Shree Cement Q2FY25 results: Net profit declines 83% to Rs 76.44 crore

Shree Cement reported an 83 per cent dip in consolidated net profit (attributable to the owners of the company) for the quarter ended September 2024, on the back of weak demand and lower revenue.

 

For the quarter under review, the net profit of the company was Rs 76.44 crore, down 83 per cent from a year ago. Revenue from operations in the same period fell 21 per cent to Rs 4,054.17 crore.

 

Revenue declined due to a seven per cent fall in sales volumes to 7.60 million tonnes (MT) from 8.2 MT a year ago.

 

In its press statement, the company said, “Despite the challenging demand conditions on account of the prolonged monsoon and softer prices faced by the industry, the company’s focus on maintaining brand equity, product premiumisation, and improving geo-mix helped maintain its realisation on a quarter-on-quarter (Q-o-Q) basis. This, coupled with cost optimisation and operational efficiency measures, drove Ebitda during the quarter.”

 

Neeraj Akhoury, managing director, Shree Cement, said, “The company expects gradual improvement in demand driven by increased government spending in the second half of the financial year and improved demand from urban and rural segments owing to a good monsoon. Shree Cement remains focused on its long-term growth and sustainability, with ongoing investments in capacity expansion and the adoption of greener technologies.”

 

Shree Cement maintained its capital expenditure (capex) target to expand capacity to 80 million tonnes per annum (MTPA), and said, “The company is continuously working to identify suitable opportunities to achieve its goal of exceeding 80 MTPA capacity by 2028.”

 

Of the ongoing expansion, the company expects Jaitaran, Rajasthan (6.0 MTPA), Kodla, Karnataka (3.00 MTPA), Baloda Bazar, Chhattisgarh (3.40 MTPA), and Etah, Uttar Pradesh (3.00 MTPA) to be commissioned in the first quarter of FY26.

 

In its outlook for the remainder of FY25, the company said, “An uptick in demand is expected on account of the release of budgetary allocations and on-ground execution of infrastructure projects. Further, higher rural demand is expected on the back of a good kharif crop and improved farm prices. Spending under additional houses in the Pradhan Mantri Awas Yojana (PMAY) scheme (rural and urban) and an increase in industrial and commercial capex is also expected to drive cement demand in the near future.”