The Strategic Alliance between India Cements and Chennai Super Kings.

The Strategic Alliance between India Cements and Chennai Super Kings.A case study for Strategic Management Course

Amrita School of Business, KochiAswathy P, Arun Stephen, Arun Sen Kumar, Bhavya, Dona, Dheera, Divya, Deepthi, Dheeraj, Febin P N, Gauri.

INTRODUCTION AND BACKGROUND India Cements Limitedis a cement manufacturing company inIndia. It was established in 1946 and the first plant was set up at Sankarnagar inTamil Naduin 1949.India Cements, a household name in Tamil Nadu and Andhra Pradesh, decided to expand into the north Indian markets of Rajasthan, Gujarat and Madhya Pradesh. The Chennai-headquartered company bought a manufacturing unit in Rajasthan. The idea was good, but the results were disappointing. Local dealers shied away from India Cements.

ABOUT CEMENT INDUSTRY:Cement is one of the core industries which plays a vital role in the growth and development of a nation. The cement industry in India has been expanding significantly on back of increasing infrastructure activities and demand from housing sector. Keeping in line with the technological world, the Indian cement industry has transited itself into a more advanced one. At present, the Indian cement industry is positioned on the second rank globally and comprise of 183 large and 365 mini cement plants. Moreover, the Indian cement majors, including ACC Ltd, Shree Cement Ltd and Ultratech, have signed a co-operation pact to support low-carbon investments in India. The pact was signed in Geneva with member companies of the World Business Council (WBC) for Sustainable Developments Cement Sustainability Initiative and International Finance Corporation (IFC). The roadmap will pose as a possible transition path for the Indian cement industry to reduce its direct emissions by 18 per cent by 2050.

Market Size:A RNCOS report titled Indian Cement Industry Outlook 2015 estimated that the total installed capacity of cement in India will increase with a compound annual growth rate (CAGR) of around 7 per cent during 2012-13 to 2014-15. The growth of the Indian economy has slowed down in recent times on account of the rising inflation, high interest rates, high prices of commodities and fuels. The growth prospects of the cement industry are closely linked to the growth of the overall economy in general and the real estate and construction sectors in particular. The importance of the housing sector in cement demand can be gauged from the fact that it consumes nearly two-thirds of the countrys total cement. If the slowdown in real estate persists for an extended period, it would impact the growth in consumption of cement

ABOUT THE COMPANY:India Cements Limitedis a cement manufacturing company inIndia. It was established in 1946 and the first plant was set up at Sankarnagar inTamil Naduin 1949. The Company's plants are well spread with three in Tamilnadu and four in Andhra Pradesh which cater to all major markets in South India and Maharashtra. The capacities of its plants are over 9 million tons per annum. India Cements was founded byS. N. N. Sankaralinga Iyer. Sankar CementandCoramandel Cementare the brands used by ICL to market their produce. India Cement is the 3rd largest cement company in India.

The company is headed byN. Srinivasan, Vice chairman and managing director. The day-to-day affairs of the company are managed by Executive president Mr. T.S.Raghupathy and other key personnel in each functional area. On Feb 02 2013, MS Dhoni was appointed as the Vice President of the India Cements. Dhoni resigned from Air India and took over as the vice president of the India CementsShantanu bilse is the partner and pursuing his masters in USA. India Cements Ltd. also ownsIndian Premier League'sChennaifranchise,Chennai Super Kings. The entire idea here was brand promotion, and of course to give the company a corporate image of its own. India Cements has also tied up with leading apparel brands and team sponsors to help in huge brand promotion at minimal cost. Srinivasan is also involved inBCCIandAICF, the Indian administrative bodies for Cricket and Chess.

