ACC leads cement stocks' decline

DALAL STREET SPIKES

Associated Cement Companies (ACC) fell 5.2 per cent to Rs 442 after the company announced lower than expected second quarter numbers.

A total of 17.61 lakh shares were traded on the BSE. Other cement stocks were also down: Gujarat Ambuja Cements plunged 6.4 per cent to Rs 67.70, Ultra-Tech Cement lost 4 per cent to Rs 419.25, India Cements shed 5.5 per cent to Rs 94.45, Birla Corporation lost 4.3 per cent to Rs 223. Grasim remained somewhat firm with a loss of only 1.5 per cent.

During the second quarter, ACC's sales rose 13.5 per cent to Rs 1,004.95 crore from Rs 885.28 crore in Q2 September 2004 but operating profit declined 6.5 per cent to Rs 140.05 crore. Analysts said higher cement prices were not enough to combat the rising costs and that squeezed margins.

However, the company's net profit jumped 159 per cent to Rs 203.43 crore boosted by a huge extraordinary profit of Rs 172.80 crore from the sale of the refractory business.