India Cements (ICL) has reported a net profit after tax of Rs.21.47 crore for the third quarter ended December 31, 2010, down from Rs.34.80 crore in the same quarter in the previous year.

The third quarter positive net profit, however, comes on top of a loss of Rs.33.63 crore reported by the company for the quarter ended September 30, 2010.

N. Srinivasan, Vice-Chairman and Managing Director, attributed the “reasonable third quarter performance” to better selling prices.

Total income has dropped to Rs.783.50 crore during the quarter under review from Rs.875.97 crore in the year-ago period.

A combination of demand slump and cost push has put the company in a tight spot.

The price recovery since September, however, has somewhat eased the pressure.

With South witnessing a 2.2 per cent negative growth during the past three quarters, the company thought it fit to conserve cash and liquidate the inventory. As a consequence, the capacity use was around 60 per cent. Mr. Srinivasan said that “capacity overhang” was one of the problems facing the industry.

The negative demand had accentuated the problem, he pointed out.

While the current prices were stable, he said that continued stability in prices would depend largely on the demand growth and utilisation levels by the cement industry.