UltraTech Cement, an Aditya Birla group company, reported a seven per cent decline in net profit in the June quarter at ₹1,584 crore against ₹1,703 crore logged in the same period last year, largely due to lower realisation and higher cost.

Revenue from operation increased 28 per cent to ₹15,164 crore (₹11,830 crore). Sales volume jumped 16 per cent to 25 million tonne.

Overall expenses were up at ₹12,980 crore (₹9,508 crore) with power and freight cost increasing to ₹4,013 crore (₹2,427 crore) and ₹3,291 crore (₹2,648 crore), respectively. Earnings before interest, depreciation and tax was down 9 per cent at ₹3,204 crore (₹3,512 crore). Blended pet coke prices increased 82 per cent to $184 a tonne pushing up overall energy cost.

Cement demand was impacted by overall inflationary trends and lower labour availability in May. However, cement demand picked up in June on pre-monsoon construction activity, said the company.

UltraTech achieved capacity utilisation of 83 per cent against 73 per cent registered same period last year.

The company commissioned 18 MW of Waste Heat Recovery System in the quarter and enhanced total WHRS capacity to 185 MW covering nearly 16 per cent of its current power needs. This is expected to increase to 250 MW by the end of FY23, it said.

The company will commission 1.3 mtpa of cement capacity in the September quarter and another 9.6 mtpa and 5.8 mpta in consecutive two quarters. This will take the overall capacity to 131 mtpa by end of this fiscal.

In the second phase, it will add 22.6 mpta with an investment of 12,886 crore. It plans to have an overall capacity to 159.25 mtpa, reinforcing its position as the third largest cement company in the world, outside of China.

The company expects cement demand to see an upswing in demand in this fiscal aided the strong momentum in housing and governments thrust on infrastructure and industrial development. However, it said headwinds arising out of rising cost pressure will put some pressure on the profitability.

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