Ambuja improves on operational costs but margins disappoint

May find it tough to grow volumes, given capacity limits; benefit from commissioning of clinker unit only in 2021

Ambuja Cements’ performance for the March quarter was below expectations owing to lower-than-expected volumes and realisation. 

Sales volume, at 6.37 million tonnes (mt), grew just 2.4 per cent year-on-year (YoY) despite st­rong demand during the qu­arter (Q1; accounting year is January-December). Ana­lysts at Motilal Oswal Securities had anticipated volumes to be 6.53 mt. 

Earlier, UltraTech and ACC (Ambuja’s subsidiary), the pan-India cement players, had reported much better volume growth of 16 per cent and 5.6 per cent, respectively, for the March quarter.

Moreover, Ambuja being a re­gional player — with presence in West and Nor­t­h India, was also expected to report good realisation