Economy & Market
The Tale of Two Cement Giants
Published
9 years agoon
By
admin
ACC and UltraTech have both surprised the market a massive topline in July-September 2017 quarter. ICR compares their financial results.
Although it has been a pessimistic quarter for the Indian cement industry as data show cement production fall year-on-year, that began in December 2016. However, August and September showed some resilience with negligible recovery in the production growth rate. The pessimism is also corroborated by Cement Manufacturers Association (CMA) stating that the industry was sitting on more than 100 MT a year of excess or idle capacity. Even, the credit ratings agency ICRA following the output data has downgraded its forecast for cement demand growth to not more than 4 per cent for the 2017-18 FY.
The Indian Cement Review (ICR), in its April issue, had predicted demand to expand just 3.6 per cent in FY18 assuming real GDP grow 8.5 per cent leading to 4 per cent increase in construction activity during the year. Considering that economy will grow at 8.50-9.00 per cent in the next five years, the statistical relation between cement demand and economic growth, the ICR had predicted cement demand to grow at an annual growth rate of 4 per cent over the next five years. However, the GDP growth seem to taper in Q1 2017-18 and would remain slower throughout the year.
The bar graph shows production peak in 2015-16 before falling as monthly production broke the trend in the 2016-17 while the line graph pinpoints the month it started to go wrong, November 2016, when the government demonetized high currency notes. Production growth turned negative the in December 2017 and could not managed to correct itself since then. Nevertheless, it is convenient to blame the policy for the production slump but the trough in February 2017 before taking a lower level of decline since then.
The Reserve Bank of India (RBI) annual report in August 2017 suggested that the policy failed in its primary purpose of reducing the kind of corruption that a cash heavy economy can hide such as tax avoidance. People reportedly managed to find ways to bypass the bank deposit limit and may have successfully laundered large amounts of cash without being caught. However, Financial Times have pointed out, the longer term implications of forcing the economy towards digital payments and increasing the tax base could yet be beneficial overall.
Coming back, the CMA’s blame of overcapacity for the current mess, it appears to have underplayed the capacity crisis facing India. UltraTech Cement’s number based on data from the Department of Industrial Policy and Promotion, show an overcapacity of 155 MT in 2016-17 and this is poised to blot to 157 tonne in 2017-18, even utilisation rate is expected to rise slightly. UltraTech’s estimates utilisation rate topping 70 per cent until the 2020-21 while Mint newspaper concur, although reckoning the rate would bounce sooner, in 2019-20. As CMA brought forth the industry’s excess capacity, it pinned outlook on infrastructure schemes like the Mumbai-Ahmedabad bullet train announced recently, This prompted JK Cements to point that one train project will not make much of a difference for demand to bounce back.
Infrastructure was one of the important factors for ICRA and the other credit agencies to forecast growth in cement demand and development then had indicated that industry may be able to narrow the gap between production capacity and demand. Unfortunately, demonetisation undid ICRA’s growth prediction for 2016-17.
It had predicted demand growth at 6 per cent but it turned out to be just 1.2 per cent. So downgrading forecast for 2017-18, on fears of weather and adverse impact of Goods and Services Tax (GST) beginning Q2, is valid. Major cement producers such as Ultratech and Ambuja Cement had based their road to recovery in their latest investor presentations on the 6 per cent growth or even higher. Being lower than expected and overcapacity gap not narrowing down, the hope now is pinned at a brisk business in second half of 2017-18.
Prospect still bright despite lean Q2 2017-18
During Q2 2017-18, characterise as lean season for cement consumption due to south-west monsoon, demand and pricing trends of cement was a mixed bag. But, a closer inspection suggests the recent past as well as future prospect are in good shape.
While prices in east and west India have surprised with year-on-year rise, it was not so in other regions. Hence, average all-India cement prices are pegged flat to up 3 per cent cent in Q2. But, if one were to factor in the 2-3 per cent reduction in the tax rates after implementation of GST, which is also reflected in the prices, the overall pricing trend is encouraging.
On demand, although monsoon was a factor impacting construction, sand availability, active government projects, etc., had a bearing on regional patterns. While north and east as well as Andhra Pradesh/ Telangana witnessed volume grow of 10 per cent y in Q2, largely driven by high execution of government projects, demand apparently declined in central and south, dragged by sand shortage in Uttar Pradesh and Tamil Nadu. Tamil Nadu and Kerala markets did not see much activity in government projects. Expectedly, central and south India saw major price impact. Before the announcement of Q2 results, HDFC Securities expected cement companies to post 13.4 per cent volume growth while Kotak Institutional Equities expected a lower volume growth of 6 per cent in cement volumes. With healthy volume growth and realisation, pan-India players like UltraTech and ACC, and those with larger exposure to east and west like Ambuja Cements and Shree Cement were expected to report better Q2 performance. Nevertheless, rising cost of fuels such as pet-coke and coal, would restrict any sharp increase in per tonne profitability in year on year comparison.
