Published On: Sun, Sep 24th, 2017

Cement: Distributors, consumers explain Dangote’s dominance

 

EMEKA EJERE

As Nigeria continues to grow in the area of real estate, one item that is increasingly favoured is cement, given its indispensability in building construction from the foundation to the finishing.

But among the cement brands, BusinessHallmark’s investigations revealed that a number of factors are in favour of Dangote Cement, which explain the phenomenally high market share the brand controls in the Nigerian space.

A tour round Akute area of Ogun State, a fertile ground for investment in housing revealed that both distributors and users of cement are in love with Dangote Cement for diverse reasons.

Our team amazingly discovered that all the cement shops around Akute have only Dangote Cement in display as, according to the dealers, it sells much faster than Elephant Cement.

More intriguing, however, is the discovery that while most of the respondents were in agreement that Elephant Cement is harder and better when dried, the fact that it takes time to dry gives its rival Dangote Cement the advantage of selling faster, especially during the rainy season.

Mrs. Bola Adeboye is the secretary of Guide Me Investment, a heavy cement distributor in Akute. She said her company used to distribute both Dangote and Elephant many years ago but at a point decided to limit their business to only Dangote when it became obvious that the latter was the choice cement in the area.

“We were distributing both Dangote and Elephant before now but noticed that because of the humid nature of this area, people do not buy Elephant as it takes time to dry,” Mrs. Adeboye explained.

She, however, added that those who do not mind (though very few) still go for Elephant, which she said is stronger than Dangote.

The story is not any different at Sekoni Investment, another dealer. The proprietor, Mr. Tunde Ajayi, noted that he sells only Dangote because that is what people ask for in the area.

“We sell only Dangote because that’s what people ask for. Most of them say that is what their bricklayers or engineers recommended,” said Ajayi.

At Divine Favour Investment, Mrs. Funmi Sokefun, corroborated the views of her colleagues, observing that Dangote is synonymous to cement in Akute.

She noted that though experience had shown that Dangote dries faster than Elephant, many buyers do not even have any reason for preferring Dangote other than the fact that it is what everybody is buying.

Our team also visited a number of block industries in Akute where findings still spoke in favour of Dangote Cement.

Mr. Emmanuel Olanrewaju, is the Managing Director of Ire Akari Block Industry. He told Business Hallmark that he uses Danote Cement because it is good and dries faster.

“Elephant is also good. In fact, it’s even better. It is the master. But the only problem is that Elephant takes time to dry,” Olanrewaju said.

When asked if buyers of block bother about the brand of cement used, Mr. Olanrewaju said, “No, there is nothing like that. All cements are good.”

Rashtona Construction Company, Akute is slightly of a different position in terms of choice of cement. It uses only Dangote during rainy season but can use either of the two brands during dry season.

A senior staff of the company, Mr. Sunday Aloba, explains: “We use Dangote because it dries faster during rainy season. But now that dry season is gradually setting in, we are beginning to also use Elephant.

A 50 kilogram bag of the cement brands goes for between N2,520 and N2,600 depending on quantity of purchase or scale of operation of the seller.

The high demand for Dangote Cement cuts across the African continent. According to the unaudited results of the company for the period spanning January to June 2017, Ethiopia is leading Africa in the consumption of cement manufactured by the Dangote Group.

The East African giant took in a total of 1.1 million metric tons of Dangote Cement with the second African country being Senegal where 0.6 million metric tons of the product was sold.

Generally, the cement producer announced a spike in its sales volume across the continent despite a drop in sales in Nigeria. The company continues expansion across the continent with plants in different countries.

Dangote Cement’s Chief Executive Officer, Onne van der Weijde is quoted to have said, ‘‘Our Pan-African operations are growing well and increasing market share. We saw our first sales from Sierra Leone in the first quarter and our new plant in the Republic of Congo will be in production at the end of July, further increasing our footprint across Africa and strengthening our position as its leading manufacturer of cement.”

Other records of trade volumes across Africa were 0.6 million metric tons sold in Cameroon, and 0.5 million tons in Ghana. Also, 0.4 million metric tons of cement was sold in Tanzania and 0.3 million tons in Zambia.

