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A proactive approach facilitates smooth operations

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Prashant Jha, Chief Ready-Mix Concrete and Modern Building Materials Officer, Nuvoco Vistas, stresses the importance of efficiency and reliability in transportation while discussing other intricacies of RMX logistics management.

Tell us about the transportation model followed by your organisation for RMX despatches.
Our transit mixers transport concrete from our production plants to customer sites, selecting capacities ranging from 6 to 9 cu m depending on factors like city location, site specifics, and market dynamics. These transit mixers are sourced from third-parties as per the business requirement that is determined through our Integrated Business Planning (IBP) process. Given the variability of daily volumes, we can experience sudden spikes in demand, which is addressed through our fleet with short-term ‘taxi resources’ promptly and efficiently. This agile approach allows us to adapt swiftly to fluctuating demands while maintaining high service standards.

How are the logistics of the plant managed?
The plant’s monthly sales volume targets are established through the IBP process, for guiding to the formulation for enabling efficient resource management. Following the determination of monthly volumes, the transit mixer plan is finalised for each facility. The plant teams collaborate with the customer and sales team to ensure strategic delivery schedules adherences. Any issues are addressed in consultation with customers by a collaborative effort between plant manager, customer and the sales team to ensure the daily delivery targets are met effectively. A proactive approach facilitates smooth operations and customer satisfaction.

With new technology and digitalisation introduced in the system, what impact has it created on the efficiency and cost of the plant?
Our implementation of a Vehicle Tracking System (VTS) in our transit mixers, coupled with Drum Rotation Sensors and GPS integration, has revolutionised our operational efficiency. This advanced technology empowers our plant to monitor transit mixers in real-time, facilitating agile planning for subsequent deliveries and enabling us to provide customers with precise updates on delivery status. Moreover, by leveraging GPS data, we ensure fair variable cost payments based on accurate kilometres travelled, optimising cost management. In addition to enhancing financial transparency, the VTS enables our plant teams to track driver behaviour, allowing us to provide timely feedback and targeted training on safe work practices. This hands-on approach not only improves the safety of concrete transportation but also fosters a culture of continuous improvement within our workforce.
Furthermore, by capturing transit mixer performance data, we gain valuable insights into operational efficiency, enabling us to implement strategic enhancements and maximise productivity. Overall, our integrated system of VTS, Drum Rotation Sensors and GPS technology represents a comprehensive solution that not only enhances operational efficiency and cost-effectiveness but also prioritises safety and continuous improvement in our transportation processes.

What are the key steps that can be taken to further improve the logistics of RMX manufacturing and transportation?
Given our extensive operations across major cities, ensuring the continuous supply of Ready-Mix Concrete (RMX) is essential. Road movement and safety remain a critical area. Adherences to lanes, dedicated infrastructure for heavy vehicle movement would enhance safety for both transit mixers and other vehicles on the road. These changes would facilitate faster and more efficient movement of these vehicles and would significantly contribute to improving overall transportation logistics and infrastructure management in urban environments, promoting economic productivity and sustainable development.

Tell us about the challenges in logistical planning for RMX plants…
Effectively addressing spike volume demand involves proactive resource allocation through predictive analytics and close collaboration with vendors. This includes strategic coordination with local authorities and route planning while managing traffic disruptions in mega cities. To mitigate high waiting times at sites and prevent concrete buildup inside transit mixer bowls, optimising delivery schedules, enhancing on-site logistics and investing in technologies like automated batching systems are important.
These measures collectively ensure timely deliveries while minimising operational challenges and disruptions.

  • Kanika Mathur

Concrete

Construction Costs Rise 11% in 2024, Driven by Labour Expenses

Cement Prices Decline 15%, But Labour Costs Surge by 25%

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The cost of construction in India increased by 11% over the past year, primarily driven by a 25% rise in labour expenses, according to Colliers India. While prices of key materials like cement dropped by 15% and steel saw a marginal 1% decrease, the surge in labour costs stretched construction budgets across sectors.

“Labour, which constitutes over a quarter of construction costs, has seen significant inflation due to the demand for skilled workers and associated training and compliance costs,” said Badal Yagnik, CEO of Colliers India.

The residential segment experienced the sharpest cost escalation due to a growing focus on quality construction and demand for gated communities. Meanwhile, commercial and industrial real estate remained resilient, with 37 million square feet of office space and 22 million square feet of warehousing space completed in the first nine months of 2024.

“Despite rising costs, investments in automation and training are helping developers address manpower challenges and streamline project timelines,” said Vimal Nadar, senior director at Colliers India.

With labour costs continuing to influence overall construction expenses, developers are exploring strategies to optimize operations and mitigate rising costs.

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Concrete

Swiss Steel to Cut 800 Jobs

Job cuts due to weak demand

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Swiss Steel has announced plans to cut 800 jobs as part of a restructuring effort, triggered by weak demand in the global steel market. The company, a major player in the European steel industry, cited an ongoing slowdown in demand as the primary reason behind the workforce reduction. These job cuts are expected to impact various departments across its operations, including production and administrative functions.

The steel industry has been facing significant challenges due to reduced demand from key sectors such as construction and automotive manufacturing. Additionally, the broader economic slowdown in Europe, coupled with rising energy costs, has further strained the profitability of steel producers like Swiss Steel. In response to these conditions, the company has decided to streamline its operations to ensure long-term sustainability.

Swiss Steel’s decision to cut jobs is part of a broader trend in the steel industry, where companies are adjusting to volatile market conditions. The move is aimed at reducing operational costs and improving efficiency, but it highlights the continuing pressures faced by the manufacturing sector amid uncertain global economic conditions.

The layoffs are expected to occur across Swiss Steel’s production facilities and corporate offices, as the company focuses on consolidating its workforce. Despite these cuts, Swiss Steel plans to continue its efforts to innovate and adapt to market demands, with an emphasis on high-value, specialty steel products.

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Concrete

UltraTech Cement to raise Rs 3,000 crore via NCDs to boost financial flexibility

UltraTech reported a 36% year-on-year (YoY) decline in net profit, dropping to Rs 825 crore

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UltraTech Cement, the Aditya Birla Group’s flagship company, has announced plans to raise up to Rs 3,000 crore through the private placement of non-convertible debentures (NCDs) in one or more tranches. The move aims to strengthen the company’s financial position amid increasing competition in the cement sector.

UltraTech’s finance committee has approved the issuance of rupee-denominated, unsecured, redeemable, and listed NCDs. The company has experienced strong stock performance, with its share price rising 22% over the past year, boosting its market capitalization to approximately Rs 3.1 lakh crore.

For Q2 FY2025, UltraTech reported a 36% year-on-year (YoY) decline in net profit, dropping to Rs 825 crore, below analyst expectations. Revenue for the quarter also fell 2% YoY to Rs 15,635 crore, and EBITDA margins contracted by 300 basis points. Despite this, the company saw a 3% increase in domestic sales volume, supported by lower energy costs.

In a strategic move, UltraTech invested Rs 3,954 crore for a 32.7% equity stake in India Cements, further solidifying its position in South India. UltraTech holds an 11% market share in the region, while competitor Adani holds 6%. UltraTech also secured $500 million through a sustainability-linked loan, underscoring its focus on sustainable growth driven by infrastructure and housing demand.

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