Diversifying to grow

Although the company started out as a producer of bulk commodity like cement, NCL Industries has always been on a look-out for diversification to augment its revenues and grow inorganically.Promoted in 1983 by K Ramachandra Raju, Nagarjuna Cements (as NCL Industries was known then) was a trendsetter for the establishment of the mini cement industry in the country. This initial experiment of mini cement plants to augment the supply of scarce cement with relatively low investment was resounding success. The company ended up declaring a dividend of 25 per cent in the very first year of its operations.Though the company started as a producer of a bulk commodity like cement, NCL has been constantly on the lookout for diversification. The products conceived and introduced by the company were ahead of times. Cement bonded particle boards and prefab shelters are examples. The merger of NCL Energy into the company brought added hydro power to the range of products of the Company.NCL now has five operating divisions, namely cement, ready mix concrete boards, prefab shelters and energy.
Cement DivisionHaving started as a mini cement plant with a modest capacity of 200 tonnes per day (66,000 TPA) the Cement Division has gone through several rounds of expansion. A conscious programme of phased expansion saw a continuous enhancement of capacity. NCL has a clinker and grinding unit near the limestone mines at Simhapuri, Nalgonda district of Andhra Pradesh. An additional grinding unit with a capacity of nearly a million tons per annum was set up at Kondapalli near Vijayawada city. Today, NCL has grown into a major cement plant with a capacity of 2 million tonnes per annum.Ready Mix Concrete DivisionThe company forayed into Ready Mix Concrete business in December 2011 and the product is being well accepted by the market.Boards DivisionIn technical collaboration with Bison Werke of Germany, (presently Kvaerner Group), the company set up plant for manufacturing cement bonded wood particle boards. These boards are used in several applications including as partition panels, door and window panels, false ceiling and even roofing material. In-house R&D activities resulted in innovations like laminated boards and designer boards. The products of this Division, marketed under the Brand Bison Panel and Bison Lam have gained popularity and market acceptance. To meet the increasing demand and cater to the North Indian market, the company set up new plant with 50,000 TPA capacity in Paonta Saheb, Himachal Pradesh.Prefab DivisionPrefab Shelters using Bison Panels has been another innovation introduced by NCL. Wherever speed of erection is of essence, prefab structures are the preferred solution. Initially the armed forces, police and paramilitary organizations constituted the principal customers for construction of camps and billets. In course of time, prefab structures have become very popular for industrial project housing and even for class rooms, hostels etc. Successful erection of structures for three IIIT campuses in Andhra Pradesh in record time has been a recent feather in the cap for NCL. Structures covering a total area of 7.67 lakh sq ft were erected within a record time of four months for three campuses of IIIT in Andhra Pradesh.Energy DivisionWith the merger of NCL Energy with the company, hydro power generation was added to the activities of NCL. It has an aggregate capacity of 15.75 MW spread over two locations in Pothireddipadu in Andhra Pradesh and Tungabhadra Dam in Karnataka.Financial PerformanceThe company has been making rapid strides over the past five years. The growth record in terms of turnover and profits is as follows: