Sale volumes have grown both in southern and eastern markets, but the realisation has not improved due to pressure on prices and increase in transportation cost due to diesel price increase.
Ramco Cements has reported a marked drop in its net profit for the quarter ended December 31, 2018 to Rs 101.07 crore as compared to Rs 114.47 crore in the same quarter last fiscal. The revenue during the quarter was reported higher at Rs 1,216.99 crore as against Rs 1,189.45 crore in the corresponding quarter of last fiscal.
The sale volume of cement has increased by 19% during the nine months’ period that ended 31st December 2018, compared to the corresponding period of the previous year. Sale volumes have grown both in southern and eastern markets, but the realisation has not improved due to pressure on prices and increase in transportation cost due to diesel price increase.
Despite that, there has been an increase in the production during the quarter to 27.47 lakh tonne as against 24.69 lakh tonne in the same quarter last fiscal. The net plant realisation, however, has come down due to price hike in diesel, higher power/fuel costs as well increase in petcoke costs and hence lower net profit, the company said in a release here on Tuesday. In a statement, the company said that an average diesel price has risen by 22% during the nine months that ended December 2018, which had resulted in the increase in transportation cost of both raw materials and finished goods.
During the nine months, the power and fuel cost continue to remain at higher levels compared to the previous corresponding period due to higher cost of pet coke and coal. However, during the current quarter, the prices of pet coke and coal have softened and the effect of the same will reflect in operating cost in coming quarters. The windmills have generated 2,207 lakh units for the nine months as against 2,425 lakh units of the corresponding period of previous year. The income from wind power for the nine months was `58.94 crores as against `65.78 crores of the corresponding period of the previous year.
As far as the Competition Commission of India’s (CCI) penalty of `258.63 crore towards alleged cartelisation is concerned, the company has deposited `25.86 crore (10% of the penalty). Backed by legal opinion, the company believes that it has a good case and hence no provision is made. During the nine months’ period of current fiscal, the company has incurred `767 crore towards capital expenditure for the ongoing capacity expansion at various locations, the press release added.