Riding on the back of volume growth and price hikes, JK Lakshmi Cement Ltd reported a 28 per cent increase in net sales in the quarter ended March 2012 to Rs 526.33 crore.
The company registered net sales worth Rs 411.95 crore in the year-ago period.
The net profit, however, dipped 5.2 per cent, as the company has changed the method of providing for depreciation on captive power plants.
This change means an additional depreciation charge of Rs 63.68 crore that has brought down profit after tax, by Rs 43.02 crore for the quarter.
The operating profit at Rs 146.82 crore during the quarter jumped 63 per cent from Rs 89.96 crore (profit before income, depreciation and tax) in the year-ago period, a company release said.
“At present, the outlook for the on-going quarter does not look too good as the railway freight hike is hurting us and there is an over-supply in the sector of 22 per cent, restricting our ability to raise prices,” said Mr Shailendra Chouksey, Whole-time Director, JK Lakshmi Cement.
The company registered a healthy 14 per cent growth in volumes compared with the sector's growth of 6.9 per cent.
“The increase in Government outlay in the infrastructure sector by 20 per cent is likely to contribute 2-3 per cent to the sectors growth in the ongoing quarter,” he added.
Expansion plans
The company has put aside a total capital expenditure of Rs 1,600 crore over the next two years for expansion. Out of this corpus, Rs 1,000 crore would be raised by debt and the rest through internal accruals.
Ms Vanita Singhania, Managing Director, JK Lakshmi Cement, said, “The company has commissioned a grinding unit in Haryana in April and is also working at a greenfield project at Durg, Chhattisgarh, which will be ready by October 2013. The company is further augmenting the capacity of its kilns in Rajasthan. On completion of these projects, the company's cement capacity is expected to move up to 8.5 million tonnes by October- December 2013.”
The company has also commissioned an aerated concrete block in Haryana which will be functional by the end of current fiscal year.