Net profit up 69% to Rs 1,281 cr, beats estimates

The country’s largest cement maker, UltraTech Cement, reported a 69 per cent rise in net profit for the quarter ended September 2023 (Q2FY24) on the back of volume growth and a higher cost base of a year ago. The company reported a 15 per cent increase in cement sold in India for the quarter under review.

UltraTech, in its press statement, said cement demand maintained its positive momentum during Q2FY24. “The company witnessed demand from all sectors, fuelled by government-led infrastructure, rural development and urban residential demand,” according to the statement.

For the Q2FY24 period, profit after tax (PAT) was at Rs 1,281 crore, up 69 per cent from a year ago. Net sales for the company were up 15.3 per cent year-on-year at Rs 16,012.1 crore. The company beat street expectations for both revenue and profitability. In a Bloomberg poll, 17 analysts estimated revenue of Rs 15,769 crore, and 18 analysts estimated Rs 1,334 crore.

Sequentially, the company reported a 24 per cent dip in PAT owing to a seasonally weak quarter.

UltraTech reported another quarter of steady growth in volumes of 15 per cent year-on-year at 25.66 million tonnes (MT). Volumes for the company’s export markets were also up 58 per cent.

Reported Ebitda for the quarter under review was at Rs 2,718 crore, up 35 per cent from a year ago. Ebitda is Earnings Before Interest, Taxation, Depreciation, and Amortisation.

UltraTech’s Ebitda per tonne remained below the Rs 1,000 per mark; however, it witnessed a rise to Rs 956 per tonne, higher from Rs 808 reported a year ago.

In its outlook for the next two quarters, UltraTech said demand revival is imminent, especially during the festive season and the January-March peak construction period. Demand will also be led by pre-election spending, continued government push on infrastructure development, and sustained real estate development.

On its ongoing capacity addition, the company said 5.5 mtpa capacity has been commissioned during this financial year and the total grey cement manufacturing capacity in India stands at 132.45 mtpa. The statement added that work on the second phase of growth of 22.6 mtpa is in full swing and commercial production from all these new capacities is expected to go on stream in a phased manner by FY25/FY26.