India Cements net rises 3% to ₹35.3 cr.

‘Sales increase by 8% to 30.9 lakh tonnes, recovery in demand from States working on infra projects’

The India Cements Ltd. (ICL) reported a standalone net profit of ₹35.3 crore for the quarter ended March 2018 from ₹34.3 crore in the same quarter the previous year.

The cement firm, however, reported a lower total income of ₹1,401.73 crore for the quarter under review, from ₹1,524.29 crore in the same quarter the previous year. For 2017-18, the EBIDTA stood at ₹722 crore against ₹869 crore in 2016-17, the company said in a release. The net profit for the year was ₹100.6 crore as against ₹173.4 crore in the previous year. The total income for year was ₹5,360.1 crore (₹5,794 crore).

A combination of increased fuel cost and drop in price realisation per tonne cement sold were primarily responsible for decline in profit last year.

The board of directors, in their meeting held on Friday, approved a dividend of 8% for the year 2017-18.

Addressing a press conference here, N. Srinivasan, vice-chairman and managing director, said, “We have done well last year given the circumstances.”

The second-half of the year that went by saw better demand. During the fourth quarter, sales volume increased by 8% to 30.9 lakh tonnes. Capacity utilisation improved to 79% in the fourth quarter from 73% in the same quarter the previous year. This was mainly due to recovery in demand from States such as Andhra Pradesh, Telangana, Karnataka and Maharashtra which were implementing infrastructure projects, he said.

In Tamil Nadu, the main market, demand did not pick up due to restrictions on sand mining. Also, there were no infra projects. The overall sales volume marginally improved to 11.17 million tonnes last year from 11.04 million tonnes in the previous year, he said. The capacity utilisation of the plants stood at 71% last year.

‘Improved sales’

Stating that he was optimistic on improved sales and better capacity utilisation, Mr. Srinivasan said, “We are watching the situation.” He indicated that the company would review the situation in the second quarter before contemplating any expansion. One had to see if the higher level of capacity utilisation was sustainable.

For the last seven years, the cement industry had been struggling to achieve growth. After a gap of five years, the industry had clocked a growth of 6.3% against a 1.2% contraction in the preceding year, he said.