UltraTech Cement posts strong Q2FY24 Financial Results with 16% sales growth

UltraTech Cement Limited, a company within the Aditya Birla Group, has reported it's financial results for the quarter ending September 30, 2023, showcasing a 16% growth in sales volume on a year-on-year basis.

 

Financial Highlights:

  • Consolidated Net Sales: Rs. 15,735 crores, up from Rs. 13,596 crores during the same period last year.
  • Profit Before Interest, Depreciation, and Tax (PBIDT): Rs. 2,718 crores, compared to Rs. 2,013 crores in the previous year.
  • Profit After Tax (PAT): Rs. 1,281 crores, an increase from Rs. 756 crores in the corresponding period.

 

The strong performance reflects continued growth in cement demand during Q2FY24, driven by various sectors, including government-led infrastructure projects, rural development initiatives, and urban residential demand.

 

Operational Insights:

  • Capacity Utilization: UltraTech achieved a 75% utilization rate during the quarter on its expanded capacity.
  • Energy Costs: Energy costs saw a 10% year-on-year decrease.
  • Raw Material Costs: Raw material costs increased by 4%, primarily due to higher expenses for flyash and slag.

 

Capital Expenditure:

UltraTech's expansion program is on track, with 5.5 million tons per annum (mtpa) of capacity already commissioned in the current financial year. The company added 12.4 mtpa during FY23. Additionally, 30 MW of Waste Heat Recovery Systems (WHRS) capacity was commissioned in the quarter. Approximately 22% of the company's total power needs are now met through green power sources, comprising 262 MW of WHRS and 429 MW of renewable energy.

 

UltraTech's total grey cement manufacturing capacity in India now stands at 132.45 mtpa. The second phase of expansion, targeting an additional 22.6 mtpa capacity, is progressing well. As part of this project, 1.8 mtpa of slag grinding capacity will be added, bringing the total capacity of phase 2 to 24.4 mtpa. Commercial production from these new capacities is expected to commence in phases by FY25/FY26.

 

Future Outlook:

UltraTech Cement anticipates a revival in demand, particularly during the festive season and the peak construction period from January to March. The expectation is based on pre-election spending, continued government support for infrastructure development, and ongoing real estate projects, all of which bode well for the company's prospects.

 

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