflation and price fluctuations in the cost of coal, pet coke, power, and other fuels, since these are market-driven. The cement industry is extremely energy intensive, and changes in fuel prices can significantly impact production cost. To de-risk, your Company has established specific policies of long-term contracts, and it continuously optimises its fuel mix and energy efficiency, while exploring the use of alternative fuels.

The procurement of raw materials at an economical cost or of suitable quality faces a high degree of inflationary certainty. Your Company mitigates this risk through the establishment of exhaustive policies for procurement of specific raw materials and stores those which are amenable to just-in-time inventories.

Limestone is the primary raw material required to produce cement, so its continuous and long-term availability is critical, particularly under the dynamic regulatory environment. Your Company currently possesses sufficient limestone reserves. However, securing additional reserves is critical to address your Company's expansion plans. Apart from the preservation and extension of existing reserves, a range of measures, including strategic sourcing and changing input-mix, are adopted by your Company to mitigate the risk of unavailability of limestone.

Legal and Compliance

This risk relates to any inadvertently violated laws covering business conduct. The country's regulatory framework is ever-evolving, and the risk of non-compliance and penalties may increase for your Company, leading to reputational risks. A comprehensive risk-based compliance programme, involving inclusive training and adherence to the Code of Conduct, is thus institutionalised by your Company. As a step to mitigate the legal and compliance risk, your Company's management encourages its employees to place their reliance on professional guidance and opinions to discuss the impact of any changes in laws and regulations to ensure total compliance. Periodic and ad hoc reporting to various internal committees for oversight ensures the effectiveness of such a programme.


This comprises the risk of exposure to fluctuations in interest rates, foreign exchange rates and commodity prices. The risk management strategy is to identify the risk exposure, measure and evaluate the financial impact, and decide on steps to mitigate the risks together with ensuring regular monitoring and reporting.

With the objective of minimising risks arising from the uncertainty and volatility of foreign exchange rate fluctuations, an elaborate financial risk management policy is followed for every transaction undertaken in foreign currency. Your Company's policies to counter such risks are reviewed periodically and constantly aligned with the financial market practices and regulations.

Changing laws, rules, regulations, and standards relating to accounting, corporate governance, public disclosure, and listing regulations are generating newer and unforeseen risks for companies. The new or changed laws, regulations, and standards may lack precedence and are subject to varying interpretations. Their application in practice may evolve as new guidance is provided by regulatory and governing bodies. Thus, your Company maintains a high standard of corporate governance and public disclosure to de-risk itself from such dynamic regulatory changes.


Environmental risk pertains to the harm caused to the environment by pollution resulting from waste discharge and greenhouse gas emissions. To prevent this, your Company's operating units are equipped with Continuous Emission Monitoring Systems ("CEMS") in the major stacks and monitored in real-time by the Central Pollution Control Board ("CPCB") and State Pollution Control Boards ("SPCBs"). The units have been in compliance with the regulations of the Ministry of Environment, Forest and Climate Change ("MoEF&CC"), and no major deviation has been observed.

In addition to CEMS, third-party environment monitoring is regularly carried out by laboratories which are approved by the National Accreditation Board for Testing and Calibration Laboratories ("NABL"), and the results are further substantiated by monitoring carried out by SPCBs. Regular measures are being taken to maintain the performance efficiency of Pollution Control Equipment at all the units. This year, the performance efficiency study of Air Pollution Control Devices ("APCDs") in the units was carried out by NCCBM. Internal environmental audits are also conducted to ensure that the emissions are kept within or lower than the limits for the APCDs on a regular basis.

For better control of fugitive emissions, your Company has initiated an emission inventory dispersion modelling study for one of its units by the Indian Institute of Technology, Mumbai. Your Company has also constructed covered sheds for various raw materials and fuels at some units and concreted new roads at others.

