Corporate honchos from Gujarat are talking about their achievements and the overall India growth story in the special programme ‘Bloomberg Hotspot Gujarat’. Bloomberg TV India spoke to Alok Sanghi, Director of cement major Sanghi Industries, to get a view of his experience and the way forward.

What has been your experience when we talk about operating in Gujarat? How have you seen the growth story?

Gujarat is an outperformer. If we look at the country’s average, in terms of consumption, in terms of GDP growth, Gujarat has been an outperformer for the past decade.

What about Sanghi Industries specifically? Let’s talk about your growth story specifically because you are one of the key players when it comes to cement in this part of the country. Take us through how you evolved over the last couple of years.

We started in 2003, predominantly as an exporter, and we used to sell in Gujarat.

Three to four years ago we decided that we needed to diversify our markets. Today, we are not only present in Gujarat, but also in Maharashtra and Rajasthan. We continue to export, but a majority of our production is now shifted into the domestic market.

Over the last three-four years, we have added new products to our portfolio. We are becoming increasingly focused on blended cement.

We have added coastal shipment as a major strategy for the group going forward. By doing so we are able to reach markets far away from Gujarat and therefore able to maintain the same profitability. So these are the two biggest drivers which have happened over the last fewyears.

You mentioned moving into three supply chain benefits. Take us through what kind of benefits you are talking about.

If you notice, most cement players operate in a (particular) region, probably about 500 km or a maximum of 700 km from the location (of production). And that is because cement is an extremely low-cost product and therefore freight is a big component of the delivered price.

By using coastal shipping, which is the most inexpensive mode of transport, we have been able to reach markets which are far beyond the ‘natural’ markets.

To give you an example, the cost to Mumbai for us by sea is equivalent to reaching Ahmedabad by road. So from that perspective I am able to open up a whole new market in Mumbai at the same cost of cement delivered to Ahmedabad.

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