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Ambuja Cements: Rising volumes fail to mitigate cost pressures, stock falls

Better utilisation and good demand enabled Ambuja's cement volumes grow 9% year-on-year (YoY) to 5.46 million tonnes (MT) in the quarter, ahead of estimates

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Ujjval Jauhari
The strong volume growth clocked by Ambuja Cements during the September quarter (Q2) failed to offset the pressure on account of higher costs. The rupee depreciation, high crude oil prices, and firm coal and pet coke prices, all impacted profitability
even as Ambuja saw its capacity utilisation improve to 74 per cent as compared to 68 per cent last fiscal year.

Better utilisation and good demand — led by healthy growth in the infrastructure and housing sectors — enabled Ambuja’s cement volumes grow 9 per cent year-on-year (YoY) to 5.46 million tonnes (MT) in the quarter, ahead of estimates.

Motilal Oswal Securities,