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The Ramco Cements Ltd reported a profit after tax of ₹517 crore for the quarter ended September 30, compared with ₹236 crore in the year-ago period.
Its profit before tax fell 19 per cent to ₹274 crore, against ₹338 crore in the same period of the previous fiscal.
The company opted for shifting to a lower tax rate from the September quarter. As a result, it is entitled to write back the excess deferred tax provision of ₹306 crore from deferred tax liability to P&L. While there will be no impact on profit before tax, the profit after tax will be higher by ₹305.58 crore for the second quarter of this fiscal, according to a statement.
Its EBIDTA was ₹402 crore (₹450 crore), a decline of 11 per cent due to increase in operating cost. Blended EBIDTA per tonne was ₹1,484 (₹2,035). Operating ratio was at 27 per cent (36 per cent).
Ramco Cement’s revenue grew 19 per cent to ₹1,501 crore (₹1,265 crore), helped by a 23 per cent rise in cement sales at 2.71 million tonnes (2.21 million tonnes).
“Under a very challenging situation of rising costs and natural calamities in our major markets like Kerala and the Eastern region, we rose to the occasion and performed better than the industry. I am confident that with the normalcy restoring we will definitely march ahead of the industry,” AV Dharmakrishnan, Chief Executive Officer, Ramco Cements, told BusinessLine.
Rise in costs
The average increase in diesel prices by 20 per cent during the second quarter resulted in an increase of in-bound / out-bound logistics cost. The power & fuel cost per tonne of cement also increased to ₹1,057 from ₹823 in the year-ago period. The spot market price of pet coke increased to $250 CIF in September and the price of imported coal from Australian origin also increased to $220. The continuous increase in fuel prices is likely to push up the cost further in the coming quarters. However, the operations of 18 MW WHRS in Jayanthipuram have helped to offset the power & fuel cost for the company to a certain extent, the company said in the statement.
Its strategy of right cement for right applications yielded positive results and the company is seeing strong signs of demand recovery in the coming quarters.
The company said the balance 9 MW WHRS in Jayanthipuram is expected to be commissioned in this quarter. In view of steep cost increase, the need for price increase is imperative to sustain the business operations. The company is conducting various meetings to educate dealers, it said.