Climate and Sustainability

Your Company has analysed climate change-related risks in its operations, including the physical and transition risks it entails, which are aligned with the Task Force on

Climate-related Financial Disclosures ("TCFD") framework. The following climate-related risks have been identified:

Physical Risks

Acute physical risks arising from longer-term changes in climate patterns causing damage to assets or supply chain disruption, such as floods, heat waves, cyclones, and droughts.

Chronic physical risks such as variations in temperature, precipitation patterns, and water stress.

Transitional risks emerging from the transition to low-carbon business pathways that involve regulatory changes, technology, and market changes to address mitigation and adaptation requirements related to climate change.

Your Company has developed a risk mitigation strategy against each climate risk, summarised as follows; Acute physical risks: Your Company diligently implements disaster management plans, health and safety protocols, and adequate communication protocols during extreme weather events to ensure site safety and minimise the impact on the workforce. Annual weather forecasts are being considered in global supply chain decisions to mitigate the risk of delays in sourcing fuels and machinery due to natural calamities. Insurance coverage is in place to protect against damages to business assets or loss of materials in warehouses or transit due to extreme weather events.

Chronic physical risks: Your Company has proactively installed rainwater harvesting systems across sites. In addition, at several of the manufacturing sites, Zero Liquid Discharge ("ZLD") plants have been installed to enable the reuse of 100% treated water within the sites. As a result, your Company is 4.1 times water positive currently.

Measures to mitigate the risks of heat waves have been introduced across sites, making your Company resilient to such risks. Some such measures include minimal work in mid-day hours in warehouses or outdoor areas during peak summer days, flexible work hours with early morning and late evening shifts to avoid exposure to heat waves, and compliance to the WASH Pledge (ensuring the availability of drinking water).

Transitional risks: Emerging climate policies and the world carbon market economy could significantly impact companies in the future due to their effects on the supply chain, physical risk, shifting customer preferences, and the transition to a low-carbon economy. Your Company has analysed physical and transitional risks using a scenario-based approach and is aligned with the Representative Concentration Pathway ("RCP"), ETP B2DS, and IPCC 1.5-degree scenarios. Your Company's resilience has been evaluated under scenarios, and potential pathways for decarbonisation have been considered to ensure compliance with policy mechanisms. Some key risks that may have financial implications for the Company are the introduction of carbon pricing in India; the financing community is expected to strengthen its climate-related financing mechanism; non-compliance to meet 1.5 _C pathway requirements; maturity and viable low carbon technology adoption, among other developments. Your Company has committed to achieving net zero by 2050 and is capable of adapting to new risks arising from climate policy changes by focusing on the green energy transition, enhancing the circular economy, diversifying its low-carbon product portfolio, and participating in new technology development and piloting with global companies in association with the GCCA.

Information Technology

This comprises risks related to Information Technology ("IT") systems, such as data integrity and physical assets. Your Company deploys IT systems, including ERP, SCM, Data Historian, and Mobile Solutions, to support its business processes, communications, sales, logistics, and production. Risks could primarily arise from the unavailability of systems and/or loss or manipulation of information. To mitigate these risks, your Company uses backup procedures and stores information at two different locations. Systems are upgraded regularly with the latest security standards. For critical applications, security policies and procedures are updated periodically, and users are educated on adherence to the policies to eliminate data leakages. Your Company is also in the process of beefing up information security around Plant Production Equipment.

Talent Management

Your Company's growth has been driven by its ability to attract and retain top-quality talent while effectively engaging them in the right jobs. The risks in talent management are mitigated by following a policy of being an employer of choice and instilling a sense of belonging. Specialised training courses are adopted to enhance and reskill employees to prepare them for future roles and create a talent pipeline.

Geopolitical Tension

The rising fuel prices in the wake of geopolitical tensions have had an adverse impact on the cost of manufacturing cement owing to increased raw material, fuel, and energy costs. For your Company's business, raw material, fuel, and logistics account for a major share of the manufacturing cost. The anticipated rise in the procurement of raw materials and high consumption of energy is likely to lead to the need to prioritise local dependence for raw material and energy fulfilment in order to mitigate the disruption caused due to such global geopolitical tension.