The company explained the fall in sales volumes from Nigerian operations putting it down to onset of rains which stalled many construction projects. It fell from 8.8Mt same time last year to 6.9Mt.

“Our revenues have continued to grow despite the lower volumes seen in Nigeria, especially because of the recent heavy rains. Our margins have improved significantly, helped by improved efficiencies and a much better fuel mix in Nigeria.

“We are using much more gas and increasing our use of coal mined in Nigeria, thus reducing our need for foreign currency and supporting Nigerian jobs,” he stressed.

Dangote cement is Africa’s largest cement company with plants in Nigeria, Senegal, Ghana, Cameroon, Ethiopia, Zambia, Tanzania & South Africa.

Last week, the cement giant approached PPC Ltd. about a takeover deal, signaling the start of a possible bidding war for South Africa’s biggest cement maker after an earlier offer led by Canada’s Fairfax Financial Holdings Ltd.

Dangote Cement Plc is a Nigerian multinational publicly traded cement manufacturer headquartered in Lagos. The company is engaged in the manufacture, preparation, import, packaging, and distribution of cement and related products across the African continent.

Dangote Cement Plc was formerly known as Obajana Cement Plc and changed its name to Dangote Cement Plc in July 2010. Obajana Cement Plc was incorporated in 1992.

It is a subsidiary of Dangote Industries Limited and is the largest company traded on the Nigerian Stock Exchange. In 2013, the company produced and sold 13.3 million metric tonnes of cement, with revenues of US$2.4 billion.

As of 2014, Dangote Cement had a market capitalization of $20 billion. In 2012, Forbes Africa named Dangote Cement as one of the top five listed companies in West Africa.

 

© 2017, Hallmarknews. All rights reserved. Reference and link to this site is required if you wish to reuse any article.

Reactions from Facebook

comments and opinions

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Got news for us?

Most Shared

Recent posts

  • Afrinvest set to release 2018 Banking Sector Report on Oct. 22

    Afrinvest (West Africa) Ltd will on October 22, 2018, in Abuja present the 2018 edition of its Annual Nigeria Banking Sector Report to the public. The report titled “An Economic Agenda for a New Government” presents a viable economic roadmap for Nigeria in 2019 and will be launched at the Shehu Musa Yar’Adua Centre, Abuja. […]

  • UBA posts N79bn pre-tax profit for Q3 2018

    United Bank of Africa Plc retained a remarkable growth in profitability for the unaudited nine months financial result and accounts September 30, 2018, with profit before tax closing at N79 billion. The pan-African financial institution reported N78 billion amid a challenging environment. The financial institution in its result to The Nigerian Stock Exchange (NSE) on Tuesday also […]

  • Inflation rate accelerates to 11.28% in Sept

    The Consumer Price Index, (CPI) which measured inflation for September increased to 11.28 per cent (year-on-year) from 11.23 per cent recorded in August, the National Bureau of Statistics (NBS) said on Tuesday. Latest inflation data from for September released by the NBS in Abuja showed that inflation rate was 0.05 per cent points higher than […]

  • Medium, large capitalized stocks return bulls to equity market

    Gains recorded by medium and large capitalized stocks helped the Nigerian Stock market to reverse Monday’s negative sentiment, appreciating 0.95 per cent on Tuesday. The All Share Index (ASI) increased by 308.70 absolute points, representing an increase of 0.95 per cent close to 32,722.18 points. Also, the Market Capitalization was up N112.70 billion, which was […]

  • NSE Wins Best Use of Technology for Efficiency Award

    The Nigerian Stock Exchange (NSE) has received the 2018 Best Use of Technology for Efficiency Award from Nigeria Tech Innovation & Telecom Awards 2018 (NTITA). The NTITTA is the most celebrated industry awards for the Technology and Telecom industries attracting top decision makers in the sectors. The annual event is held to showcase excellence and celebrate the continued growth […]

