Ramco Cements has conserved its net profit in the first quarter of the current fiscal in line with that of the comparable previous quarter despite tough conditions in its core market.

The company has also announced a ₹1,095-crore expansion of its cement grinding capacities that will strengthen its presence in the eastern region. This will be funded through internal accruals.

Ramco Cements has kept a tighter rein on costs as compared with its peers, contained financial costs and marketed cement further afield to protect its sales volume and profits, said AV Dharmakrishnan, CEO.

For the quarter ended June 30, the company reported a net profit of ₹155.81 crore (₹155.93 crore) on a revenue of ₹1,194 crore (₹1,123.97 crore). Interest outgo has nearly halved to ₹15.45 crore (₹29.14 crore).

Total expenses were on the increase at ₹985.78 crore (₹913.36 crore), driven by transportation and handling costs of ₹199.94 crore (₹177.17 crore) and power and fuel costs of ₹168.13 crore (₹129.26 crore).

Cement consumption in Tamil Nadu, its core market, had taken a beating due to extended drought and shortage in supply of sand for construction during the quarter.

Ramco Cements reported a small increase in overall sales volume at 21.50 lakh tonnes (20.66 lakh tonnes) during the quarter. Increase in sales in the East, including Odisha and West Bengal, had contributed to sustaining volumes, Dharmakrishnan said.

Interest costs were down due to repayment of borrowings in the earlier period.

Also, strong credit ratings for short-term (A1+) and long-term borrowings (AA+) helped Ramco Cements source funds cheaper, he said.

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