More good news for the Indian cement sector as Gujarat Ambuja posted a more-than-double growth in its profitability for the quarter ended June 30. Riding on the back of higher prices, India’s fourth-largest cement company’s net profit surged 109.3 per cent to Rs 303.9 crore, while revenue grew 57 per cent to Rs 1134.2 crore.
Gujarat Ambuja’s operating profit also grew sharply to Rs 451.9 crore, as compared with Rs 230.9 crore last year. Better financial management reduced its interest costs to Rs 12.3 crore from Rs 22.6 crore last year. Gujarat Ambuja’s financial year ends on June 30. Shares of Gujarat Ambuja climbed 3.9 per cent to Rs 103.5 on the Bombay Stock Exchange, while the sensex surged 3.4 per cent.
The company attributed "improvement in productivity and efficiencies in operations coupled with better selling prices in domestic as well as export markets" for the rise in its quarterly net profit. Analysts said better management of Gujarat Ambuja’s freight operations also added to its profitability in the June quarter.
In January 2006, Holderind Investments, Mauritius (Holcim) acquired 14.8 per cent of the shareholding of the company from the promoters. Holcim then acquired management control after the closure of the open offer made to the shareholders of Gujarat Ambuja.