India Cements has reported net loss of ₹50 crore for the January-March quarter of 2023-24; this is 79 per cent lower than the net loss of ₹243.77 crore the company reported for the same period of the previous year.
For the full year 2023-24, the cement manufacturer made a net loss of ₹215.76 crore, compared with ₹169.82 crore, previously.
Sales for the quarter fell to ₹1,266.65 crore (₹1,485.73 crore). Similarly, sales for the full year was at ₹5,112.24 crore (₹5,608.14 crore).
The reduction in net loss in the fourth quarter comes on the back of profits on sale of non-core assets — ₹34.58 crore from the sale of a parcel of land and ₹26.21 crore from the sale of a ship.
In April 2024, India Cements sold its cement grinding unit in Maharashtra to UltraTech Cement for ₹315 crore. The company has said that the profit arising out of this transaction will be recognised as income in the April-June 2024 quarter.
Capacity utilisation
The company said in a press release that after muted capacity utilisation in the previous two quarters “caused by stressed working capital conditions”, it improved in the fourth quarter. “While there was further improvement in the operating performance with reduction in variable cost due to improved blending and higher capacity utilisation, the selling price took a hit; net price realisation declined 7 per cent (₹273 per tonne) in the fourth quarter, compared with the previous quarter,” the release said.
It added that since construction activity is expected to be brisk in the coming months, driven by continued infrastructure spending by the government, the demand outlook would be “healthy”.
However, increasing cost pressure, the high cost of logistics and severe competition in the market is also hanging over the head, which will affect the margins.