Ramco Cements Ltd. has raised ₹376 crore over the past two months from the sale of non-core assets and is set to raise an additional ₹74 crore through further asset monetization.

Of the ₹376 crore raised, ₹50 crore was mobilized in September and ₹326 crore in October. The company is also in the process of finalizing the sale of land worth ₹74 crore, expected to be realized in Q3FY25.

“Ramco Cements is making good progress on the sale of other land assets and remains on track to achieve its target of ₹1,000 crore in non-core asset sales, the company said in a statement.

As of September 30, 2024, its net debt stood at ₹5,103 crore with an annualized net debt to EBIDTA of 3.95 times. The cost of debt for Q2FY25 was 7.96 per cent as against 7.80 per cent in Q2FY24.

The company repaid ₹326 crore of its debt in October using proceeds from the disposal of non-core assets.

Significant Decline

In terms of financial performance, Ramco Cements reported a significant decline in net profit, which dropped 74 per cent year-on-year to ₹26 crore for Q2FY25, compared to ₹101 crore in Q2FY24. This decline was largely driven by a double-digit fall in revenue.

Net revenue for Q2FY25 was ₹2,050 crore, down 13 per cent from ₹2,343 crore in Q2FY24. The decrease was mainly due to a 10 per cent drop in cement prices and a 3 per cent fall in sales volume.

Total sales volume, including building products, for Q2FY25, stood at 4.49 million tons, compared to 4.61 million tons in Q2FY24, reflecting a 3 per cent decline due to weaker demand during the monsoon season.

“Despite these challenges, the company continues to maintain strong EBITDA margins compared to industry peers,” it added.

EBITDA for Q2FY25 was ₹323 crore, down 22 per cent from ₹412 crore in Q2FY24. Blended EBITDA per ton decreased to ₹721 in Q2FY25 from ₹894 in Q2FY24. The operating ratio for Q2FY25 stood at 16 per cent , compared to 18 per cent in Q2FY24. The company remains focused on its strategy of offering the right products for the right applications to strengthen its brands.

Cement capacity utilization declined from 82 per cent in Q2FY24 to 75 per cent in Q2FY25, primarily due to additional capacities added through debottlenecking and the commissioning of Line 2 in Orissa in H2FY24. The total cement capacity increased from 23 MTPA to 24 MTPA in Q2FY25. The company is on track to achieve 30 MTPA cement capacity by March 2026, driven by the commissioning of the second line in Kolimigundla, further debottlenecking of existing facilities, and minimal capex investments in grinding capacity expansion.

During Q2FY25, the company incurred ₹263 crore in capital expenditure, including maintenance capex. The total capex for FY25 is expected to remain at ₹1,200 crore, which includes maintenance capex.

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