The Ramco Cements Q2 net profit jumps to Rs 519.12 crore

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October 25, 2021 4:39 PM

Total revenue rose 18.6 per cent to Rs 1,510.33 crore in the second quarter of the current fiscal. In the year-ago period, the same was at Rs 1,273.47 crore.

Ramco CementsThe company had posted a net profit of Rs 238.92 crore during the July-September period of the previous fiscal, according to a regulatory filing. (Representative image)

The Ramco Cements Ltd on Monday reported an over two-fold jump in consolidated net profit at Rs 519.12 crore for the quarter ended September, helped by write-back of excess deferred tax and growth in sales.

The company had posted a net profit of Rs 238.92 crore during the July-September period of the previous fiscal, according to a regulatory filing.

Total revenue rose 18.6 per cent to Rs 1,510.33 crore in the second quarter of the current fiscal. In the year-ago period, the same was at Rs 1,273.47 crore.

The Ramco Cements’ total expenses jumped 32.31 per cent to Rs 1,231.60 crore in the latest September quarter. It stood at Rs 930.85 crore in the same period a year ago.

“During Q2, the sale of cement is 2.71 million tons compared to 2.21 million tons in the corresponding period of the previous year with a growth of 23 per cent. The utilisation rate for Q2 is 74 per cent as against 70 per cent in Q2, based on clinker capacity,” the company said in a post-earning statement.

During the September quarter, cement demand was affected in eastern markets due to heavy monsoon. In the Southern market also, cement demand dampened in Kerala due to weekend lockdowns and heavy monsoon, the company said.

“The average increase in diesel prices by 20 per cent during the current quarter has resulted in an increase of in-bound/ out-bound logistics cost. The power and fuel cost per ton of cement for Q2 has increased to Rs 1,057 from Rs 823,” the company said, adding that continuous increase in fuel prices is likely to push up the cost further in the coming quarters.

As per Section 115BAA of the Income Tax Act, 1961, the company has an irrevocable option of shifting to a lower tax rate and simultaneously forgo certain tax incentives, deductions and accumulated MAT credit, it said.

“In view of the overall tax benefits available under the said option, the company has opted for shifting to lower tax rate from FY 2021-22 during the current quarter.

“Consequent to the adoption of the new tax regime, the company is entitled to write back the excess deferred tax provision of Rs 305.58 crore from Deferred Tax Liability to P&L. While there will be no impact on Profit before Tax, the Profit after Tax will be higher by Rs 305.58 crore for the current quarter,” it noted.

Providing an update about its Kurnool project in Andhra Pradesh, The Ramco Cement said the project is delayed mainly because of disruption of workforce caused by COVID since last 21 months.

Besides, it has proposed to modernise its RR Nagar plant in Tamil Nadu at a cost of Rs 476 core by installing a new energy-efficient kiln. It is expected to commission the new kiln before March 2023, it added.

Shares of the company declined nearly two per cent to close at Rs 944.95 on the BSE.

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