Beyond Q2, the prospect is positive, expert believe, for the cement companies anticipating a turnaround in demand in the second half of 2017-18, led by rural recovery even as the first six months may have seen the impact of the Real Estate (Regulation and Development) Act (RERA). JM Financial expect demand from the affordable housing and infrastructure segments to drive volume growth in the second half of the current fiscal year, while Centrum Broking indicated that cement demand should recover post monsoon and as the GST and RERA drag fades in the coming months and sand availability improves.
Experts also opine that with overall capacity expansion pace is slowing and with demand outpacing, cement manufacturers should benefit. Reliance Securities foresees incremental demand to outpace incremental supply, and, thus, better utilisation rate in the ensuing years. Factoring an average annual expansion in capacity of 8-10 MT, incremental demand is pegged at 15-20 MT over 2018-2020.
Performance analysis of top cement companies in Q2 2017-18
ACC and UltraTech Cement have both surprised the market a massive topline in July-September 2017 quarter. Prices have firmed supported by some rise in demand which was seen picking up in the north slightly in the west also, south has been lagging behind, signs in west and north are good price wise and volume wise. Infrastructure sector was picking up substantially implying healthy growth in the foreseeable future. Low-cost housing is slow to pick up and with the monsoons being good, rural demand is expected to pick up in January-February onwards.
UltraTech
UltraTech, the largest cement company with capacity of 89 million tonne per annum (85 mtpa in India), has presence in all the regions in India. In 2017-18, UlltraTech expanded its capacity by 25 per cent by acquiring 21.2 MT from Jaiprakash Associates. It also has 80 per cent stake in Dubai-based Star Cement.
Compared to market expectations, UltraTech has beaten consensus with great Set of numbers given the consolidation. Numbers are way ahead of consensus and beats street estimate by 21 per cent. Despite consolidation it has delivered Rs 1,000 EBITDA a tonne, which is termed com?mendable against the expectation of Rs 871 a tonne. Q over Q realisation improved 1 per cent.
UltraTech reported a 28 per cent decline in net profit (in standalone) to Rs 431 crore for the quarter ended September 2017. It had clocked net profit of Rs 601 crore in the July-September 2016. The company’s net sales were up 7.1 per cent at Rs 6,571 crore during Q2 2017-18 as against Rs 6,135 crore in same quartet the year-ago.
This quarter continued to witness increasing cost trends, attributable to increase in fuel price while total expenses were up 11 per cent at Rs 6,095 crore as against Rs 5,491 crore. Depreciation increased 59 per cent to Rs 499 crore while interest cost doubled to Rs 376 crore due to cost involving new cement plant acquisition. Meanwhile, EBITDA increased 24 per cent to Rs 1,350 crore, translating into EBITDA/tonne of Rs 1,028 and margin of 21 per cent.
The company stated that the acquisition of cement plants of Jaiprakash Associates and Jaypee Cement Corp had helped it augment capacity to 93 million ton per annum. The acquisition has also enhanced its footprint in the high growth markets of central India, eastern UP and coastal Andhra Pradesh, where the company has been focusing to increase its presence. Volumes for Q2 increased 18 per cent to 12.84 MT due to the ramp-up of JPA assets. Pricing improvement was better than expectation at Rs 5,001 a tonne due to firm prices across most focused markets.
Ambuja and ACC
According to Neeraj Akhoury, Managing Director and CEO, ACC, "results demonstrate its capacity to respond quickly and resolutely to changing market dynamics and execute strategies with focus and determination." ACC’s operating results has beaten consensus by 10 per cent against market expectation of 19 per cent. Volume grew 17.6 per cent YoY was higher against. consensus of 6 per cent. The cement giant has maintained control on its operating expenditure as anticipated. EBITDA was at Rs 592 a tonne, 12 per cent higher than expectations at Rs 527 a tonne.
Ambuja delivered a strong set of numbers while focusing on brand building, through differentiated offerings for individual home builders, building and infrastructure segments. According to Ajay Kapur, Managing Director and CEO, the company’s strategy to focus on key markets, premium products and value based pricing has paid off, leading to strong net sales and EBITDA growth.