Internal Control Systems and their Adequacy

Your Company has put in place adequate internal control systems that are commensurate with the size of its operations. Policies and procedures related to internal control systems are designed to ensure sound management of your Company's operations, safekeeping of its assets, optimal utilisation of resources, reliability of its financial information, and compliance. Clearly defined roles and responsibilities have been institutionalised, and systems and procedures are periodically reviewed to keep pace with the growing size and complexity of your Company's operations.


Retiring by rotation and continuing as Director

In accordance with the provisions of the Act and Articles of Association of your Company, Mrs. Rajashree Birla (DIN: 00022995) retires by rotation, and being eligible, offers herself for re-appointment.

Further, in terms of Regulation 17(1A) of the Listing Regulations, no listed Company shall appoint or continue the appointment of a Non-executive Director, who has attained the age of 75 years, unless a special resolution is passed to that effect. Mrs. Birla having attained the age of 75 years, resolution seeking her re-appointment and continuation as Director forms part of the Notice convening the AGM.

Meetings of the Board

Your Company's Board of Directors met six times during the year to deliberate on various matters. The meetings were held on 6th April, 2022; 29th April, 2022; 2nd June, 2022; 22nd July, 2022; 19th October, 2022; and 21st January, 2023. Additional details relating to the meetings of the Board of Directors are provided in the Report on Corporate Governance, which forms part of this Report.

Your Company has the following Board-level Committees, established in compliance with the requirements of the business and relevant provisions of applicable laws and statutes:

Audit Committee

Nomination, Remuneration, and Compensation Committee

Stakeholders' Relationship Committee

Corporate Social Responsibility Committee

Risk Management and Sustainability Committee

Finance Committee

Details with respect to the composition, terms of reference, number of meetings held, etc. of the above Committees are included in the Report on Corporate Governance, which forms part of this Report.

Independent Directors

Your Company's Independent Directors have submitted requisite declarations confirming that they continue to meet the criteria of independence as prescribed under Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations. The Independent Directors have also confirmed that they have complied with the provisions of Schedule IV of the Act and your Company's Code of Conduct.

Your Company's Board is of the opinion that the Independent Directors possess requisite qualifications, experience, and expertise in industry knowledge; innovation; financial expertise; information technology; corporate governance; strategic expertise; marketing; legal and compliance; sustainability; risk management; human resource development and general management, and they hold the highest standards of integrity. All Independent Directors of your Company have registered their name in the data bank maintained with the Indian Institute of Corporate Affairs, Manesar, in terms of the provisions of the Companies (Appointment and Qualification of Directors) Rules, 2014.

Formal Annual Evaluation

The evaluation framework for assessing the performance of your Company's Directors comprises of contributions at meetings and strategic perspective or inputs regarding the growth and performance of your Company, among others. The NRC Committee and the Board have laid down the manner in which formal annual evaluation of the performance of the Board, its Committees, and individual Directors are to be made. Separate evaluation forms are circulated to individual Directors for evaluation of the Board; its Committees; Independent Directors; Non-Executive Directors; Executive Directors; and the Chairman of your Company. The process broadly comprises:

Board and Committee Evaluation

Evaluation of the Board as a whole and the Committees is done by individual Directors. These are collated for submission to the NRC Committee and feedback to the Board.

Independent/Non-Executive Directors Evaluation

Evaluation done by Board members, excluding the Director who is being evaluated, is submitted to the Chairman of your Company, and individual feedback is provided to each Director. The evaluation of the Chairman/Executive Director, as done by the individual Directors, is submitted to the Chairman of the NRC Committee and subsequently to the Board. The evaluation framework focuses on various aspects of the Board and Committees such as review, timely information from management, and others. Performance of individual Directors are categorised into Executive, Non-Executive, and Independent Directors and is based on parameters such as contribution, attendance, decision-making, action-orientation, external knowledge, etc.

