Ambuja Cements Q1 net up 56%

After remaining strong in early trade, shares trade weak post results

Ambuja Cements, part of the Swiss cement giant Holcim, has beaten the analysts' expectations with a whopping rise of 56% in its net profit at Rs 488 crore for the quarter ended March, 2013.

Most of the profit estimates were in the range of Rs 380 to Rs 425 crore - far below then what the cement maker reported on Friday.

However, the rise in profit after tax (PAT) was due to exceptional item representing additional depreciation charge of Rs 279 crore in the corresponding previous quarter and write back of income tax provision of Rs 117 crore in the current quarter, the company said in a statement.

The company's net sales disappointed with a decline of 3.3% at Rs 2,545 crore against Rs 2,631 crore in the previous corresponding quarter. This was mainly on account of poor sales of the building material, which is in line with the industry.

Ambuja reported a drop of 4.1% in its sales volume at 5.6 million tonnes during the quarter under review compared with 6.05 million tonnes in the year-ago period.

Shares of the company, which had been trading strong in the early trade, lost its gains. On the BSE, Ambuja stocks were trading at Rs 188.05, down 1.05% at 2:47 pm after touching an intra-day high of Rs 194.95.

In its outlook, the company said that cement industry is facing subdued demand on account of continuing economic slowdown. In an environment of over capacity, realisation are under pressure, it added.