During July-September 2017 quarter Ambuja Cement recorded higher sales and growth in value-added pricing, but it also faced cost pressures relating to rising fuel costs, packaging and raw material prices. Thus, there has been a move to increase its use of petcoke and alternative fuels further, as against 67 per cent it achieved in June 2017. Ambuja Cement’s net sales rose 16 to Rs 2,320 crore even as sales volume grew slower at 11.6 per cent to 5.02 MT. EBITDA per tonne rose 3 per cent to Rs 706.
Merger ambitions
Ambuja Cement has a 50.05 per cent share in ACC and the board of directors have initiated a study into the possibility of merger between the two companies. A national daily recently pointed that in a post-merger situation, the new entity would save about 10 per cent in operating expenses, especially with better logistics in terms of reaching relevant markets, manpower and taxes. The new entity will have a production capacity of 63 MT, making it the No. 2 player after UltraTech.
Ban on petcoke will increase cement cost
An Indian Supreme Court ruling to ban the use of petcoke in and around National Capital Region is likely to have adversely impact on cement plants and prices in northern India, as produces are expected to switch to higher-cost fuels. The ban impacts cement producers in Uttar Pradesh, Haryana, and Rajasthan, while all have districts falling under the NCR. These producers will be required to use either domestic or imported coal from November 1, 2017, resulting in an increase in power and fuels costs.
Petcoke is a key fuel for the Indian cement industry. Its usage ranges from 100 per cent of total fuel consumption at Shree Cement to 62 per cent at Ambuja Cements. Power and fuel costs vary from highs of Rs 852 a ton at Ambuja and Rs 856 a tonne at J.K. Cement to Rs 425 per tonne at Shree Cement. The petcoke ban could add an additional Rs 8-10 per tonne to fuel and power costs.
Cement to benefit in the coming years
The government has identified the construction and infrastructure as one of the key sectors that will help improve overall economic growth. Infrastructure projects in power, irrigation, roads, metros and railways, as well as dedicated freight and industrial corridors, are likely to generate strong demand for cement in the country. Furthermore, increased spending on affordable and low-cost housing coupled with the normal monsoon is expected to boost the rural economy which augurs well for the cement industry.
– Nitin Madkaikar
Concrete
Green Construction Through Cement Innovation
Published
7 hours agoon
July 2, 2026By
admin
Indian Cement Review (ICR) and Fuller Technologies brought industry, policy and technology leaders together to discuss how cement innovation can drive green construction at scale, writes Rakesh Rao.
India is building at a pace few countries can match. Highways, airports, housing, logistics parks, industrial corridors and urban infrastructure are reshaping the country’s economic geography. But beneath this growth story lies a difficult question: can India continue to build at scale without locking itself into a high-carbon future?
That question formed the core of an online panel discussion titled “Driving Green Construction Through Cement Innovation”, organised by Indian Cement Review (ICR) in association with Fuller Technologies as the Presenting Partner on June 25, 2026. The webinar brought together experts from cement technology, R&D, global industry platforms, building performance policy and international development cooperation to examine how low-carbon cement and material innovation can accelerate India’s green construction transition.
The discussion came at a crucial time. India has committed to achieving net-zero emissions by 2070 and reducing the carbon intensity of its economy by 45 per cent by 2030. At the same time, the country’s construction sector is expanding rapidly, driven by urbanisation, infrastructure development, housing demand and industrial growth. Cement, as one of the most widely used construction materials, sits at the heart of this transition. It is indispensable to development, but also central to the challenge of reducing embodied carbon in buildings and infrastructure.
Moderated by Nitika Krishan, Senior Urban Infrastructure and Sustainable Policy Consultant, the panel featured:
- Kiranmai Sanagavarapu, Director, Low Carbon Solutions, Fuller Technologies;
- Dr Hemantkumar Aiyer, VP and Head R&D, Nuvoco Vistas Corp Ltd;
- Devika Wattal, Innovation Lead, Global Cement and Concrete Association (GCCA);
- Dr Sunita Purushottam, MD, GBPN India (Global Buildings Performance Network); and
- Vaibhav Rathi, Senior Technical Advisor, GIZ (the German Agency for International Cooperation)
Setting the tone for the discussion, Nitika Krishan underlined the scale of the challenge before the sector. “The question before us is no longer whether we build, but how we build sustainably,” she said. She pointed out that construction accounts for nearly 40 per cent of global energy-related carbon emissions when both operational and embodied carbon are considered. Cement production, she added, remains one of the hardest industrial processes to decarbonise.