BUSINESS MODEL:Value Proposition: The company value proposition consists of manufacturing varieties of cements like Ordinary Portland cement, Portland Pozzona cement and Sulphate resistant cement. OPC is mainly used in RPC works, paving blocks, tiles, building blocks, runways, concrete roads etc. Whereas PPC is used in Hydraulic structures, marine structures etc. It produces good quality cements.Target customers: Customers is the pillar of any business. The company main revenue is from Housing, Infrastructure and commercial projects.Distribution Channel: The Company distributes its products through different channels. The main distribution channel is through dealers. Also through C and F agents, own government warehouses. The cement is transported to the dealers/distributors and also to sub dealers who finally sell it to the customers.Core capabilities: The Company is the market leader with a market share of 28% in the South. It aims to achieve a 35% market share in the near future. The Company has access to huge limestone resources and plans to expand capacity by de-bottlenecking and optimization of existing plants as well as by acquisitions.Value Configuration: The Company uses cutting edge technologies like cement manufacturing process, mining of limestone, drilling or blasting methods of mining, mining with surface miner, crushing of limestone, grinding of raw materials, homogenization, pyro processing. These process are carried out of its plant to speed up the production and manufacturing process.Partner Network: The Company in its partner network includes mainly dealers, retailers and renowned business associates. It has a strong distribution network over 10000 stocklists.Cost Structure: The major cost elements of the total cost is energy(28% of the total cost).Followed by transportation & handling which represents(20%), raw material (15%), staff cost (9%).

PRODUCTS AND SERVICES:PRODUCT NAMECATEGORYBRANDS

ORDINARY PORTLAND CEMENTOPC-53,OPC-43 AND OPC-33Graded cementCoramandel King, Sankar sakthi and Rassi gold

PORTLAND POZZOLON CEMENTIS 1489(PART 1) 1991,Portland pozzolona cement specification(fly ash based)IS 1489(PART 1) 1991,Portland pozzolona cement specification(clay ash based)Blended cementCoramandel super power, Sankar super power, Rassi super power

SULPHATE RESISTANT CEMENTSulphate resisting Portland cement(SRC)Sankar SRC

INDIAN CEMENTS AND ITS COMPETITORS IN THE YEAR 2013

UltraTech Cement:UltraTech Cement Limitedis Indias largest exporter ofcement clinker based inMumbai, India.The company is division ofGrasim Industries. It has an annual capacity of 52 million tonnes. UltraTech cement holds theSuper brandstatus. It is India's largest exporter of cement clinker. The company's production facilities are spread across eleven integrated plants, one white cement plant, one clinkerisation plant in UAE, fifteen grinding units, and five terminals four in India and one in Sri Lanka

Ambuja Cements:Ambuja Cements Limited, formerly known asGujarat Ambuja Cement Limited their principaactivity is to manufacture and market cement and clinker for both domestic and export markets. The company has entered into a strategic partnership withHolcim, the second largest cement manufacturer in the world from 2006. Holcim had, in January, bought a 14.8 per cent promoters` stake in the GACL forINR21.4 billion. The shares of the company are traded publicly on theBombay Stock Exchange(BSE) and theNational Stock Exchange(NSE).

Madras Cements ltdMadras Cements Ltdis the main company of the Ramco Group, a business group of South India. It is headquartered atChennai. The main product of the company is Portland cement, manufactured in five production facilities spread over South India, with a current total production capacity of 13.0 MTPA. The company is the fifth largest cement producer in India. It is the most popular cement brand in South India.

ACC CementsACC Limited(Formerlythe Associated Cement Companies Limited) one of the largest producers of cement inIndia.Its registered office is called Cement House. It is located on Maharishi Karve Road,Mumbai. The stock price of company contributes in calculatingBSE Sensex.The management control of company was taken over by Swiss cement majorHolcimin 2004. On 1 September 2006 the name of The Associated Cement Companies Limited was changed to ACC Limited. The company is only Cement Company to get Super brand status in India

