UltraTech Cement Q2 net up 62.6 pc to Rs 578.55 cr

UltraTech Cement Ltd on Monday reported a 62.59 per cent increase in consolidated net profit at Rs 578.55 crore in the second quarter ended September 2019.

The company had recorded a net profit of Rs 355.82 crore in the July-September quarter a year ago, the Aditya Birla Group firm said in a BSE filing.

Its revenue from operations rose 4.01 per cent to Rs 9,620.47 crore during the quarter under review as against Rs 9,249.26 crore in the corresponding quarter of previous fiscal.

UltraTech Cement's total expenses rose marginally to Rs 8,877.92 crore as against Rs 8,868.43 crore in the year ago period.

The consolidated results also include the cement business of Century Textiles, whose acquisition process was completed by UltraTech Cement on October 1, 2019.

On a standalone basis, Century Textiles had net sales of Rs 746 crore in July-September quarter.

"UltraTech completed the acquisition of Century Textile's cement business, with the Scheme of Demerger becoming effective from 1st October, 2019. With this acquisition, UltraTech's cement manufacturing capacity stands augmented to 117.4 mtpa, including its overseas capacity," the company said.

"This makes UltraTech the 3rd largest cement company in the world, outside of China. It is also the only company in the world to have a capacity of over 100 million tons in a single country, outside of China," it added.

However, UltraTech Cement's domestic sales fell 1.20 per cent to 17.19 million tons in July-September as against 17.40 million tons in the corresponding quarter last year.

"Monsoon quarter results in lower volumes," the company said in its investor presentation.

During the first half (April-September) of this fiscal, Ultratech Cement's net profit almost doubled to Rs 1,859.82 crore from Rs 940.84 crore in the corresponding period of previous fiscal.

Revenue from operations rose 11.87 per cent to Rs 21,025.41 crore in the first half as against Rs 18,794.11 crore in the corresponding period of 2018-19.

In a separate filing, UltraTech Cement said its board, in a meeting held on Monday, approved a capex of Rs 940 crore for making premium products with an increase in its grinding capacities in Bihar and West Bengal by 0.6 mtpa (million tons per annum) each and a new grinding unit of 2.2 million tons in Odisha.

"This will further strengthen the company's position in the eastern markets. All the plants will be commissioned by January-March 2021," the company said.

On the outlook, it said there is a good possibility of a normalised demand for cement going forward, helped by government's thrust on infrastructure and good monsoon, which should again help revive rural demand.

"The company, with its presence across all the zones in the country, is best positioned to take advantage of revival in cement demand, despite the anomalies that may get created in demand patterns in some parts of the country due to extraneous reasons," it added.