These factors indicate immense growth potential for the cement sector, driven by robust demand in the real estate sector, the Government’s focus on infrastructure spending and anticipated growth in private sector capital expenditures. We are on the cusp of a promising era filled with opportunities and expansion. Despite a number of challenges, your Company has demonstrated resilience and adaptability, positioning us well to take advantage of favourable market conditions and pursue – Growth with Resilience.

Although India is the second-largest cement producer globally, its per capita consumption remains relatively low. However, this presents us with a vast array of opportunities for exponential growth in the future. The Government has intensified its focus on physical infrastructure through various programs and initiatives such as “Bharatmala” for road connectivity, “Sagarmala” for port infrastructure, electrification projects, railways upgradation, and the operationalisation of new airports and airline routes under “UDAN”. Until FY 2022-23, around 80 lakh^# houses were estimated to be completed under the “Pradhan Mantri Awas Yojana – PMAY” (Rural and Urban) accompanied by an enhanced outlay of 66% to over ₹79,000 crores.

These efforts aim to improve the overall infrastructure landscape in the country.

Nuvoco continues to be the fifth-largest cement group in India and one of the leading players in East India in terms of capacity. We are recognised as one of the fastest-growing cement companies in the country. Our Company is committed to its mission of being a Leading Building Materials Company Delivering Superior Performance through an exhaustive business portfolio comprising Cement, Ready-Mix Concrete (“RMX”) and Modern Building Materials (“MBM”). With a wide range of products and solutions, we are well poised to meet the needs of individual home builders as well as institutional infrastructure development.

Our cement business maintains one of the highest cement-to-clinker ratio in the industry at 1.8, emphasising blended cement. By focusing on innovation and premium raw materials, we have successfully launched superior cement products like Duraguard Xtra F2F and Concreto Uno. Although the cement sector may face margin pressure due to volatile costs, demand is anticipated to remain strong. Your Company is well positioned in the market by utilising premium-grade raw materials and providing innovative and best-in-class products. Our RMX and MBM businesses have also performed remarkably well. The RMX business experienced 24% increase in revenue, driven by premium and new products. We have more than 50 plants pan-India and an all-women-led RMX plant in Guwahati. The MBM business showed a significant increase in its share of revenues. Overall, we remain committed to maximising shareholder value and seizing a favourable business environment.

I would now like to share a quick update on the projects we initiated the previous year. I am pleased to report that we have successfully completed the Alternative Fuel Resource (“AFR”) project at Risda Cement Plant in Chhattisgarh. Our clinker capacity enhancement projects in Risda and Nimbol, Rajasthan are progressing according to plan. Through debottlenecking efforts, we are increasing the clinker capacity by 1,000 TPD each at these facilities, and both projects are expected to be completed by the end of 2023. The Haryana Cement Plant (Bhiwani) expansion plan for establishing a grinding unit with a capacity of 1.2 MMTPA holds significant importance as it will help us establish ourselves in Northern markets. The project is in its final stages, and we anticipate reaping the benefits of this investment from the last quarter of FY 2023-24. The railway siding projects in Odisha Cement Plant (Jajpur) and Sonadih Cement Plant in Chhattisgarh are progressing well.

As we remain dedicated to our operational levers, we continue to work towards reducing our environmental impact through our sustainability initiatives. Aligned with India’s vision to achieve net zero by 2070, our Company has taken several initiatives to acknowledge the impact of the Building Materials Sector on the environment and its contributions to reducing global carbon emissions. We achieved carbon emissions of 462 kg CO₂ per tonne of cementitious materials, which is recognised as one of the best in the industry. Further, we aim to decrease carbon emissions by 2% annually and maintain one of the lowest carbon footprints in the industry.

From a social perspective, we remain committed to supporting our communities through various community development projects that are anchored on our values. Our aim is to empower and uplift the communities located near our operations improving the overall quality of life of the underprivileged with their inclusion into mainstream society.

The outlook for India’s cement business in FY 2023-24 remains promising, paving the way for growth opportunities for cement manufacturers in the country.

The Government’s initiatives to promote affordable housing and rural infrastructure development driven by improved consumer sentiment will provide a significant impetus to the industry. However, it’s essential to consider challenges such as volatile raw material prices, rising energy costs, and potential disruptions in the global supply chain that may impact the industry’s profitability.

As I gaze into a promising future, I express my sincere gratitude to all our stakeholders for their unwavering support. The dedication displayed by our team and the collective efforts of our business partners, investors and communities have transformed this challenging year into a rewarding and successful one for us.

Best Regards

Hiren Patel

Chairman