A brief summary of the evaluation exercise

The Board as a whole functions cohesively. The

Committees function well in their respective areas, and the recommendations of the Committees are considered and have been accepted by the Board. The Directors bring to the table their knowledge and experience. Independent Directors are rated high in understanding your Company's business and expressing their views freely during deliberations. The Non-Executive Directors score well in all aspects. Executive Directors are action-oriented and good in implementing Board decisions. The Chairman leads the Board effectively and encourages active participation and contribution from all the Board members.

The details of the familiarisation programme for Independent Directors are available at https://www.

Policy on Appointment and Remuneration of Directors and Key Managerial Personnel and Remuneration Policy

Your Company's Directors are appointed/re-appointed by the Board on the recommendations of the NRC Committee and approval of the shareholders.

In accordance with the Articles of Association of your Company, provisions of the Act, and the Listing Regulations, all Directors, except the Executive Directors and Independent Directors, are liable to retire by rotation and, if eligible, offer themselves for re-appointment. The Executive Directors are appointed for a fixed tenure and are not liable to retire by rotation. The Independent Directors can serve a maximum of two terms of five years each, and their appointment and tenure are governed by provisions of the Act and the Listing Regulations.

The NRC Committee has formulated the remuneration policy of your Company, which is provided in Annexure VII of this Report.

Key Managerial Personnel

In terms of the provisions of Section 203 of the Act, Mr. K. C. Jhanwar, Managing Director; Mr. Atul Daga, Whole-time Director and Chief Financial Officer; and Mr. Sanjeeb Kumar Chatterjee, Company Secretary, are the Key Managerial Personnel of your Company.

Audit Committee

The Audit Committee comprises Mr. S. B. Mathur, Mr. Arun Adhikari, Mrs. Alka Bharucha, and Mr. K. K. Maheshwari, majority of whom are Independent Directors, with Mr. S. B. Mathur being the Chairman. Mr. K. C. Jhanwar, Managing Director, and Mr. Atul Daga, Whole-time Director and Chief Financial Officer, are permanent invitees. Further details relating to the Audit Committee are provided in the Report on Corporate Governance, which forms part of this Report. During the year under review, all recommendations made by the Audit Committee were accepted by the Board.

Vigil Mechanism / Whistle Blower Policy

Your Company has in place a vigil mechanism for Directors and employees to report instances and concerns about unethical behaviour, actual or suspected fraud, or violation of your Company's Code of Conduct. Adequate safeguards are provided against victimisation of those who avail of the mechanism, and direct access to the Chairman of the Audit Committee, in exceptional cases, is provided to them.

The vigil mechanism / whistle blower policy is available at

Significant and Material Orders passed by the Regulators

Your Company had filed appeals against the orders of the Competition Commission of India ("CCI") dated 31stAugust, 2016 (penalty of Rs1,449.51 crores) and 19thJanuary, 2017 (penalty of Rs68.30 crores). Upon the National Company Law Appellate Tribunal ("NCLAT") disallowing its appeal against the CCI order dated 31stAugust, 2016, your Company filed an appeal before the Hon'ble Supreme Court, which has, by its order dated 5thOctober, 2018, granted a stay against the NCLAT order. Consequently, your Company has deposited an amount of Rs144.95 crores, equivalent to 10% of the penalty of

Rs1,449.51 crores. Your Company, backed by legal opinions, believes that it has a good case in both the matters, and accordingly, no provision has been made in the accounts.


Statutory Auditors

Pursuant to the provisions of Section 139 of the Act and the Companies (Audit and Auditors) Rules, 2014, M/s. BSR & Co. LLP, Chartered Accountants, Mumbai (Registration No: 101248W/W-100022) and M/s. KKC & Associates LLP, Chartered Accountants (formerly Khimji Kunverji & Co. LLP), Mumbai (Registration No: 105146W/W100621) have been appointed as Joint Statutory Auditors of your Company for a second term of five years until the conclusion of the 25th and 26th AGM respectively. In accordance with the provisions of the Act, the appointment of Statutory Auditors is not required to be ratified at every AGM.

