India Cements profit more than doubles to ₹37 cr in Q1

Our Bureau Chennai | Updated on August 11, 2021

N Srinivasan, Vice-Chairman and Managing Director   -  KSL

Production higher at 18.88 lakh tonne

India Cements has more than doubled its standalone net profit at ₹37 crore for the quarter ended June 30, compared with net profit of ₹17 crore in the year-ago quarter.

However, the June quarter profit was lower than the preceding quarter’s (March 2021) net profit of ₹72 crore.

The net plant realisation (NPR) for Q1 was lower than that of last year by 7 per cent due to mix of sales as home markets were affected very badly but it was higher compared to the sequential quarter by 7 per cent.

NPR for June 2021 quarter was ₹3,942 per tonne compared with ₹4,235 in the year ago quarter, mainly due to the higher freight cost as the company had to carry cement to long distances.

“This Q1 was also like last Q1 due to the second wave of the pandemic. Last time we had 35 per cent capacity utilisation. But this time it was slightly more at 50 per cent. This time we had also gone to Maharashtra as well as eastern region to sell cement. This is the reason that although prices didn’t drop, NPR was lower due to higher freight costs,” N Srinivasan, Vice-Chairman and Managing Director of the company, said.

EBIDTA stood at ₹165 crore compared to ₹159 crore in the year-ago quarter, helped by increased volume amid drop in net plant realisation and increased cost pressure.

Though there was cost increase due to coal and fuel, it was mitigated by containing fixed costs, which were reduced to ₹150 crore per quarter compared with earlier level of ₹195 crore per quarter.

Its revenue from operations grew to ₹1,022 crore against ₹757 crore. Total expenses stood at ₹969 crore compared to ₹734 crore in Q1 of the previous fiscal.

The company’s cement production was higher at 18.88 lakh tonne (13.43 lakh tonne) and overall volume (including clinker) was at 19.45 lakh tonne (14.28 lakh tonne). However, the volume was lower by nearly 35 per cent on a sequential basis.

"I am of the view that economic activity will not be hurt despite the threat of third wave. Because vaccinations have been substantial, and it continues to improve. In Q1, wherever the lockdown was lifted, demand for cement was there. Going by that, if the lockdown is eased substantially, there is a good possibility of demand revival,” Srinivasan added.

Published on August 11, 2021

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