India Cements posts Q2 loss of Rs 113 cr on input cost spike, lower volumes

Revenue from operations up 7% YoY; firm had posted Rs 30 cr profit a year ago

Chennai-based India Cements has posted a consolidated net loss of Rs 113 crore for the second quarter of the financial year 2022-23, compared to a net profit of Rs 30 crore during the same period last financial year.

However, the company’s revenue from operations was up 7 per cent to Rs 1,327 crore during the quarter under review, from Rs 1,235 crore a year ago. “The performance during the quarter was significantly impacted due to spiralling increase in the price of input materials resulting in higher cost which could not be compensated in the market due to huge supply overhang. This was compounded by the loss of volume as some of the markets were not commercially viable due to high cost of production. All these factors adversely affected the profitability with the company recording the largest loss in a quarter,” the company said in a statement.

The overall volume of clinker and cement for the company was at 2.254 million tonnes for the quarter as compared to 2.36 million tonnes last year. The company said that with a lower capacity utilization of around 60 per cent along with uncompensated cost increase, impact on the bottom line was severe.

During the period under review, the company’s total expenses rose by 27 per cent to Rs 1,528 crore as against Rs 1,202 crore last year. “The cost per kcal of fuel went up from around Rs 1.60 per kcal in the same quarter of the previous year to as high as Rs 3.26 per kcal and the average rate of power moved up by more than Rs 2 per unit resulting in increase in cost of production by more than Rs 1,300 per tonne during the quarter,” it added.