UltraTech net down 36% on lower realisation

UltraTech Cement, an Aditya Birla flagship company, reported 36 per cent fall in September quarter net profit at ₹825 crore against ₹1,280 crore due to weak demand and lower realisation.

Income was dipped two per cent to ₹15,855 crore (₹16,179 crore). Sales volume was up 4 per cent at 28 million tonne.

EBITDA during the quarter was down 18 per cent at ₹2,239 crore (₹2,718 crore). Sales realisation plunged 8 per cent to ₹4,901 (₹5,349) a tonne.

Despite logistics, fuel and power costs declining, the company’s profit was down due to weak demand. Raw material cost increased marginally by 1 per cent. UltraTech achieved capacity utilisation of 68 per cent during the quarter.

• Also read: UltraTech Cement expands capacity by 1.2 mtpa at Arakkonam unit

UltraTech has successfully raised $500 million through a sustainability-linked loan with participation from six banks. The transaction marks the second sustainability-linked financing, after the inaugural sustainability-linked bond issuance in 2021, said the company.

This financing signifies the ongoing commitment to align the company’s funding strategy with its sustainability and ESG goals, it added.

In line with its stated commitment towards enhancing environment conservation measures, UltraTech commenced 8 MW of Waste Heat Recovery System capacity during the quarter.

With this, its WHRS capacity stands augmented to 308 MW. The share of green power (including WHRS and RE power) in the company’s power mix will be 32 per cent for the quarter.

With the completion of the ongoing expansion projects across India by FY27 and receipt of statutory approvals for the acquisitions of Kesoram Cement (10.75 MTPA) and the India Cements (14.45 MTPA), UltraTech’s total cement capacity will surpass 200 MTPA.

The expanded manufacturing footprint will help reduce operational costs and improve customer service, leveraging the company’s strong nation-wide presence and its distribution network, it said.

UltraTech’s capacity expansion capitalises on the substantial long term growth potential of India’s cement sector, it said.

By increasing scale, the company will meet the rising demand for cement nationwide. Increase in Government spending on infrastructure sector and rising demand from the urban housing sector is expected to generate a sustainable volume growth of 7-8 per cent in future year, said UltraTech.

• Also read: Analysts remain neutral on cement sector amid lacklustre demand