GROWTH OF INDIA CEMENTS SINCE INCEPTIONIn 1946Incorporation of India Cements Limited. In 1949Commissioning of first Cement plant at Sankarnagar-Installed capacity 1 lac tonnes per annum. In 1990Acquisition of Coromandel Cement plant at Cuddapah-Installed Capacity rises to 2.6 million tonnes per annum.The India Cements Ltd. becomes the largest producer of Cement in South India. In 1991India Cements ventures into Shipping. Sets up a Shipping Division. In 1994ISO 9002 Certification for Sankarnagar plant. In 1995Announces issue of 1:1 Bonus shares. In 1997India cements acquires Aruna Sugars Finance Ltd.Renamed as India Cements Capital & Finance Ltd.In 1997India Cements acquires Cement Plant of Visaka Cement Industry Ltd., at Tandur, Ranga Reddy district of Andhra Pradesh. Installed capacity 0.9 Million Tonnes. In 1998India Cements acquires Cement Corporation of India's Yerraguntla Cement Plant at Andhra Pradesh. Installed capacity 0.4 Million Tonnes. In 1998India cements acquires Raasi Cement Ltd., at Nalgonda District of Andhra Pradesh. Installed capacity 1.8 million tonnes. In 1999India Cements acquires Cement Plant of Shri Vishnu Cement Ltd., at Nalgonda District of Andhra Pradesh. Installed capacity 1.0 Million Tonnes. In 2001India Cements divests its stake in Sri Vishnu Cement Limited. In 2001Group's overall capacity reaches 9 million tonnes. In 2005The Company has successfully completed an equity issue in the international market during October 2005 by issuing 25,613,796 Global Depositary Shares (GDSs) at USD 4.3226 per GDS, (each GDS representing 2 underlying equity shares of Rs 10 each) and raised an amount of Rs 497 crores including a premium of Rs 446 crores. In 2008The Company has revived its shipping business with the purchase of two ships (dry bulk carriers) with a total capacity of 79843 DWT. In 2008The Company has successfully bid for the Chennai franchise of the DLF-IPL 20/20 Cricket Tournament Chennai Super Kings. In 2010The Companys cricket franchise Chennai Super Kings won Champions League T20 tournament on 26th September 2010. In 2012Commemorative Postage Stamp on the Birth Centenary of Sri.T.S.Narayanaswami, one of the Founders of the Company was released on 11th November, 2012. In 2013The First shipment of 41,960 metric tonnes of Coal from the companys mines in Indonesia sailed from Muara Satui Port, Indonesia on May 14th, 2013 and arrived Tuticorin Port on May 25th, 2013. It will go to meet the needs of our cement / power plants.

CHALLENGES AND GROWTH OPPORTUNITIES OF THE COMPANY

The demand supply mismatch arising out of burst of new capacity additions (and not majorly out of lack of normal demand growth) has constricted the capacity utilization levels of the industry for the last two years in particular. Given the resilient nature of the economy, India has been able to achieve reasonable GDP growth of 6.9% in FY 12 which is expected to increase to 7.5% to 8% in FY 13 is expected to translate into a demand growth of 8% to 10% over the next few years. While demand for cement grew by 6.6% in FY 12, there are already encouraging signs of a pick-up in demand with demand spurting by over 10% in the last quarter of FY 12. It is therefore expected capacity utilization to gradually increase over the next 3 years with parity between supply and demand being restored by then. While this being the overall scenario, there are still pockets of high demand growth in certain regions of the country and the Company is already moving significant quantities of cement to the Eastern markets as far as Assam & Nepal to optimize capacity utilization, given the overall surplus. Company's attempts in the short run will be towards striking an optimum balance between volumes and profitability and achieve best results.The availability of power from the State Electricity Boards is another area of concern with acute shortages in power availability in Tamil Nadu and Andhra Pradesh. The Company has already addressed this concern by putting a 48 MW thermal power plant at Sankarnagar to take care of the full requirements of power of all the cement plants and grinding unit in Tamil Nadu and this power plant has been commissioned towards the end of FY 12 and has started supplying power. Availability of indigenous coal from the nationalized coal companies and the quality of supplies is another area of concern. This problem has however been mitigated to a large extent due to the coal linkages obtained during the last two years to cater to the requirements of the recent capacity expansions in Andhra Pradesh. The Company imports coal to meet its cement plants' requirements thereby adequately addressing the quantity, quality and cost aspects. Mining rights obtained in Indonesia should fructify with infrastructure of roads and bridges under completion to ensure timely coal supplies. The ever rising cost of energy in the form of petroleum products will also have its impact on the power and transportation costs, which it is hoped to be neutralized by increasing the selling prices.SUPPLY CHAIN IN INDIA CEMENTS

Bags are loaded from the factory on wagons or trucks.Company uses rail mode for primary transportation.CFA unloads the bags, stores and delivers it when orders are placed by the distributors.Trucks are used for secondary transportation.Distributors also store small quantity of cements to meet urgent demand.Apart from selling distributors help company in marketing and sales promotion activities.Retailers take orders and deliver it to the end customers.

