Cost pressures weigh on UltraTech Cement in Q1; net profit down 33%

Despite strong volume growth, cost increases outweighed realisation improvement, hurting profits

As expected, the impact of cost was evident on UltraTech’s performance in the India business for the quarter ended June (Q1).

While volumes grew on almost expected lines by 34 per cent year-on-year to 16.8 million tonnes (mt), leading to 30 per cent growth in revenue, operating performance was a bit disappointing. Realisations improved but not  enough to match the pressure from rising energy and logistics cost. A 55 per cent dip in other income to Rs 731 million meant net profit fell 33 per cent over a year, to nearly Rs 6 billion.

However, the future, especially the second half of