The firm trend in cement prices, which had started moving up in the last few months, will continue in the coming months, asserted N. Srinivasan, vice-chairman and managing director of The India Cements Ltd. (ICL).
Addressing a press conference here on Saturday, he said that there was good demand for cement till the time elections were announced.
During the polling phase, there was a certain dullness in demand, though. “Going forward, however, we expect good demand for cement to continue in the coming quarters,” he added.
During the fourth quarter ended March 2019, the EBIDTA (earnings before interest, depreciation, tax and amortisation) per tonne for ICL increased to ₹629 from ₹470 a tonne in the third quarter. “We expect it to be better in the first quarter of the current year,” he added.
Not surprisingly, the capacity utilisation of ICL improved to 84% from 79% in the same quarter of the previous year. For all of 2018-19, capacity utilisation improved to 79% from 71% in the previous year.
ICL put up an improved show during the fourth quarter primarily due to improved selling prices and increased volume sales. The increase in NPR (net plant realisation) together with the improved volume, resulted in higher EBIDTA of ₹210 crore for the quarter under review, up from ₹162 crore in the same quarter of the previous year.
Net profit rises
Net profit during the quarter improved to ₹43.85 crore (₹35.27 crore). Total revenue for the quarter stood at ₹1,581.38 crore (₹1401.73 crore). The net profit for 2018-19 worked out to ₹69.44 crore (₹100.62 crore).
Total income for 2018-19 increased to ₹5,658.96 crore (₹5,360.13 crore).
The board has approved a dividend of 8% on equity capital.
Mr. Srinivasan said he expected the new government at the Centre to continue the thrust on infrastructure and housing.
On the change of guard in Andhra Pradesh with the YSR Congress winning the Assembly elections, Mr. Srinivasan said: “Jagan Reddy is a pro-development person. I expect the cement demand in the State to be better in the coming years. Like the government of his late father, Y.S.R. Reddy, Mr. Jagan Reddy is also expected to implement special housing schemes. Similarly, I expect a good demand in Telangana with the government implementing big-ticket irrigation projects.”
On the cost front, the company said it had taken proactive steps in containing the freight and handling expenses in the face of a substantial increase in the price of diesel.