LIMITATIONS OF SUPPLY CHAIN MANAGEMENT. Cements have a useful shelf life of approximately 6 months. Customers also have a bias towards fresh cements forcing the manufacturers to predict accurate amount of inventory. Demand for cement is cyclic in nature. A fine balance is to be achieved between inventory cost and capacity utilization. Since railway route is the cheapest mode of transportation, availability of railway wagon is a big constraint in present scenario.NEW SEGMENT OF INDIAN CEMENTSCoromandel Infotech India Limited Coromandel Infotech India Limited is a new generation software services and solutions company with niche industry focus, committed to providing innovative IT solutions to the growing business needs of its customers, that includes Fortune 500 companies, Blue-Chip Indian MNCs and Leading Banks in India and abroad. Alliance partners are ORACLE, Microsoft partner, finacle Infosys, hp etc.MERGERS AND ACQUSITIONS Acquisition of Coromandel cements plant at Cuddapah in 1990. Acquired Aruna Sugars Finance Ltd. And renamed as India Cements Capital & Finance Ltd. And also cement plant of Visaka Cement Industry in1997. Acquired Raasi cements and Cement Corporation of Indias Yerraguntla plant in 1998. In 1999, acquired Shri Vishnu Cements Ltd. As part of its strategy to become one of the major players with a pan India presence,India Cements Ltd, through its investment and financial services subsidiaryICL Financial Services Ltd(ICLFSL), has acquired the entire promoter holding of 53% inIndo Zinc Ltd.

MAJOR DIVERSIFICATION IN INDIA CEMENTSI. Aluminum productionII. Chemicals III. Plastics IV. ShippingV. Education Institutions VI. Sugar Manufacturing VII. Electrical companyVIII. Subsidiaries (Industrial Chemicals & Monomers Limited, ICL Financial Services Limited, ICL Securities Limited, ICL International Limited, Trishul Concrete Products Limited, Trinetra Cement Limited,PT. Coromandel Minerals Resources, Indonesia and Coromandel Minerals Pte. Limited, Singapore.)

EDUCATIONAL ACTIVITIES OF THE INDIA CEMENTS LTDIn order to further the cause of education, a cause very much dear to the founders of ICL, Shri Sankaralinga Iyer and Shri T.S. Narayanaswami, the Management of ICL, constituted an Educational Trust on 18th June 1958, with the object of establishing and running educational institutions like Polytechnics, Colleges, Technical High Schools and Higher & Lower Secondary Schools. These institutions were primarily conceived of for the benefit of the children and dependents of the employees of ICL. It was also intended that the institutions should serve the community in the areas where the factories are situated. The Company runs the following educational institutions at Sankarnagar, Sankaridurg, Chilamkur, Yerraguntla and Dalavoi where the cement factories are located.SUGAR MANUFACTURING Coromandel Sugars Ltd., has achieved record crushing of 7.84 Lakh Ts (5.28 Lakh Ts) during the year under review.The sugar recovery stood at 10.17% as was in previous year. It may be noted that higher cane availability during the season continued till April 2011 resulting in total crushing of 8.50 lakh tonnes for the season 2010-11. Improved cane price paid to growers in the earlier season has motivated the growers to up the area under sugarcane plantation by over 60%. With expanded plant capacity of 3500 tonnes crushing per day (tcd) in place, higher sugar cane availability with reasonable sugar recovery, the company was able to maintain the excellent performance achieved during the earlier years.

COROMANDAL ELECTRIC COMPANY Due to additional availability of natural gas during the year, the Company was able to generate 205 Million units of power as compared to 170 million units in the previous year, which was wheeled and used at the cement plants of your Company in TamilNadu. The total revenue earned by the Company during the year was Rs.64.42 Crores (Provisional) as against Rs.44.78 Crores in the previous year and net profit after tax was Rs.10.81 Crores (Provisional) against the previous year figure of Rs.8.42 Crores. The Company maintained its dividend pattern of 9% on equity shares besides declaring dividend at the respective coupon rates for the participating / non-participating preference share capital. During the year the Company has redeemed the first annual installment of redeemable cumulative participating / non-participating preference shares on the due dates.

