UltraTech Cement Ltd on Monday reported a 7.92 increase in its consolidated net profit to Rs 1,710.14 crore in the third quarter ended December 2021 as trade sales were impacted and overall cement demand remained subdued during the period. The leading cement producer had posted a net profit of Rs 1,584.58 crore in the October-December quarter a year ago.
Revenue from operations rose by 5.89 per cent to Rs 12,984.93 crore during the quarter under review compared to Rs 12,262 crore in the corresponding period of the last fiscal, the company said in a BSE filing.
UltraTech Cement’s total expenses were at Rs 11,422.05 crore, up 12.09 per cent in Q3FY 2021-22 as against Rs 10,190.03 crore in the year-ago period.
“After gaining pace in October 2021, demand slowed down substantially in November 2021 as a result of the construction ban in the NCR, extended monsoons in the south and a few states in the north, sand issues in the eastern region as well as in parts of Uttar Pradesh, and the Diwali holiday season,” the Aditya Birla Group firm said in a post earning statement.
During the quarter, UltraTech’s consolidated sales were at 23.13 million metric tons, down by 3 per cent year-on-year.
“The company has yet been able to maintain a strong growth trajectory, recording a 13.2 per cent growth in its domestic cement sales volumes in the nine months ended December 2021, despite marginal degrowth in the reported quarter,” it said.
While, on the front of the inputs, UltraTech Cement Ltd said prices of coal and pet coke has started softening during this quarter, though the prevailing rates are still at elevated levels YoY. Though diesel prices are up 24 per cent YoY despite the recent reduction in duty/other levies by the central and various state governments.
Moreover, during the October-December quarter, UltraTech repaid loans amounting to Rs 3,459 crore.
“The repayments were funded through internal accruals and have reduced the company’s exposure to floating interest rate,” the company said.
During the quarter, UltraTech has commissioned 19 MW of WHRS (Waste heat recovery unit) and 53 MW of solar power.
“With this expansion, the Company’s green energy share has gone up to 16 per cent which includes 156MW of WHRS and 221MW of solar power,” it said.
Over the current spread of the Omicron variant of COVID-19, UltraTech Cement said its impact on the economy remains to be seen.
“With business continuity plans in place, UltraTech is better placed to tide over the current wave of the pandemic. As in the earlier waves, it continues to closely monitor the situation and impact on its operations. Safety and well-being of employees and business partners remain the topmost priority,” the company said.
Over the outlook, UltraTech said though in Q3, trade sales were “impacted” and “demand remained subdued”, it expects it to revive in the January-March quarter.
“With the onset of the peak season and rising construction activities, cement demand is expected to revive in Q4FY22, driven by a pick-up in the government-led infrastructure and housing projects. Rural and urban demand is also expected to pick up going forward. All of this augur well for the Company,” it said.
Shares of UltraTech Cement Ltd on Monday were trading at Rs 7,864 on BSE, up 2.73 per cent from the previous close.