India Cements posts Q4 standalone net loss of Rs 217.79 cr – ET Infra

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CHENNAI

: Cement manufacturer The India Cements Ltd has reported a standalone net loss at Rs 217.79 crore for the fourth quarter ending March 31, 2023, which the company attributed to the record increase in the cost of fuel and power. The city-based company had registered a standalone net loss of Rs 23.71 crore during the corresponding quarter of the previous year, the company said on Wednesday.

For the year ending March 31, 2023, the standalone net loss stood at Rs 188.55 crore as against net profit of 38.88 crore.

“The results for the fourth quarter are generally not comparable as it includes all the provisions for write-offs and impairment of investments,” the company said.

In the first quarter of the year, India Cements had registered a standalone net profit of Rs 76.09 crore as of June 30, 2022, whereas for Q2, it faced a net loss of Rs 137.58 crore on September 30, 2022, and bounced back again as of December 31, 2022 in Q3 with a net profit Rs 90.73 crore, with the Q4 again seeing a net loss of of 217.79, adding up to a net loss of Rs 188.55 crore for the year ending March 31, 2023.

“The third quarter was profitable because we made Rs 294 crore asset sales during that quarter, and therefore the net loss for the year came down due to those profits,” a company official said.

As for standalone total income during the quarter under review, it grew to Rs 1,478.89 crore from Rs 1,396.72 crore recorded in the same period last year.

For the year ending March 31, 2023, the standalone total income went up to Rs 5,415.08 crore compared to Rs 4,729.83 crore registered a year ago.

Declaring the financial performance for the quarter and the year ending March 31, 2023, company Vice-Chairman and Managing Director N Srinivasan said the performance of the company during the year under review was adversely impacted due to a record increase in the cost of fuel and power, which could not be compensated in the market due to supply overhang.

“This was compounded by one-off charges on account of impairment of certain investments and advances. This was to some extent compensated by the profit on the sale of investments. All these factors led to the dismal performance for the quarter and year ended March 31, 2023,” he said.

The impact on the production cost was due to the steep increase in coal price, diesel, pet coke, and power which was much higher for the company compared to many of its peers, Srinivasan told reporters.

He said that with lower production of blended cement on account of market mix and lower capacity utilisation of manufacturing plants at 63 per cent for the year, the margins were squeezed with the uncompensated cost increase.

During the year under review, he said the cost per kilo calorie of fuel increased from around Rs 1.85 in the previous year to Rs 2.90 in the current year and the average rate of power went up from Rs 5.20 per KWH to Rs 7.04 per KWH, an increase of 35 per cent.

“These two major factors together with a reduction in blended cement proportion increased the cost of production by more than Rs 840 per tonne while net plant realisation improved hardly by Rs 200 per tonne resulting in substantial erosion of margins,” he said.

The company took steps to improve the liquidity through the sale of investments in Madhya Pradesh, which helped in the short term to improve the capacity utilisation to around 72 per cent in the fourth quarter of the last financial year as against 60 per cent registered in the previous year, he said.

  • Published On May 24, 2023 at 05:04 PM IST

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