Leading cement maker Ambuja Cements’ net profit has dipped by 42 per cent to Rs 326 crore in the first quarter of FY 2008 compared to Rs 566.25 crore in the year-ago period owing to higher operating costs and indirect tax burden.
"The company is facing an unprecedented increase in major operating costs, in particular for coal, power, raw materials and logistics, and a higher indirect tax burden due to a slew of fiscal impositions by state and central governments," the company’s Managing Director A L Kapur told reporters here.
He said factors like hike in excise duty have hit hard but cost increase has not been passed on to consumers.
"Competitive market conditions did not allow the company to pass on the incidence of cost increases through higher prices, thereby impacting margins and lowering profit compared to same quarter last year," Kapur said.
Refuting cartelisation charges by government inflation which has zoomed to over seven per cent, Kapur said his company is willing to hold prices.
Kapur said domestic dispatches rose 16 per cent in the quarter under review reflecting its efforts to maximise production despite constraints.
Exports at 0.2Mt is just half of shipment it made in the year-ago period as volumes were diverted to increase availability in the domestic market.