Ultratech Cement Q2 profit jumps 69%; revenue up by 15%

Cement major Ultratech Cement released the financial results for the July to September quarter on Thursday. During the quarter under review, the Aditya Birla Group-led company reported a 68.7% year-on-year (YoY) increase in its profit to ₹1,280.38 crore. The company reported ₹758.70 crore in profit in the same period last year.

"Cement demand maintained its positive momentum. during Q2FY24 also. The company witnessed demand from all sectors, fuelled by government-led infrastructure, rural development and urban residential demand," says the company.

In the September quarter, the company’s revenue from operations stood at ₹16,012.13 crore, up 15% YoY as against ₹13,892.69 crore in the corresponding period of the previous year. The company’s EBITDA (earnings before interest, tax, depreciation and amortisation) margin improved by 200 basis points (bps) YoY to ₹2,718 crore, as against ₹2,013 crore in the same period last year.

Sequentially, however, the company's profit and revenue from operations declined by 24.1% and 9.72%, respectively. In the June quarter, the company’s profit stood at ₹1,690.22 crore, whereas the revenue from operations was ₹17,737.10 crore.

Meanwhile, the company's sales volume grew 15% year-on-year to 25.08 million tons unit. The company’s total income in the September quarter stood at ₹16,179.26 crore, witnessing a growth of 15.2% YoY as against ₹16,179.26 crore in the corresponding period of the previous year.

According to the company, during the quarter under review, Ultratech achieved 75% capacity utilisation on expanded capacity. The energy cost was lower by 10% YoY in the September quarter, whereas raw material cost surged 4% YoY on account of an increase in the cost of flyash and slag. During the quarter under review, the company commissioned a cement capacity of 2.5 MTPA, taking the total grey cement capacity to 132.45 MTPA (million tons per annum) in the domestic market.

The company says that Ultratech is aiming to achieve 22.6 MTPA by FY25/FY26. "Work on the second phase of growth of 22.6 MTPA is in full swing. As part of this project, we are adding another 1.8 MTPA of slag grinding capacity taking a total of phase 2 to 24.4 MTPA. Commercial production from all these new capacities is expected to go on stream in a phased manner by FY25/FY26,” the company says.

The company expects the festive season and the January-March peak construction period to give a boost to demand. "Demand will also be led by pre-election spending, continued government push on infrastructure development, and sustained real estate development. All of this augurs well for the Company," says the company.

Following the development, the share price of the cement major closed 2.83% higher at ₹8,514.80 crore.