The Ramco Cements has reported a net profit of Rs 156 crore during the quarter ended June 30, 2017, as against Rs 155.93 crore, a year ago. Revenue rose to Rs 1,194.01 crore from Rs 1,123.97 crore.
Sale of cement increased by four per cent during the quarter despite slowdown in demand in Tamil Nadu, due to drought and shortage of river sand. The state is a stronghold of the company,
However, company's efforts in other markets, especially in East, helped.
Sales in the domestic market grew to 2.12 million tonnes during the quarter from 2.04 million tonnes, a year ago.
Meanwhile, the company is planning to increase the satellite grinding unit’s capacity to 7.1 MTPA from 4 MTPA. The company plans to invest around Rs 1,095 crore in these projects.
The company's CEO A V Dharmakrishnan said, the company is embarking upon increasing its capacity through satellite grinding plants and this will enable the firm to further increase its presence in Andhra Pradesh, Odisha and West Bengal, he added.
The expansion will be taken up at Vizag, Kolaghat and with new grinding units in Odisha.
These projects would be commissioned in a period of 18 months.
These projects would be commissioned in a period of 18 months.
The advantage of lower cost pet coke inventory built up earlier has exhausted and the effect of subsequent purchases of pet coke at increased market prices has been reflected in the operating cost during the quarter, said the company.
Ramco Cements continues to strive for achieving better-operating efficiencies through various cost reduction initiatives in the areas of power and fuel and logistics which have helped the company to stay competitive, said the cement major.
On the outlook, Dharmakrishnan said the effects of demonetisation are now behind. The effects of GST, increased spending by the Centre on infrastructure and affordable housing scheme are expected to propel growth in cement demand in the future, the company said.