For India, this is not merely an environmental issue. It is a development issue, a competitiveness issue and increasingly, a market issue. As one of the world’s largest cement producers and among the fastest-growing construction markets, India’s material choices will influence the carbon trajectory of its built environment for decades. As Krishan observed, sustainability solutions in economies such as India must not remain limited to laboratory success. They must be scalable, commercially viable and practical at national level.
The innovation gap: From technology to market
Experts believe that there is a need to bridge the innovation gaps for making decarbonisation in cement and concrete scalable. Devika Wattal of GCCA, explained, “The starting point must be the core cement manufacturing process itself. The first and foremost is the heart of our process, the heart of cement manufacturing. How do we reduce clinker? That is always a topic where industry is working very intrinsically.”
Clinker reduction remains one of the most important pathways for lowering emissions in cement. Since clinker production is energy-intensive and chemically emits carbon dioxide, reducing the clinker factor through supplementary cementitious materials (SCMs), blended cements and new chemistries can have a significant impact. Wattal also noted that carbon capture, utilisation and storage (CCUS) will have a role, though it may not be the first lever for all markets.
However, she stressed that innovation cannot stop at technology development. A solution that works in the lab must also be adaptable to industry, scalable in production and acceptable in construction practice. “It is important for that innovation to be adaptable, to be scalable, and so that it can be executed in real time,” she said.
Wattal also called for stronger enabling systems around innovation. These include performance-based standards, product-level embodied carbon databases and clearer frameworks for evaluating green materials. Without these, low-carbon cement products may struggle to compete with conventional materials in procurement and design.
R&D must balance carbon, cost and performance
Bringing in the R&D perspective into the discussion, Dr Hemantkumar Aiyer of Nuvoco Vistas emphasised that low-carbon cement development cannot be treated as a single-variable exercise. Cement must perform in real construction conditions. It must deliver strength, durability, consistency and cost competitiveness, while also reducing carbon.
“The root of understanding and balancing all these aspects lies in materials, and knowing the materials,” he said.
According to Dr Aiyer, R&D teams must understand the variability of raw materials such as fly ash, slag and clinker. Different sources produce different material behaviours. This makes mix optimisation, material characterisation and processing-property relationships critical. When performance is affected, cement manufacturers must understand how strength enhancers, admixtures and other performance chemicals interact with the material system.
He also linked material science with process efficiency. Clinkerisation takes place at extremely high temperatures, around 1,400 to 1,450 degrees Celsius. Any improvement in raw mix design, process control or energy optimisation can, therefore, help reduce emissions and cost. Dr Aiyer pointed to artificial intelligence-based optimisation, Cement 4.0 tools and advanced software as important enablers for real-time process and material control.
“The more you understand the materials, the more you can control it,” he said.
LC3: The promise is proven, the sequencing is not
Limestone calcined clay cement, commonly referred to as LC3, has attracted global attention because it can reduce clinker content significantly by using calcined clay and limestone while maintaining performance in many applications. Kiranmai Sanagavarapu of Fuller Technologies said the technology itself has already moved beyond proof of concept. Fuller Technologies has worked with calcined clay technology for nearly two decades and has seen plants running in France and Ghana. These plants, she said, are meeting local and national specifications, while the economics are beginning to make sense.
“The calciner is performing, the economics is stacking up, it is making business sense to produce,” she said.
But if the technology is viable, why has adoption not scaled faster? For Sanagavarapu, the answer lies in project sequencing. Too often, clay characterisation happens after equipment is specified. This, she warned, is a backward approach because calciner design depends on clay mineralogy, kaolinite content, iron levels, reactivity, moisture and other variables.
“If you don’t know what your deposit looks like before you commit for the equipment, you are, in a way, going blind into designing,” she said.
She also identified permitting and plant integration as major bottlenecks. Environmental clearances, mining permissions and local regulatory approvals must begin early. Similarly, calcined clay must be integrated into existing grinding, blending and logistics systems from the design stage, not treated as an afterthought during commissioning.
India already has IS 18189:2023 standard for LC3, but Sanagavarapu pointed out that the standard is not yet visible enough in procurement documents. “The gap between what is technically being permitted and what the procurement is asking is the single biggest bottleneck,” she said.
In her view, successful scale-up depends on getting the sequence right: clay characterisation first, permitting in parallel, standards aligned with construction, and integration built into plant design.
