UltraTech Cement’s Profit Growth Beats Estimates For Sixth Straight Quarter
UltraTech Cement Ltd., India's largest cement maker, posted in line with estimates profit for the January-March quarter of the financial year 2016-17, sending shares surging to their highest in nearly two years.
Net profit fell 11.84 percent year on year to Rs 688.30 crore from Rs 780.78 crore in the same quarter last year, the company said in a stock exchange filing on Monday. The consensus of analysts tracked by Bloomberg stood at Rs 665 crore. Net sales at the Mumbai-based firm rose 3 percent to Rs 6,595.3 crore on a year-on-year basis, in line with the Bloomberg consensus estimate.
Total domestic volume growth (grey, white cement and putty) rose marginally to 13.73 million tonnes (MT). For the year, total domestic volume growth increase a percent to 47.62 MT. Realisation also grew 2.8 percent year on year to Rs 4800.1/ MT.
A higher base led to flat volume growth for UltraTech Cement. Twenty-one percent sequential growth is a healthy number. However, further demand would be key. Pick-up in government spending, good monsoon should lead to better days for these companies.Rajesh Ravi, Vice President-Institutional Research, Centrum Capital
EBITDA per tonne declined 8.1 percent year-on-year to Rs 931. EBITDA margin contracted 213 basis points to 19.4 percent over the same period. Higher power and fuel costs along with other expenses ate into the operating performance of the cement major. Power and fuel expenses and other expenses grew 13.56 percent and 10.43 percent on a year-on-year basis, respectively.
UltraTech commissioned grinding units at Nagpur, Maharashtra and Bihar during the quarter and is setting up a 3.5 metric tonnes per annum integrated cement plant at Dhar in Madhya Pradesh.
The Aditya Birla Group company also declared a dividend of Rs 10 per share.
Last week, rival ACC too posted a better-than-expected quarterly profit on account of higher sales.
Shares of UltraTech jumped as much as 5.8 percent, most since March 2015 to Rs 4,209 on the BSE. The stock had risen nearly 26 percent so far this year as of Friday’s close.6372.9137