Companies

India Cements says the management is stable to focus on cement biz

Our Burea Chennai | Updated on June 24, 2020 Published on June 24, 2020

N Srinivasan, Vice-Chairman and MD, India Cements R_Ragu

Co sees improvements in demand post-lockdown

India Cements Ltd on Wednesday asserted that the management in the company was stable and it would continue its focus on cement business.

N Srinivasan, Vice Chairman & Managing Director of the Company responded to the ‘speculative reports’ that stated billionaire Radhakishan Damani was considering taking control of Chennai-headquartered company, which has been in the cement business for about seven decades.

“We have already clarified to SEBI. There is nothing to say. Stability of management will be ok. He (Damani) is a respectable person who has chosen to invest in India Cements. I should not say more. This company has been around for more than 70 years. We will continue to make cement,” said Srinivasan while announcing company results for March 2020 quarter and FY20.

Elaborating on the company’s performance, he said India Cements was in the verge of reporting better numbers for FY20 after a slow start in Q1. But COVID19 and associated lockdown applied brakes on the company’s recoveries in volumes and sales in the March quarter.

“We lost about ₹85 crore worth of cement volumes in March month itself,” he said.

However, post-COVID19 lockdown, improvements were seen on demand-side from May and June was also turning better. “Actually, demand is much better than our earlier expectation, and with monsoon not having failed, rural demand is also good. I feel the demand scenario will get better once the lockdown is lifted in more places,” said Srinivasan.

While the drop in volume alone had accounted for a contribution loss of about ₹150 crore, better cost measures helped mitigate the impact, and the net effect was only to the tune of about ₹60 crore.

Apart from the better-than-expected demand scenario, the northward movement of prices also gives some hope for the company. In FY20, net plant realisation increased by ₹38 to ₹3425 per tonne.

The company reported a net loss of ₹111 crore for the quarter ended March 31, 2020 as against a net profit ₹44 crore in the year-ago quarter, on account of COVID19 impact on March cement sales.

The company’s exceptional items for the year and quarter March 31, 2020 included impairment provision of ₹100.04 crore relating to receivables from certain subsidiaries.

Revenue dropped to ₹1152 crore when compared with ₹1564 crore in Q4 of 2018-19.

For the year ended March 31, 2020, the company’s net loss was ₹36 crore as against a net profit of ₹69 crore in the previous fiscal.

Revenue from operations stood at ₹5058 crore as against ₹5628 crore.

The Board has recommended a dividend of ₹0.60 per share for the year ended March 31, 2020.

Published on June 24, 2020

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
India Inc can do e-Board meetings for 3 more months