  • Super Eagles beat Libya, top Group E

    The Super Eagles now stay at the top of their group standings as they endured a scare in Tunisia to claim a third consecutive victory An Odion Ighalo-inspired Nigeria secured a 3-2 victory over Libya to move to the top of Group E in their 2019 African Cup of Nations qualifiers in Sfax. Goal.com reports […]

  • NDLEA FCT nabs 147 drug dealers, seizes $1.9m in one month

    The National Drug Law Enforcement Agency (NDLEA), FCT Command, said on Tuesday that it arrested 147 suspected drug dealers and seized various consignment of drugs. Mrs Chinyere Obijuru, Commander, NDLEA FCT Command, told newsmen in Abuja that the command in its sting operation that commenced on September 1, also seized fake 100 dollar bills amounting […]

  • PENGASSN tasks govt on quick minimum wage resolution

    The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has urged the Federal, state governments and organised private sector to resolve the differences in the ongoing negotiation for a new minimum wage in the country. The National President of the Union, Mr Olabode Johnson made the appeal while addressing newsmen on its planned […]

  • Court nullifies Unity Bank Executive Director’s sack

    The National Industrial Court, sitting in Ikoyi, Lagos State, on Monday voided the termination of employment of Mrs Arese Alonge, declaring her a subsisting Executive Director of Unity Bank. The court ordered the bank to pay all entitlements and benefits that pertain to her office. Alonge had on Feb. 11, 2015 instituted a suit against […]

  • Traders tasks politicians on accountability

    The National Association of Nigerian Traders (NANTS) has called for accountability from in-coming governments, insisting that they must keep their promises. President of the association, Mr Ken Ukaoha, made the call at the public presentation of “Framers Manifesto and Traders Charter Demands’’ in Abuja on Monday. “We are gradually coming back to our senses to […]

  • Kayode Fayemi and the Ekiti conundrum

    By TESLIM SHITTA-BEY Ekiti state’s newly elected governor Kayode Fayemi is a brilliant conversationalist and an engaging debater. Nevertheless, with the state he is about to take over as governor locked within a time capsule of slow growth; the usually voluble gentleman will have no time for banter. According to Emmanuel Aremu indigene of Ondo […]

  • The Buhari era:  How the president is reshaping Nigeria after his own image

     By AYOOLA OLAOLUWA On May 29, 2015, President Muhammadu Buhari assumed office, and there were great expectations from Nigerians. While campaigning, the Daura-born president centred his campaign on five focal points: building the nation’s infrastructures, job creation, revamping the economy, providing security and fighting corruption. After 16 years of dashed hopes under successive Peoples Democratic […]

  • Economy : IMF forecast signposts tougher times

    By FELIX OLOYEDE  Experts have noted that the reduction in the International Monetary Fund’s (IMF) growth outlook for the Nigerian economy in 2018 presages a rise in the jobless rate as the economy head into a new year.  The IMF cut the country’s growth projections for this year from 2.1percent to 1.9 percent, arguing that […]

  • Tinubu launches early start to 2023 bid

    By OBINNA EZUGWU  Having, in his reckoning, secured the structure of the ruling All Progressive Congress with his long time ally, Comrade Adams Oshiomhole as chairman, and President Muhammadu Buhari now guaranteed to run for second term in office, and quite possibly, retain power, former Lagos governor, Senator Bola Ahmed Tinubu have begun strategic positioning […]

  • 2019: Peter Obi’s choice ruffle feathers

    By OBINNA EZUGWU  The emergence of former vice president, Alhaji Atiku Abubakar as presidential candidate of the People’s Democratic Party (PDP) dominated the political space last week. Many have continued to argue that the former vice president remained the only candidate with the requisite resources, reach and experience to defeat the incumbent President Muhammadu Buhari […]

  • APC primaries: Party crisis may consume Oshiomhole

    By OBINNA EZUGWU National Chairman of the All Progressives Congress, Comrade Adams Oshiomhole did apparently, make a kill with the recently concluded primary elections of the ruling party. Nomination and expression of interest forms were sold at exorbitant prices – ranging from N45million for presidency to N850,000 for state House of Assembly – and many […]



read more...