India's UltraTech Q2 net almost doubles, warns on costs

Sat Oct 20, 2012 2:02pm IST

Stocks

   

* Q2 net profit up 97 pct on low base

* Variable costs up 8 pct in qtr, freight costs weigh

MUMBAI Oct 20 (Reuters) - UltraTech Cement, India's biggest cement producer, reported a near doubling of profit in the quarter to the end of September from a low base but warned of higher costs for materials, fuel and freight.

Demand for cement in India, the world's second-largest producer after China, is expected to rise about 8 percent during the fiscal year that ends in March, driven by a government push to expedite infrastructure projects to revive growth.

Sales growth across the sector has been slow this year as a result of sluggish homebuilding and construction in Asia's third-largest economy.

Margins of cement makers have come under pressure in recent months due to an increase in the cost of fuel and transport. Ultratech's variable costs rose 8 percent in the quarter from a year previously, the company said on Saturday.

In September, the government hiked diesel prices by 14 percent and that will have a further impact on cement producers.

Major rivals Ambuja Cements and ACC Ltd warned this week that rising fuel and freight costs could nullify increased demand over the coming months.

UltraTech is among a group of cement makers fined a total of $1.1 billion in June for price fixing.

The company, part of the diversified Aditya Birla Group, said its additional capacity of 10.2 million tonnes per year at plants in Chhattisgarh and Karnataka would be operational in the early part of the fiscal year that begins in April 2013.

UltraTech reported a 97 percent rise in standalone profit to 5.5 billion rupees for the July-September quarter, falling short of market estimates of 5.89 billion rupees, according to Thomson Reuters I/B/E/S.

Net sales rose 20 percent to 47 billion rupees. (Reporting by Henry Foy; Editing by Paul Tait)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Election 2014

Election 2014

Kashmiris wary as Modi challenges for power.  Full Article 

Facebook's Performance

Facebook's Performance

Facebook Q1 revenue grows 72 percent on rising mobile ads.  Full Article 

Earnings Season

Earnings Season

Bharti Infratel Q4 net profit jumps 64 percent.  Full Article 

Monsoon Forecast

Monsoon Forecast

South Asia monsoon seen below-average to average in 2014 - WMO.  Full Article 

Solar Dispute

Solar Dispute

Green groups urge U.S. to drop solar trade case against India.  Full Article 

Oil Imports

Oil Imports

India to make May-July oil payments to Iran - sources.  Full Article 

Rice Exports

Rice Exports

India may cede top rice exporter spot under Southeast Asian price onslaught.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage