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Birla Corporation Ltd, the flagship company of the MP Birla Group, registered 179 per cent growth in standalone net profit at ₹78 crore for the quarter ended June 30, in spite of volumes bearing the brunt of the lockdown in the first two months of the quarter. Net profit stood at ₹28 crore in the same period last year.

Revenue from operations on a standalone basis increased 47 per cent to₹1,135 crore during the quarter under review, against ₹774 crore during the same period last year.

The company sold 3.35 million tonnes of cement in the June quarter, a growth of more than 38 per cent YoY, but sales by volume were eight per cent lower than the pre-pandemic levels in Q1FY-20.

On a consolidated basis, profit was up by nearly 115 per cent at ₹142 crore (₹66 crore). The consolidated revenue from operations during the quarter was up 43 per cent at ₹1,749 crore (₹1,222 crore).

Despite significant pressure on costs led by soaring commodity prices, the margins at ₹1,001 per tonne were up two per cent on a year-on-year basis and seven per cent on a quarter-on-quarter basis. This is on the back of several measures undertaken by the management, including rationalisation of operating costs with a sharp focus on plant efficiency, fixed costs and logistics thereby achieving substantial savings, the company said in a press statement. EBITDA rose 40 per cent year-on-year to ��353 crore.

Focus on premium offerings

Birla Corp has been able to protect realisation by focusing its sales and marketing initiatives on premium products.

“The company managed to scale up sales of its premium products to a record high to claim a 51 per cent share of sales by volume through the trade channel in the June quarter. This was the key to shoring up realisation,” the release said.

Realisation per tonne for the June quarter at ₹4,933 a tonne was up at pre-pandemic levels and a tad higher (less than one per cent) than the same period last year, despite contraction in cement prices in recent months in the central and northern markets. Capacity utilisation during the quarter was around 90 per cent.

Indicating the possibility of a price hike, Arvind Pathak, Managing Director and Chief Executive Officer, said, “A good kharif crop should boost farm income and as the monsoon abates, it is expected that cement companies will be able to pass on a portion of substantial price increase in input costs.”

The company had recently revised the capital expenditure for setting up of a 3.90 million tonnes greenfield integrated cement plant at Mukutban in Maharashtra to ₹2,744 crore from the initially envisaged ₹2,450 crore. The capex was increased following revision in project commencement schedule and other factors including increase in commodity prices. The company is looking to ramp up manpower availability at the Mukutban project and hopes to complete it in the “shortest possible time frame”.

The company’s scrip closed at ₹1,387.80, up 1.86 per cent, on the BSE on Thursday.

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