India’s LC3 journey: Progress, but demand remains thin
Providing details of India’s LC3 commercialisation experience, Vaibhav Rathi of GIZ noted that JK Cement carried out the first commercial production of LC3 at its Rajasthan plant, followed by JK Lakshmi Cement three months later. These initiatives were supported by the International Climate Initiative of the Government of Germany, with IIT Delhi contributing deep institutional knowledge on LC3 research and BIS certification.
Rathi said India’s early experience has produced clear lessons. One of the biggest was the need to build capacity among regulators. While BIS certification existed, State Pollution Control Boards were unfamiliar with the technology and unsure about the approval pathway.
“The capacity building is not just needed amongst the producer and the users of the cement, but also the regulators who are working with this technology for the first time,” he said.
He also highlighted the need for better information on China clay deposits. Since China clay is currently classified as a minor mineral, centralised data on availability, quality and location is limited. If cement manufacturers are to adopt LC3 at scale, stronger mineral intelligence will be important.
The third issue is demand. LC3 has already been used in projects such as Palava City in Mumbai and Noida International Airport, but these remain limited examples. “It is in a chicken and egg situation,” Rathi said. “Cement companies are saying we need more demand, and users are saying there is not enough cement available.”
Public procurement, he suggested, could help break this cycle. If agencies such as CPWD and other public bodies begin testing, accepting and specifying LC3, it could create the market confidence needed for cement companies to invest in production and storage.
Building codes must catch up with innovation
Dr Sunita Purushottam of GBPN India argued that material choices will determine built environment emissions over the long term, but India’s current policy signals remain fragmented. Although LC3 has received BIS recognition, she pointed out that building codes, municipal bylaws, schedules of rates and sustainability codes do not yet provide uniform guidance on low-carbon cement.
“The current cement regulations are largely prescriptive and favouring traditional materials,” she said. This limits the ability of alternative materials to compete on performance, durability and emissions.
Dr Purushottam also raised the issue of taxation. Cement, including LC3, currently falls under the same GST bracket as conventional cement. A differentiated tax structure, she argued, could help accelerate market adoption. “In order for the market to demand LC3, that differentiation in the GST could go a long way,” she said.
She noted that green building certifications such as IGBC and GRIHA are already creating demand for low-carbon materials by assigning points for embodied carbon and sustainable material use. However, she said large-scale adoption will require regulatory mandates, particularly through building codes and state-level notifications.
She also cautioned that low-carbon cement alone does not solve the entire building performance problem. A material may reduce embodied carbon, but the operational carbon of a building depends on thermal performance, design, insulation and energy use. “The energy part has two elements,” she said. “One is the embodied carbon of the material itself, and the other is the operational carbon.”
Collaboration is the bridge between invention and impact
Wattal said GCCA sees innovation as a strategic priority and works through platforms that connect industry with academia and start-ups. “There is no way we will decarbonise our sector without innovation,” she said.
However, she stressed that research must be connected to actual industry challenges. Innovations developed in isolation may fail when they encounter real-world barriers such as raw material variability, plant integration, cost, standards and finance. Start-ups, too, need industry mentorship and scale-up pathways.
Wattal also flagged the importance of finance. Even strong technologies may struggle to attract investment if there is no common understanding of bankability. “We have always put projects into, is this a bankable project? But the definition of a bankable project has never been defined,” she said.
For India, she saw strong potential in its academic and start-up ecosystem, but said the challenge lies in alignment and prioritisation. The country has the research base, industrial capacity and market size. What it now needs is a coordinated route from innovation to deployment.
There is a practical concern for cement manufacturers: how can existing plants be adapted for lower emissions without compromising reliability or commercial viability?
Kiranmai Sanagavarapu addressed, “The reliability risk in calcined clay retrofit is definitely real, but it is almost always self-inflicted. The risk arises when a new process is added to an existing circuit without properly redesigning grinding and blending configurations.”
Existing cement plants, she explained, can take two broad routes. The first is external sourcing of calcined clay combined with mill optimisation. This requires lower capital investment and can potentially move in 12 to 18 months if other conditions are in place. It may reduce emissions by around 20 to 30 per cent. The second route is integrated calcination on site, which requires higher capital expenditure and longer lead times, but provides greater control over quality, supply and emissions reduction potential.
For Sanagavarapu, the principle is simple: low-carbon retrofits must be designed with intent. “Design it with an intent properly from the start. Start in the market conditions where the economics are already working,” she said.
