Raw material prices, cost controls prop up Ambuja Cements, ACC's March qtr

Expansions, strong balance sheet and attractive valuations are supportive at a time when demand outlook is uncertain

Ambuja Cements, like its subsidiary ACC, posted a strong operating performance for the March quarter (Q1) on Monday after market hours, even as the cement makers’ sales volume came under pressure.

Ambuja’s sales volumes, impacted by the Covid-19-led disruption, at 5.77 million tonnes (MT) declined 10 per cent year-on-year (YoY) in Q1 (both companies follow the January-December accounting year). Soft raw material prices and cost controls helped boost operating margins; realisations, too, were better.

Ambuja’s predominant exposure to the northern and central Indian markets, as well as Gujarat — which have seen stronger realisations compared to east India and south