The observations made in the Auditor's Report are self-explanatory and therefore, do not call for any further comments under Section 134(3)(f) of the Act.

Cost Auditors

The Cost Accounts and records as required to be maintained under Section 148(1) of the Act are duly made and maintained by your Company.

In terms of the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors of your Company have, on the recommendation of the Audit Committee, appointed M/s. D. C. Dave & Co., Cost Accountants, Mumbai and M/s. N. D. Birla & Co., Cost Accountants, Ahmedabad, to conduct the Cost Audit of your Company for the financial year ending 31st March, 2024, at a remuneration as mentioned in the Notice convening the AGM.

As required under the Act, the remuneration payable to the Cost Auditors must be placed before the Members at a general meeting for ratification. Hence, a resolution relating to the same forms part of the Notice convening the AGM.

Secretarial Auditors

In terms of the provisions of Section 204 of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed M/s. Makarand M Joshi & Co., Company Secretaries, as Secretarial Auditors for conducting a Secretarial Audit of your Company for the financial year ended 31st March, 2023.

The report of the Secretarial Auditor is provided in Annexure VIII, which does not contain any qualification, reservation, or adverse remark.

Compliance with Secretarial Standards

Your Company is compliant with the Secretarial Standards specified by the Institute of Company Secretaries of India ("ICSI"). Your Company has complied with all applicable provisions of Secretarial Standard-1 and Secretarial Standard-2 relating to ‘Meetings of the Board of Directors' and ‘General Meetings' respectively, issued by the ICSI.

Annual Return

In terms of the provisions of Section 92 and Section 134 of the Act read with Rule 12 of the Companies (Management and Administration) Rules, 2014, the Annual Return is available at financials.

Other Disclosures

No material changes and commitments affected the financial position of your Company between the end of the financial year and the date of this Report.

Your Company has not issued any shares with differential voting rights.

There was no revision in the financial statements.

There has been no change in the nature of the business of your Company.

Your Company has not issued any sweat equity shares.

Disclosures as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act"):

Your Company has adopted zero tolerance for sexual harassment in the workplace and has formulated a policy on the prevention, prohibition, and redressal of sexual harassment in the workplace in line with the provisions of the POSH Act and the rules framed thereunder, for prevention and redressal of complaints of sexual harassment in the workplace. Your Company has complied with provisions relating to the constitution of the Internal Committee under the POSH Act. During the year under review, your Company received six complaints of sexual harassment, of which for two complaints, there was no evidence of harassment, and two complaints have been resolved. Investigations are continuing for the remaining two complaints.

Cautionary Statement

Statements in the Directors' Report and the Management Discussion and Analysis describing your Company's objectives, projections, estimates, expectations, or predictions may be ‘forward-looking statements' within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to your Company's operations include global and Indian demand-supply conditions, finished goods prices, feed stock availability and prices, cyclical demand and pricing in your Company's principal markets, changes in government regulations, tax regimes, economic developments within India and the countries within which your Company conducts business, geopolitical tensions, risks related to an economic downturn or recession in India, and other factors such as litigation and labour negotiations. Your Company is not obliged to publicly amend, modify, or revise any forward-looking statements on the basis of any subsequent development, information, or events, or otherwise.


Your Directors express their deep sense of gratitude to the banks, financial institutions, stakeholders, business associates, and central and state governments for their support, and look forward to their continued assistance in the future. Your Directors thank employees for their contribution and applaud them for their superior levels of competence, dedication, and commitment to your Company.

For and on behalf of the Board
Kumar Mangalam Birla
(DIN: 00012813)
28th April, 2023


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