Circularity: The overlooked advantage
According to Vaibhav Rathi, fly ash and slag are already well established in cement and construction (C&D), but construction and demolition waste remains underutilised. “C&D waste is a growing business opportunity which not many have taken up,” he said. India’s continuous construction and demolition activity creates huge volumes of waste, much of which contributes to air pollution, land degradation and material inefficiency. With the right processing and standards, this waste can be converted into useful construction products.
Rathi also pointed out that LC3 has a circular economy dimension that is often overlooked. It can use low-grade kaolin-rich clay left behind after high-grade clay is extracted for other applications. “LC3 is not only a low-carbon solution, but also a circular economy solution,” he said.
At the same time, he cautioned that LC3 in India is not yet cheap because it has not reached scale. Site-specific techno-commercial feasibility studies, supported jointly by development agencies and industry, could help companies assess whether LC3 production makes technical and financial sense at a given location.
Dr Purushottam added that India must address both low-carbon cement and construction waste together. “Both low-carbon cement and C&D waste go hand in hand. India does not have an option but to work on both,” she said.
Dr Aiyer called for policy shifts from both government and industry, including preferential purchasing of sustainable materials, minimum supplementary cementitious material requirements in public and public-private projects, and faster regulatory implementation. “If we can fast-track the regulatory standards and their implementation on the ground, that is the way to go,” he said.
From green ambition to green construction
Cement innovation is no longer only about chemistry. It is about systems. Low-carbon cement will scale only when technology, standards, procurement, finance, regulation, education and construction practice move together.
LC3 and other low-carbon technologies have shown promise. India has early commercial examples, strong research capability and growing market interest. But mainstream adoption will depend on whether demand can be created, regulators can be capacitated, standards can be embedded in procurement, and manufacturers can see a clear business case.
For a country building at India’s scale, the opportunity is enormous. Cement will continue to be central to infrastructure and urban development. The challenge now is to ensure that the cement used in India’s growth story carries a lower carbon burden.
- Rakesh Rao
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Concrete
Indian Railways Plans Green Fly Ash Transport Network
Published
5 days agoon
June 27, 2026By
admin
Specialised rail logistics will move fly ash from power plants to infrastructure industries.
New Delhi
Indian Railways is planning a large-scale green logistics initiative to transport fly ash from thermal power plants to industries where it can be reused in infrastructure and construction activities.
The initiative was discussed during a review meeting chaired by Union Minister for Railways Ashwini Vaishnaw. Union Ministers of State for Railways V Somanna and Ravneet Singh Bittu were also present.
India generates nearly 340 million tonnes of fly ash every year from thermal power plants. The proposed initiative aims to create an efficient rail-based transport system using specialised containers and dedicated logistics arrangements to move fly ash safely from power plants to end-use industries.

Fly ash is widely used in road construction, cement manufacturing, brick production, concrete, blocks and boards. By improving its movement through the railway network, the initiative is expected to support better utilisation of this industrial by-product while reducing environmental concerns linked to storage and disposal.
The move also aligns with India’s circular economy goals by converting waste from thermal power generation into a useful raw material for the construction and infrastructure sectors. Wider availability of fly ash can help reduce material costs in areas such as bricks and cement, supporting more affordable infrastructure and housing development.
Through this initiative, Indian Railways aims to provide a cleaner, safer and more organised transport solution for fly ash, turning an environmental challenge into an infrastructure resource.
Gears, drives, and motors have evolved from essential mechanical components into strategic enablers of reliability, efficiency, and sustainability in modern cement plants. ICR explores how advanced motion technologies, predictive maintenance, digitalisation, and intelligent drive systems are helping cement manufacturers reduce downtime, optimise energy use, and build future-ready operations.
As the Indian cement industry prepares for another phase of capacity expansion, the focus is shifting from merely increasing production volumes to improving operational efficiency, reliability, and sustainability. According to industry estimates, India is expected to add nearly 160–170 million tonnes of cement capacity between FY26 and FY28, driven by infrastructure investments, urbanisation, and housing demand. In this environment, gears, drives, and motors have emerged as critical enablers of productivity, forming the backbone of every major process from raw material extraction and grinding to clinker production and cement dispatch.
Motors alone account for nearly 60 per cent to 70 per cent of industrial electricity consumption globally, according to the International Energy Agency (IEA), while rotating equipment failures remain among the leading causes of unplanned downtime across heavy industries. In cement plants, where equipment operates under high loads, extreme dust conditions, elevated temperatures, and continuous-duty cycles, the performance of gears, drives, and motors directly influences energy consumption, maintenance costs, plant availability, and overall profitability. As digitalisation and Industry
4.0 technologies gain momentum, these systems are evolving from passive mechanical components into intelligent assets capable of delivering real-time operational insights.