ENERGY EFFICIENCY AND COST REDUCTION Despite the lower capacity utilization caused by lower demand in the market, sustained efforts made by your company resulted in marginal reduction in power consumption per Tn of cement and maintaining the fuel consumption/ Tn of clinker on par with the previous year. The ever increasing cost of fuel and increase in power tariff by State Electricity Boards imposed additional burden which could however be controlled through fuller utilization of the power from the Company's gas based power plant at Ramanathapuram and also from the low cost power availed from Andhra Pradesh Gas Power Corporation Limited (APGPCL) in Andhra Pradesh. The Company also utilized the wind power generated by its wind farms of a total of 279 Lakh Units (315 Lakh units) and power from its Waste Heat Recovery System at Vishnupuram which accounted for 539 Lakh units (475 Lakh units). Towards the end of the last quarter the Company's captive power plant of 48 MW at Sankarnagar has been commissioned.

DEVELOPMENT ACTIVITIES During the year, the Company obtained ISO 9001 certification for quality assurance for its Sankari Plant in addition to its already certified plants at Sankarnagar, Dalavoi, Chilamakur and Vishnupuram. The ISO certification for its Yerraguntla Cement Plant is in progress. The Company has also implemented Total Productive Management (TPM) for productivity improvement in its plants at Sankarnagar, Dalavoi, Chilamakur, Yerraguntla, Vishnupuram and Malkapur. CLEAN DEVELOPMENT MECHANISM (CDM) Waste Heat Recovery System at Vishnupuram continued to earn certified emission reductions as a CDM project. OUTLOOK Economic experts are banking on the domestic market to sustain growth through a Government led initiative to boost private sector infrastructure investments. With industrial growth exhibiting signs of a revival and given the Government's intention to boost agriculture development and give a fillip to infrastructural growth, the clocking of a GDP growth of 7.5% in 2012-13 could well be achievable. Both the Central and State Governments have plans to boost investments in housing for the lower income groups which could help drive cement demand together with proposed investments on roads and other infrastructural projects. The recent proposals of the Reserve Bank of India in its Credit Policy to reduce Repo and Reverse Repo rates by 50 basis points is expected to soften housing loan interest rates thereby giving a fillip to demand for housing for the middle income sector. Given all these positive factors, it is reasonably expected a 8% to 10% annual growth in cement demand over the next few years and an early restoration of parity between cement demand and supply which should augur well for the cement industry.

VALUE ENHANCING STRATEGIES Through various upgrades / timely expansion at its locations, the Company has reached a capacity of 14.05 million tonnes from 8.81 million tonnes in 2002. The second strategy of securing uninterrupted supply of power and fuel is also being achieved through installation of power plants and also through acquisition of coal mining rights in Indonesia. The Company also secured additional linkages of domestic coal for two of its Andhra Pradesh plants and in order to circumvent the volatility in the ocean freight, the Company has also acquired two ships for transporting coal / other raw materials based on cost economics. The Company's strategy of optimizing the manpower strength has also been achieved through various voluntary retirement schemes over the years and is presently improving upon the skills of its workers for doing multi tasking. As North and West markets have been growing, the Company is on the lookout for further growth opportunities available in that region. The Company has put in place a Management Team for infrastructure projects. Based on the demand supply scenario in the next few years the Company also proposes to increase its presence in its dominant South market through further capacity creation at one of its existing location. HUMAN RESOURCES & INDUSTRIAL RELATIONS The industrial relations remained cordial throughout the year at all the units. Training and multi task development skills are given prime importance. The overall number of employees at the end of the year under review was 3195 (3220).

ALLIANCESChennai Super KingsChennai Super Kings, the cricket team of the Chennai cricket franchise owned by the company continues to add shareholder value with its outstandingly consistent performance. Besides winning the Champions League in 2010 whereby completing a Cup and League double, team has been crowned champions for the second year in succession in the just concluded IPL 2011. It has also won the Fair Play Award for 2011 third time in four years exemplifying the teams underlying philosophy. The fact that the latest entrants to IPL 2011 have had to pay nearly Rs.1700 Crores for Franchise rights is an indication of what brand valuation most successful franchise presently commands.

