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Cement Giant Ultratech published its results for Q1 of FY23 wherein the company reported a 7% decline in profits.
The profit for the quarter ending in June 2022 was Rs 1,582 crores. Although it was 6.9% lower than last year's Rs 1,700 crores, the company still managed to beat the estimated figure of Rs 1,300 crores.
The company's expenses surged 36% from Rs 9,508 crores in the corresponding quarter last year to Rs 12,980 crores this year. However, the company reported a 28% growth in revenues, coming in at Rs 15,164 crores this quarter.
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The company was also able to utilize 83% of its production capabilities as opposed to 73% last year as the company's domestic sales volume improved 19% YoY in the quarter. The company said that cement demand was on the lower side during May on account of inflationary pressures and lower labor availability but the same picked up in June for pre-monsoon construction.
"Work on further CAPEX announced during the quarter has already commenced and 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," the company said in a statement.
While commenting about business conditions in the near future, the company said that cost pressures could hurt the company's profitability. However, improved momentum in housing and the government's thrust on infrastructure and industrial development would lead to an upswing in cement demand.
The share moved very well on Friday as it surged 5.4% in a single day to close at Rs 6,458.70 per share, a price level the share hadn't climbed back to since early May. On Monday, the share opened at Rs 6349.00 per share.
Article by Aman Agarwal.
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