India Cements net profit down by 36%, MD Srinivasan calls Q3 worst quarter

India Cements on Friday reported standalone net profits at Rs 15.24 crore for the third quarter ending December 31, 2017 which was one of the 'most challenging quarters', a top company official said.

The city-based company had registered net profits at Rs 35.34 crore during corresponding quarter of previous year.

For the nine month period ending December 31, 2017 net profits of the company stood at Rs 65.35 crore as against Rs 141.73 crore registered during year ago period.

The financial statement for third quarter and for nine month ending December 31, 2017 include those of the merged entities of Trinetra Cement Ltd and Trishul Concrete Products Ltd with India Cements Ltd.

The figures for the corresponding quarter of the previous financial year and nine month ending December 31, 2017 do not consider of merged entities and are not comparable.

Commenting on financial performance, company Vice Chairman and Managing Director, N Srinivasan told reporters that "third quarter (ending December 31, 2017) was most challenging quarter".

It was due to "high fuel costs", uncertainty on pet coke usage and poor sales in Tamil Nadu which is a main market for the cement maker.

To a query, he said, Andhra Pradesh market was much better in terms of demand for cement.

Srinivasan said Maharashtra witnessed good demand for cement due to road development programme announced by the government there. "The demand is extremely good (in Maharashtra)", he said.

On net plant realisation, he said, it was Rs 3,275 as against Rs 3,475 in sequential quarter of last year.

The drop in NPR on account of limited cement consumption in South was "single contributory factor" for the sub optimal performance during the quarter under review, a company official said.

On the outlook, Srinivasan said economic activity was expected to re-bound with the pick-up in global growth and trade.

While there are expectations cement industry getting over the weak off-take in coming quarters, it continues to face cost pressure from rising input costs, he said.

The overall sales volume including exports was 27.26 lakh tonne, he said.

Cement industry saw a growth of only six per cent during the third quarter ending December 31, 2017, he said. He said cement industry was expected to clock double digit growth in 2019-20.