India cements and CSK -franchise historyIndia Cements, a household name in Tamil Nadu and Andhra Pradesh, decided to expand into the north Indian markets of Rajasthan, Gujarat and Madhya Pradesh. The Chennai-headquartered company bought a manufacturing unit in Rajasthan. The Chennai franchise was sold to theIndia Cementsfor $91 million, making it the fourth most expensive team in the league behind Mumbai, Bangalore and Hyderabad. India Cements acquired the rights to the franchise for 10 years.N. Srinivasan, vice-chairman and managing director of India Cements Ltd., is the de facto owner of the Chennai Super Kings, by means of his position within the company. He was also the President of the BCCI. The captain of the Chennai Super Kings is the current Indian skipper,Mahendra Singh Dhoni.Dhoni is also the vice-president of India Cements. Krishnamachari Srikkanth, former captain of theIndian cricket teamand the former Chairman of the National Selection Committee, was the brand ambassador for the franchise until the end of 2010 when his three-year contract expired. Former Indian openerV. B. Chandrasekharis the Chief Selector of the team.CAMPAINS India Cements Limited launched its first Twenty20 cricket tournament for city schools to unearth talent and harness the youngsters' skills.

Impact -betting controversy hitting the 'Brand CSK'CSKofficials had gone on record to talk about revenues ranging from Rs 140-150 crore just before IPL 6 kicked off. But now its branding may take a severe beating.CSK is estimated to have earned Rs 35 crore and Rs 45 crore in the first two IPL editions. "The team reportedly broke even in the first edition but lost money in IPL 2 because of the shift to South Africa," an analyst with a Mumbai-based broking firm said. "CSK made profits in the third season and has been increasingly profitable ever since," he added. By IPL 4, the most successful team in the league clocked revenues of around Rs 138-140 crore which went up to around Rs 150 crore by IPL 5.India Cementsofficials have talked of 15-20% growth year by year for the past two years. Given that revenue wise it's not even 10% of the mother company, The IPL team is more of a marketing exercise. In fact, we don't attribute much value to CSK while calculating the India Cements assets." The hit in terms of earnings per share, would not exceed Rs 10-15.With a dealer network and an established customer base in place, the controversy about IPL may not significantly impact its cement sales. Even if sales do get impacted, overall revenues may not take a big hit as southern markets still make up over 75 per cent of India Cements revenues. As far as the southern market is concerned, the company is a well established player and the CSK link doesnt make a difference.While financially it may not matter too much, CSK is critical to ICL in marketing and branding terms. "India Cements as a brand has two aspects -- one with the consumers or the end users and the branding for them won't be impacted because they would only deal with the product of the company. The brand image for investors and other stakeholders will take a hit because the company's image with respect to corporate governance norms will be shaken," said brand expert Harish Bijoor.

But more than anything else, the controversy is sure to hit CSK's sponsors. It could also affect sponsors as every sponsor today is worried about the IPL as investments here are deep. A brand would want to sponsor a player or a brand which has consumer goodwill and not such ill will.Chart showing the fall of India cements markets after the scandal

India Cements LimitedBSE: 46.20 (0.00%)NSE: 46.05 (0.00%)

QUESTIONS:1. Is CSK critical to India Cements finances?2. How Chennai super kings brand helped Indian cements to extend its brand in North India?3. How much will the betting controversy surroundingChennai Super Kings cost its owner - India Cements?4. How to get back the local shield?

Analysis:Financial AspectsPoor results in the March 2013 quarter and the controversy surrounding the arrest of Gurunath Meiyappan have seen the stock of India Cements correct sharply over the last week. The stock has fallen 17 per cent to Rs 68.70.To the companys full year revenue for 2011-12 (Rs 4,203 crore), income from the Indian Premier League franchise contributed just 3.2 per cent (Rs 137.3 crore). At the EBIT (earnings before interest and tax) level, the contribution was 4.4 per cent at Rs 41 crore.CSK isn't a big financial component of India Cements. V Srinivasan, research analyst with Mumbai-based broking firmAngel Broking, said: "If CSK goes off the league, it'll have some impact on the future earnings per share of India Cements. ICL picked up the CSK franchise for $91million but the yearly pay is only $9million and so far they must have paid around $54million. CSK makes around Rs 25-30crore every year which is not big money for a company of ICL's size.

How India Cements leveraged its alliance with CSK India Cements is riding on the popularity of Indian Premier League champions Chennai Super Kings to enter new markets at a furious pace, in perhaps the best example for utilizing a brand's association with cricket's most valuable property.

"India Cements is exploring ways to harness the huge potential offered by Chennai Super Kings," said Rakesh Singh, joint president, marketing, at South India's largest cement maker that owns the IPL team captained by M S Dhoni.

