UltraTech Q1 profit after tax surges 7% on back of higher volumes

UltraTech Cement on Friday reported a 7 percent year-on-year (YoY) growth in its profit after tax (PAT) for the first quarter of the 2023-24 financial year (Q1FY24) on the back of higher volumes. The company reported a 20 percent growth in volumes for the June quarter.

The company said that it has opted for the new tax regime from FY24, in terms of the provisions of Section 115BAA of Income-Tax Act, 1961. Provision for current and deferred tax expenses has been recognised accordingly.

In Q1FY24, UltraTech reported PAT of Rs 1688 crore at the consolidated level. Net sales for the same period were up 17 percent YoY, at Rs 17,519 crore. The company met street expectations. In a Bloomberg poll, 14 analysts estimated a revenue of Rs 17034 crore and 13 analysts said they expected a net profit of Rs 1617 crore.

Analysts with Prabhudas Lilladher said that the company’s earnings before interest, tax, depreciation and amortisation (Ebitda) per tonne declined 13 percent YoY despite strong 20 percent volume growth even if power and fuel costs disappointed.

UltraTech in its results press statement said that energy costs were higher by 3 percent YoY, primarily due to currency devaluation. “Additionally, there was a 6 percent rise in raw material cost, mainly driven by the higher costs of fly ash and slag,” the note added.

On its on-going capacity additions plans, the company said that it commissioned another 4.3 million tonnes per annum (MTPA) capacity so far in FY24. With this, the company’s total grey cement manufacturing capacity in India now stands at 131.25 MTPA.

In its outlook for the sector, UltraTech said that demand for cement across all sectors continues to remain strong. Higher infrastructure spending ahead of the general elections in 2024 is expected to further propel cement demand during the ongoing financial year.

In Friday's trade, UltraTech's shares closed at Rs 8126.50 per share, down 1.18 percent on the BSE. The results were announced after the close of trade.