Notwithstanding a rise in net plant realisation per tonne, continued sluggishness in demand has pulled down sales volume and reduced drastically the net profit of The India Cements Ltd. (ICL).
The company reported a third quarter net profit after tax of Rs.42 lakh, down from Rs.26.12 crore for the third quarter ended December 2012. Sales volume dropped to 22.94 lakh tonnes from 24.15 lakh tonnes. The net plant realisation has increased to Rs.3,466 from Rs.3,090 a tonne in the previous quarter.
Addressing a press conference here on Monday, Vice-Chairman and Managing Director N. Srinivasan said the lower sales volume had nullified the rise in net plant realisation.
Interest charges were higher at Rs.80 crore (Rs.71 crore). Depreciation charges were lower at Rs.69 crore (Rs.71 crore). There was a marginal loss of Rs.2 crore against a profit of Rs.54 crore in the same quarter in the previous year. However, foreign exchange translation difference showed a gain of Rs.3 crore against a charge of Rs.11 crore, enabling the company to report a nominal profit of Rs.42 lakh for the quarter under review.
Fielding a range of questions, Mr. Srinivasan said that the third quarter saw just one per cent growth in the demand. “There is virtually no growth,” he pointed out. To a query, he said, “you have to wait for the recovery”. Insisting that the cement business required to be looked at from a longer-term perspective, Mr. Srinivasan said that no major decision should be taken based on near-term problems.