UltraTech Cement | CMP: Rs 6,860 | The stock tumbled over 4 percent after the company reported a consolidated net profit of Rs 1,062.58 crore for the December quarter, down 37.86 percent from the year-ago period. UltraTech Cement’s revenue from operations, however, rose 19.53 percent to Rs 15,520.93 crore from Rs 12,984.93 crore in the corresponding quarter of the last year, the Aditya Birla Group company said on January 21. While the profit missed estimates, revenue was higher than expected. According to a brokerage poll conducted by Moneycontrol, net profit was seen at Rs 1,105.2 crore and consolidated revenue at Rs 15,191.5 crore.
Capacity utilization at India's largest cement maker, UltraTech Cement , could touch 95 percent to 100 percent in the March quarter, company executives indicated in an earnings call with analysts.
Despite flat cement prices, management said companies in the cement industry are focused on retaining market share.
In the past few years, UltraTech's capacity utilization in the January-to-March quarter has typically been 95 percent to 100 percent, said Atul Daga, Executive Director and Chief Financial Officer (CFO), in his opening remarks in an earnings call for the December 2022 quarter.
"And the way things are going, this quarter should be no less," Daga added.
A quick glance at past records shows that if the company breaches the 95 percent utilization mark in the March-22 ended quarter, it would be the first time since the second quarter of FY18. In the March-2021 ended quarter, the company reported a consolidated capacity utilization of 92 percent, the highest since the second quarter of FY18.
Quarterly capacity utilization rates for the period prior to quarter two of FY18 were not readily available.
For the quarter ended December 2022, UltraTech reported capacity utilization of 83 percent and double-digit volume growth of 13 percent, aided by growth in infrastructure and urban housing demand, the company said.
UltraTech's sectoral update on region-wise demand also shows volume growth across regions – north, central, east and west, with housing and infrastructure contributing to demand across regions, except central India.
The company, in its investor presentation, cited delays in commencement of infrastructure projects in the central region.
Price hikes elusive
Despite growth in demand, cement prices have remained flat, which the management attributed to several players focusing on retaining market share.
"Beyond a point, I think everybody wants price improvement, price increases. Given the cost curve, at the same time, nobody would want to lose their market share. And typically, in a very high-growth time frame, focus will always be on meeting demand," Daga told analysts on the earnings call on January 23.
Emkay Research analysts, in a note on the company the same day, wrote: "The company mentioned that it is disinclined to losing market share in a growing demand environment."
Last year, India's cement sector witnessed ownership of two major cement manufacturers- ACC and Ambuja Cements — change hands. With Adani Cement entering the market through the ACC-Ambuja acquisitions, industry analysts expected a price war to ensue. Cement price trends, so far, have proven otherwise.
- Global Chip Shortage: Taiwan Says It Sees 'Balance' in Auto Chip Supplies by Fourth Quarter
- Taiwan Says Sees 'Balance' In Auto Chip Supplies By Fourth Quarter
- Taiwan says sees 'balance' in auto chip supplies by fourth quarter
- Vodafone Idea Giving Rs. 30 Amazon Pay Voucher With Recharges Valued at Rs. 95 and Above
- Lenovo Rides Work-From-Home Demand to Beat Q1 Profit Expectations
- Gov. Abbott Moves 'To Open Texas At 100%,' End Mask Mandate
- Cathay Pacific sees passenger capacity rising in Q4
- FTSE 100 surges past 7,000 for first time in a year as value increased by £532billion
- Read full text of Kumar Mangalam Birla's address to shareholders at UltraTech Cement AGM
- Update: Hospital Capacity In Hollywood Area
- Update: Hospital Capacity In Pacific Palisades Area
- Update: Hospital Capacity In Encino-Tarzana Area
- Hospital Capacity In Sherman Oaks Area: Update
- Hospital Capacity In Palos Verdes Area: Update
- How Close Are Hermosa Beach Area Hospitals To Capacity? Update
- Update: Hospital Capacity In Park Ridge Area
- Update: Check Hospital Capacity In Lemont Area
- Update: Check Hospital Capacity In Tinley Park Area
- Update: Hospital Capacity In Oak Forest Area
- How Close Are Aventura Area Hospitals To Capacity? Update
UltraTech expects 95-100 percent capacity utilization in fourth quarter have 687 words, post on www.moneycontrol.com at January 27, 2023. This is cached page on Business News. If you want remove this page, please contact us.