UltraTech Q2 net profit flat at Rs 1,310 cr, revenue rises 16%

Aditya Birla group firm UltraTech Cement Ltd on Monday reported a consolidated net profit of Rs 1,310.34 crore for the quarter ended in September 2021 against Rs 1,310.06 crore in the year-ago quarter on account of sharp rise in coal and pet coke prices.

However, its revenue from operations was up 15.69 per cent to Rs 12,016.78 crore during the quarter under review as against Rs 10,387.14 crore in the corresponding period of the last fiscal, UltraTech Cement said in a BSE filing.

UltraTech Cement's total expenses were at Rs 10,209.43 crore, up 17.02 per cent in the second quarter of 2021-22 as against Rs 8,724.43 crore in the year-ago period.

"Coal and Pet coke prices nearly doubled in Q2FY22 resulting in energy cost rising 17 per cent YoY. The resulting impact on the company's operations were partly offset by reduction in power consumption and continuing focus on operational efficiencies," said UltraTech Cement.

The company expects to commence mining operations at its Bicharpur coal block situated in Madhya Pradesh, during Q3/FY22 which will help in reducing the dependence on coal purchases, it added.

During the quarter, UltraTech's consolidated sales volume was at 21.64 million metric tons, registering a year-on-year growth of 8 per cent.

While sharing updates over Covid-19, UltraTech said, "The unexpectedly virulent second wave of COVID-19, looks to be receding almost as quickly as it was rising."

"Nevertheless, UltraTech continues to closely monitor the situation and the impact on its operations, while according utmost primacy to the safety and well-being of its employees and business partners, it said.

Moreover, during the quarter, UltraTech commissioned cement capacity of 1.2 MTPA in October 2021 at - Patliputra Cement Works, Bihar and Dankuni Cement Works, West Bengal.

"This additional capacity will help UltraTech to service the fast-growing cement demand in the country," the company said while updating over the capital expenditure.

Over the outlook, UltraTech said factors such as -recovery in rural housing, higher MSP (minimum support price) for kharif crop, improved food grain production in rabi harvest, a third consecutive normal monsoon and pick-up in infrastructure-led construction activity are likely to drive cement demand off-take.

However, it also warned a continuous increases in input costs like coal, pet coke and diesel pose a challenge for the industry.

UltraTech is confident of weathering the storm of increase in prices of coal, diesel and other inputs, with its sustainable efficiency improvement programs, accompanied by increase in selling prices to absorb the increase in costs, it said.

Shares of UltraTech Cement Ltd on Monday closed marginally down at Rs 7,397.70 on BSE.