Why gears, drives, and motors are the backbone of cement plant operations
Every major process in a cement plant depends on the seamless operation of gears, drives, and motors. Raw mills, vertical roller mills, crushers, kiln drives, conveyor systems, fans, and clinker coolers all rely on rotating equipment to maintain continuous production. A failure in any one of these systems can disrupt entire process chains, highlighting their strategic importance.
Modern cement plants process thousands of tonnes of material daily, requiring equipment capable of transmitting enormous torque while maintaining precision and reliability. Kiln drives and grinding systems, in particular, operate under some of the highest mechanical loads found in industrial manufacturing. The ability of gears and motors to withstand these conditions directly impacts plant throughput and production stability.
Satish Maheshwari, Chief Manufacturing Officer, Shree Cement says, “Effective lubrication management remains one of the most critical factors in extending the lifespan of cement plant drive systems. Proper lubrication, supported by regular oil analysis, vibration diagnostics, and condition monitoring, helps minimise wear, prevent unexpected failures, and maintain the integrity of critical components such as gearboxes, motors, and drive assemblies. By identifying potential issues at an early stage, plants can move from reactive maintenance to a more proactive and reliability-focused approach.”
“Smart motors, intelligent drives, and next-generation gearboxes are set to redefine cement plant maintenance and performance. Equipped with embedded sensors, IoT connectivity, digital twins, and AI-driven diagnostics, these technologies enable real-time condition monitoring, predictive maintenance, and seamless digital integration. As the industry embraces Industry 4.0, smart drive systems will play a pivotal role in improving energy efficiency, reducing downtime, and optimising asset performance across the cement manufacturing value chain” he adds.
Industry studies suggest that rotating equipment accounts for a significant proportion of maintenance expenditure in process industries. Effective design, selection, and maintenance of gears, drives, and motors therefore have a direct influence on asset utilisation, operational efficiency, and total cost of ownership.
The cost of downtime: reliability challenges in rotating equipment
Unplanned downtime remains one of the most expensive challenges facing cement manufacturers. Industry estimates indicate that a major failure involving a critical gearbox, kiln drive, or grinding mill can result in production losses running into lakhs of rupees per hour, depending on plant capacity and operating conditions.
Sanjeev Arora, President – Motion Business & IEC LV Motors Division, ABB India says, “One of the most significant shifts taking place in industrial decision-making today is moving away from evaluating equipment based solely on upfront capital cost toward understanding total cost of ownership (TCO). In a typical motor system, the purchase price often represents only a small fraction of the total lifecycle cost however energy consumption, maintenance requirements, downtime and operating efficiency account for the vast majority of long-term operational expenses. For cement manufacturers operating in highly competitive markets, this distinction is critical.”
“A high efficiency motor paired with an appropriately configured variable speed drive may require a higher initial investment, but the long-term benefits are substantial. Reduced electricity consumption, lower maintenance needs, longer service intervals and improved process stability can deliver faster payback and stronger profitability over time” he adds.
Cement plants present a particularly challenging environment for rotating equipment. Dust ingress, thermal fluctuations, shock loads, vibration, shaft misalignment, and lubrication contamination contribute significantly to equipment degradation. Studies by SKF indicate that nearly 50 per cent of bearing failures are linked to lubrication issues and contamination, while improper alignment and vibration-related problems remain leading causes of gearbox and motor failures.
Energy-efficient motors and drives: unlocking operational savings
Energy is one of the largest operating expenses for cement manufacturers, often accounting for 25 per cent to 35 per cent of total production costs. Grinding operations alone can consume nearly 60 per cent to 70 per cent of a plant’s electrical energy, making energy-efficient motors and drives a strategic investment.
According to the International Energy Agency, high-efficiency motors combined with Variable Frequency Drives (VFDs) can reduce energy consumption by 20 per cent to 30 per cent in suitable applications. By matching motor speed and torque to actual process requirements, VFDs minimise unnecessary power consumption while reducing mechanical stress on equipment, improving both efficiency and reliability.
Advances in gearbox design and power transmission technologies
Modern gearbox technology has evolved significantly in response to the increasing demands of cement manufacturing. Advanced materials, case-hardened gears, optimised tooth profiles, improved surface finishing, and enhanced lubrication systems are helping reduce friction, wear, and thermal loading.
