Abstract
Cement Industry of India is one of the oldest in the country. The economic liberalization made all the cement-making companies expand their capacity from the latter part of the last decade of the 20th Century. Cement majors in the country started adding to capacity and faced the glut situation of excess capacity and lower demand during the beginning of the 21st Century. Input cost escalation together with increased interest burden affected the top line and bottom line respectively. On account of the Government policy to boost the infrastructure sector from the middle part of the first decade of the 21st century, the demand for construction materials had shown phenomenal growth, and cement majors started earning sufficient returns on investment. This study takes the second largest cement manufacturer in South India, Madras Cements Limited for 13 years between 1999-00 and 2011-12 and analyses the earnings at various stages from sales through contribution, operating profits, and earnings before tax to evidence support the glut and balanced phases by recording normal earnings performance and best performance at respective phases identified.
Keywords: Earnings, Contribution, Operating profit, Earnings before tax, Interest cover, Glut
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