India Cements narrows down Q2 loss to Rs 85.54 crore, revenue dips 4.7% to Rs 1,264.39 crore

India Cements Q2 Results: India Cements Ltd on Wednesday reported a narrowing down of its consolidated net loss to Rs 85.54 crore in the second quarter ended on September 2023 mainly due to a reduction in selling price and loss of volume. The company had posted a net loss of Rs 121.10 crore during the July-September quarter a year ago, according to an exchange filing from India Cements Ltd (ICL).

Its revenue from operations was down 4.72 per cent to Rs 1,264.39 crore during the period under review as against Rs 1,327.06 crore in the corresponding quarter of the previous fiscal.

"The performance of the company was better than that of earlier quarters turning out a marginally positive EBIDTA despite the restricted operations caused by the stressed working capital position," ICL said.

ICL's EBITDA for the quarter was at Rs 14 crore, "sizably improved" compared with the negative EBIDTA of Rs 87 crore during the second quarter of the previous year, it added.

India Cements's total expenses in the September quarter of FY24 were down 10 per cent to Rs 1,375.36 crore.

Its overall volume for the quarter under review was 23.70 lakh tonnes as compared to 22.54 lakh tonnes in the previous year.

"The selling price of cement continued to be under pressure due to supply overhang and competition in the marketplace. However, there was a substantial reduction in variable cost on account of lower fuel prices," it said.

However, the varying vintage of the plants contributed to lower reduction as compared to peers and with the lower realization for cement in the market, the operating margins continued to be under pressure.

"The lower margins impacted the liquidity severely accounting for the lower volume as compared to peers," it said.

The total income of India Cements in the September quarter was at Rs 1,272.41 crore, down 4.88 per cent.

The Chennai-based company is continuing its efforts towards the disposal of non-core assets and other means to raise funds for the refurbishment of the plants to improve efficiency and also augment working capital needs.

Over the outlook, ICL said its cement demand looks positive with increasing home building and construction activity and the government's push on infra projects.

However, it said, "margins are expected to come under pressure with increasing operational costs, intense competition in the marketplace and logistics and supply chain constraints and the depreciation of rupee against the dollar." 

Shares of The India Cements Ltd on Wednesday settled 4.56 per cent lower at Rs 199.85 apiece on the BSE.