ACC's strong operating performance in Q2 could lift sentiment

Improving operating profit despite rising costs should push up Street's confidence

ACC’s performance for the second quarter ended June 2017 (Q2) was above expectations on the profitability front. ACC follows January-December financial year. Cement sales volume at 6.74 million tonnes (MT) grew 10.1 per cent year-on-year and was better than 6.6 MT in the previous quarter. This was partly anticipated by analysts, in light of the completion of ACC’s capacity expansion at Jamul in Chhattisgarh. However, the Street’s concerns on rising costs in the backdrop of higher coal and pet coke price, seem to be getting addressed. 

In the June quarter, ACC’s power and fuel costs surged 31 per cent, while freight