Girish Hanchate, Director – Industrial Market, India SKF India (Industrial) says, “Smart diagnostics are significantly improving the lifecycle of gears, motors, and other rotating equipment by enabling a shift from reactive maintenance to condition-based asset management. Hidden issues such as vibration anomalies, bearing defects, misalignment, and temperature fluctuations can quietly reduce plant throughput by 10 per cent to 20 per cent while increasing energy consumption long before a breakdown occurs. By leveraging advanced sensors, predictive analytics, machine learning, and real-time monitoring of vibration, temperature, and motor current, cement manufacturers can detect developing faults early, optimise maintenance schedules, and prevent costly secondary damage. This not only improves reliability but also supports energy efficiency and sustainability objectives.”
“The next major evolution in drive and bearing technology lies in the development of fully integrated smart mechanical ecosystems that combine high-performance bearings, advanced lubrication management, and digital intelligence. Sensor-enabled condition monitoring embedded directly within bearings and drive systems allows operators to capture critical operational data at the source, enabling predictive maintenance and real-time performance optimisation. Innovations such as SKF’s VA9A1 Spherical Roller Bearing series, engineered specifically for demanding cement applications such as crushers and kilns, demonstrate this trend. By increasing internal bearing space and optimising lubricant flow, these designs improve grease retention, reduce wear, minimise downtime, and create more resilient, energy-efficient rotating equipment systems for the future of cement manufacturing” he adds.
Manufacturers are increasingly focusing on compact, high-torque gearbox designs capable of delivering higher power density while maintaining service life. Innovations such as condition-monitored gear systems, improved sealing technologies, and modular gearbox architectures are simplifying maintenance while enhancing operational reliability.
Predictive maintenance, condition monitoring, and asset health management
The shift from reactive to predictive maintenance is transforming asset management across the cement industry. Technologies such as vibration monitoring, thermography, oil analysis, ultrasound testing, and motor current signature analysis are enabling operators to identify potential failures before they occur.
Research by Deloitte suggests that predictive maintenance can reduce breakdowns by up to 70 per cent and lower maintenance costs by 25 per cent. In cement plants, where shutdown windows are limited and equipment operates continuously, predictive maintenance offers a powerful tool for improving reliability and extending asset life.
Digitalisation, industry 4.0, and the rise of intelligent drive systems
Industry 4.0 technologies are redefining the role of gears, drives, and motors. Smart sensors embedded within motors, bearings, and gear systems can continuously monitor temperature, vibration, load, lubrication condition, and energy consumption.
Girish Hanchate says, “As the industry embraces automation, sustainability, and digital transformation, the importance of intelligent motion technologies will continue to grow. The convergence of advanced engineering, predictive maintenance, and Industry 4.0 solutions is creating a new generation of cement plants where reliability, efficiency, and sustainability work together to deliver long-term value. For cement manufacturers navigating increasing production demands and environmental expectations, investing in smarter gears, drives, and motors is no longer optional—it is a business imperative.”
Cloud-based monitoring platforms and Industrial Internet of Things (IIoT) architectures enable maintenance teams to access equipment health data remotely, improving visibility across geographically dispersed operations. Advanced analytics and
artificial intelligence are further enhancing fault detection capabilities, enabling more accurate maintenance planning.
The emergence of digital twins represents another significant development. By creating virtual replicas of physical assets, operators can simulate operating conditions, predict failures, optimise maintenance schedules, and improve lifecycle management decisions. These technologies are helping transform rotating equipment into intelligent assets that actively contribute to operational decision-making.
Building future-ready cement plants through smart motion technologies
The future of cement manufacturing will depend heavily on the ability to integrate mechanical reliability with digital intelligence. Smart motion technologies combine high-efficiency motors,
intelligent drives, condition monitoring systems, and automation platforms to create more responsive and efficient operations.
Sustainability goals are also accelerating investment in advanced motion technologies. Reduced energy consumption, improved equipment efficiency, and extended asset life contribute directly to lower carbon emissions and reduced resource consumption.
These benefits align closely with the industry’s decarbonisation objectives.
As capacity expansions continue across India, future-ready cement plants will increasingly prioritise reliability, flexibility, and data-driven decision-making. Organisations that successfully integrate smart motion technologies into their operations will be better positioned to reduce costs, improve productivity, and maintain a competitive advantage in a rapidly evolving market.
Conclusion
Gears, drives, and motors are no longer viewed solely as mechanical components; they have become strategic assets that influence every aspect of cement plant performance. Their reliability affects production continuity, their efficiency impacts operating costs, and their digital capabilities increasingly shape maintenance and operational strategies.
- –Kanika Mathur
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