Ambuja Cements, Adani Group’s building materials arm, on Tuesday posted a 13.23% rise in consolidated net profit of Rs 488 crore for the quarter ended December, buoyant on higher production and capacity utilisation as demand picked up. The company had posted a net profit of Rs 431 crore a year ago.
The company posted a consolidated revenue of Rs 8,036 crore, a 4.23% rise from Rs 7,710 crore a year ago. Consolidated Ebitda fell to Rs 1,138 crore from Rs 1,213 crore a year ago and Ebitda margin fell to 14.6% from 16.2%.
An estimate of Bloomberg analysts was expecting a consolidated net profit of Rs 1,050 crore (1 broker), with revenues of Rs 9,402.90 crore (1 broker) and Ebitda of Rs 1,690.30 crore (1 broker).
The cement manufacturer followed a January-December fiscal, but in October its shareholders approved changing of the financial year end from December 31 to March 31. Accordingly, the current financial year has been extended by three months to end on March 31, 2023.
“During the quarter, the cement sector saw higher production and capacity utilisation on account of pick up in demand. The company has maintained a healthy topline and leadership position in its core markets with a stronger Ambuja and ACC product portfolio. Business initiatives are expected to further bring down operating cost, reduce clinker factor, reduce logistics cost, improve sales of blended cement and expand Ebitda margin,” Ambuja Cements CEO Ajay Kapur said.
“We expect cement demand to further grow in the coming quarters on the back of increased infrastructure activities given sharp focus on infrastructure capex in this Budget,” he added.
The company recorded a robust volume growth of 7% from the sequential September quarter, supported by an increase in blended cement (clinker factor reduced to 59.5% from 60.1%), better route planning and higher operational synergies with ACC, its subsidiary.
“The company remains debt free with a healthy position of cash and cash equivalents, which augurs well for its journey to achieve scale and market leadership. Our focus to ramp up capacity in efficient way to ensure to be one of the lowest cost producers is on track. Ametha integrated unit is set to be commissioned by July 2023, which will increase kiln capacity by 3.3 Mtpa,” Kapur added.
In September, Adani Group completed the earlier announced acquisition of Ambuja Cements and ACC via a special purpose vehicle, Endeavour Trade and Investment. The deal, announced on May 15, 2022, comprises Holcim’s entire 63.11% stake in Ambuja Cements, which owns a 50.05% interest in ACC, and its 4.48% direct stake in ACC.