Changes in the Board of Directors of Holcim Ltd

Changes in the Board of Directors of Holcim Ltd
Published: 16 April 2008

The Board of Directors of Holcim Ltd will be proposing to the Annual General Meeting on May 7, 2008 that Christine Binswanger and Robert F. Spoerry be elected to the company’s most senior supervisory body to replace Willy R. Kissling and Gilbert J. B. Probst, who have opted not to stand for re-election. Board members Andreas von Planta and Erich Hunziker will be standing for re-election for a further three years.

The company’s articles of incorporation stipulate that the terms of office of the members of the Board of Directors of Holcim Ltd are scheduled such that every year the term of office of approximately one third of the members expires.

Ban on cement exports to dent majors’ toplines With the government banning cement exports, revenues of major cement exporters will be dented by about Rs 1,000 crore. Two cement exporters, Ultratech and Ambuja Cement, in separate statements to the Bombay Stock Exchange on Monday, said their revenues are likely to be impacted.

Ambuja Cement said the company exported about 1.32 million tonne of cement worth about Rs 277.48 crore in FY 2007. Similarly, Ultratech’s 10% revenues come from cement exports. Going by Ultratech’s nine-month turnover, 10% would come to about Rs 392 crore, approximately. Hence, the two Companies, together, will take a hit of more than Rs 670 crore.

“India exported about 3.5 million tonne cement last year. And with international cement prices at about Rs 2,500 per tonne, the Companies will take a revenue hit of about Rs 875 crore. However, if we include the ban on clinkers as well, then there will be a revenue hit of about Rs 1,000 crore to Rs 1,200 crore,” said a Mumbai-based analyst.

Moreover, prices are likely to decline on account of the excess capacity flowing back into the domestic market.

Says Pratima Swaminathan, an analyst with Morgan Stanley Research, “The manufacturers based in the wstern region, especially Gujarat, would be the worst hit, as 91% of India’s exports are from the state. With almost 3.3Mt flowing back to the region due to the export ban, we see a pricing decline in the western region, which are currently at Rs 231 a bag.’’

Similarly, prices in the northern region might also decline, as the excess supply from the western region would flow to the north, say experts.

However, industry players also maintain that there is already a decline in the export of cement due to better profitability in the domestic market.