The cement major's consolidated net profit tumbled 42.47% to Rs 756 crore on 15.78% increase in net sales to Rs 13,596 crore in Q2 September 2022 over Q2 September 2021.
On a consolidated basis, profit before tax (PBT) stood at Rs 1,103 crore in Q2 September 2022, down 43.35% year-on-year (YoY). EBITDA fell 29.49% YoY to Rs 2,013 crore in Q2 FY23.Total expense climbed 26.69% YoY to Rs 12,934.27 crore in Q2 FY23. Cost of raw material consumed stood at Rs 2,004.28 crore (up 15.76% YoY) and power & fuel expense stood at Rs 4,296 crore (up 70.48% YoY). Energy cost increased 58% and raw material cost rose 18% YoY.
UltraTech achieved capacity utilisation of 76% as against 71% during Q2FY22. Domestic sales volume grew 9.6% on year-on-year basis, despite heavy monsoons through the quarter.
The second quarter is traditionally a weak one for the cement sector, with lower demand as construction activity slows down on account of the monsoons. Demand was low during July and August 2022, showing some sign of revival in September, 2022. Pick-up in retail demand was on the back of pent-up demand accumulation during the monsoons, pre-Diwali construction and repair work gaining momentum, and pre-election tailwinds. Institutional demand was led by increased construction activity after the receding monsoons.
The company's first phase of growth launched in December 2020 is on track and estimated to be completed by the end of FY23. Work on the second phase of growth of 22.6 mtpa announced during the first quarter has already commenced. Commercial production from these new capacities is expected to go on stream in a phased manner, by FY25. Upon completion of the latest round of expansion, the company's capacity will grow to 159.25 mtpa, reinforcing its position as the third largest cement company in the world, outside of China.
In its outlook, the company said that given the government's focus on infrastructure spending and affordable housing, the cement sector's long-term growth potential continues to remain healthy. Demand revival is imminent, especially during the festive season and the January-March peak construction period.
UltraTech Cement is the third largest cement producer in the world, outside of China, with a consolidated Grey Cement capacity of 121.25 MTPA.
Shares of Ultratech Cement were up 0.32% at Rs 6361.70 on the BSE.
Powered by Capital Market - Live News
Disclaimer: No Business Standard Journalist was involved in creation of this content
