UltraTech Q2 net dips 12% to Rs 164cr

UltraTech Cement, part of the Aditya Birla group, has posted a decline of 11.66 per cent in its net profit at Rs 164.19 crore for the quarter ended September 2008 compared with Rs 185.86 crore in the previous corresponding quarter. The company's net sales during the quarter stood at Rs 1396.21 crore against Rs 1167.62 crore, up 19.58 per cent.

Flat realisation in cement prices and rise in input costs, which went up by 37 per cent, resulted in its net profit plunging after ten quarters. The cost of power and fuels increased to Rs 394.52 crore, up 53.27 per cent.

The earning per share for the quarter stood at Rs 13.19 against Rs 14.93 last year.

In a statement, the company said, "New coal linkages have not yet become operational and there was a shortfall on coal supplies during the quarter against existing linkages." The company said that it increased coal purchase from the domestic market at a higher prices. This has put pressure on the operating margins, which dipped in the quarter to 22.91 against 30.28 last year.

The company is adding 4.5 million tonne of capacity at its plant in Andhra Pradesh to take its overall production capacity to 23.1 million tonne by the end of this year.

In its outlook, the company pointed out the slowdown in real estate and infrastructure sector amid liquidity crunch. "This has resulted into slackening of demand for cement which is now expected to grow by 7-8 per cent against earlier forecasts of 9-10 per cent," the company said in a statement.