Stable cement prices and stringent control on costs have contributed to India Cements' net profit in the first quarter of the current year, quadrupling as compared with that of the corresponding quarter last year.
For the quarter ended June 30, 2011, the company has reported a net profit of Rs 102.03 crore (Rs 24.98 crore) on net sales of Rs 1,056.82 crore (Rs 880.69 crore).
Mr N. Srinivasan, Vice-Chairman and Managing Director, India Cements, told media persons that the growth in net profit was backed by a recovery in selling prices and cost reduction achieved through better blending and reduction in power and fuel consumption.
Stagnating demand
However, demand across the various markets has been stagnating due to various reasons. Gross realisation was up at Rs 4,150 a tonne against Rs 3,216 in the comparable quarter. Clinker production was lower at 17.07 lakh tonnes (21.21 lakh tonnes) and sales of cement 23.11 lakh tonnes (26.52 lakh tonnes). The capacity utilisation at its units was about 67 per cent on a total installed capacity of over 15 million tonnes.
Group co expansion
Responding to a query on Coromandel Sugars, a group company, Mr Srinivasan said that its sugar unit is set to be expanded at a cost of Rs 180 crore. The 4,000 tonne a day sugarcane mill is to be expanded to 5,000 tonnes at a cost of Rs 20 crore.
The cogeneration unit will be upgraded to 30 MW with a high pressure boiler at a cost of Rs 100 crore. A 40 kilolitre a day distillery will also be established at a cost of Rs 60 crore.
On the NSE, India Cements' shares of Rs 10 closed at Rs 72 against the previous close of Rs 69.80.