It plans to sell close to one million tones of cement a year in North Indian markets such as Gujarat, Madhya Pradesh and Rajasthan, building on the equity around the cricket team, he said.India Cements recently roped in more than 500 dealers in Gujarat by offering free tickets for Chennai Super King matches and a visit to the Tirupati Balaji temple for 'darshan'.Till three years ago, India Cements was an unknown name in most of North Indian markets dominated by companies such as Holcim and Grasim.

Mr Singh remembers having trouble explaining about his company to friends and relatives in his hometown Varanasi in those days. Now, everybody knows India Cements as the owners of Chennai Super Kings (CSK). "CSK is one brand that has catapulted ICL into a different league," he said. The company is already dispatching 10,000 tonnes of cement per month to the Gujarat market.

It plans to sell more than 60% of production from its first North Indian plant coming up in Rajasthan in Gujarat, Madhya Pradesh and Rajasthan. The 1.5 million tonne capacity plant goes on stream in June.

Besides giving away free tickets and Tirupur 'darshan', India Cements also made Indian cricket captain Mahendra Singh Dhoni meet its dealers Nagpur and Ahmedabad along with company director Rupa Gurunath.

The company is now working on the strengths of Chennai Super Kings to help attract buyers to its cement brands.

"We are doing all promotions around CSK and the brand power is being tested for the first time in the north," Mr Singh said.

Ahmedabad, Baroda and Surat have yielded good results, he said. Andhra Pradesh and Karnataka markets too are reaping the benefits. India Cements entered Madhya Pradesh in the last fortnight.Merchandising also offers a huge potential including in overseas markets like the US and Singapore, where CSK has a good support base.

VRIO FRAMEWORKVALUABLE: 1. Plants are strategically located1. Proximity of markets to principal markets and ports.1. 6 to 9 plants located in proximity to deficit markets of Tamil Nadu and Kerala1. Plant locations provide easy access to markets1. Ports provide access to international markets and fuel.1. Access to raw material2. Adequate limestone reserves at all plant locations2. Fly ash sourced from thermal plants nearby.2. Proximity to ports provides easy access to imported coal.RARE: Continuous focus on efficiencies and captive power and coal to lead to improve EBITDA. COSTLY TO IMITATE: Coromandel Super Power, Sankar Super Power and Raasi Super Power are the premium blended cements from THE INDIA CEMENTS LIMITED. It is produced by inter-grinding of OPC clinker along with gypsum and mineral admixtures. Dedicated to the end user after passing through stringent tests at our R&D laboratory, it ensures a durable structure that lasts for generations.Salient features: Strength increases as time passes. High durability concrete - protects from corrosion, coastal attack and extreme temperature. Ideal cement for resisting aggressive environments like chemical, chloride and sulphate attack. Best suited for high performance concrete. High fineness - suited for plastering and finishing works. Low heat of hydration - Ideal for mass concrete pours and machine foundations Equivalent to 53 grade cement.ORGANISED TO CAPTURE VALUE: Coromandel King, Sankar Sakthi and Raasi Gold are high strength cements, to meet the needs of the consumer for high strength concrete. As per BIS requirements the minimum 28 days compressive strength of 53 Grade OPC should not be less than 53 Mpa. For certain specialized works such as pressurized concrete and certain items of precast concrete requiring consistently high strength concrete, the use of 53 Grade OPC is found very useful. 53 Grade OPC produces higher-Grade concrete at very economical cement content. In concrete mix design, for concrete M-20 and above Grades a saving of 8 to 10% of cement may be achieved with the use of above mentioned 53 Grade OPC.PORTERS FIVE FORCE ANALYSIS

References

http://www.indiacements.co.in/http://www.thehindubusinessline.com/markets/stock-markets/csk-is-not-critical-to-india-cements/article4766560.ecehttp://www.ndtv.com/article/india/india-cements-full-statement-on-gurunath-meiyappan-s-role-in-chennai-super-kings-370950http://articles.economictimes.indiatimes.com/2010-05-07/news/27576742_1_india-cements-cement-brands-largest-cement-makerhttp://en.wikipedia.org/wiki/India_Cementshttp://www.business-standard.com/article/companies/india-cements-q1-net-down-72-113081200409_1.html