Cement companies are set to reap significant benefit from January's mini Budget. Industry leaders said the government¹s decision to snip the customs duty on coal by 10 per cent, from 25 per cent to 15 per cent, would have a positive impact on the bottom lines of cement companies. Anil Singhvi, executive director, Gujarat Ambuja Cements said, ³The comnbined impact of the reduction of import duty on coal from 25 per cent to 15 per cent and the abolition of the 4 per cent special additional duty (SAD) will help companies to further cut their cost of production and be more competitive.² Gujarat Ambuja imports around 500,000t of coal every year. The current landed price of coal is around $60 per tonne. D D Rathi, chief financial officer, Grasim Industries, said since the imports of coal would become cheaper, domestic prices of coal were likely to soften. ³This will definitely have a positive impact on the margins of cement companies,² he pointed out. Y M Deosthalee, chief financial officer, Larsen & Toubro said, ³The cut in customs duty on coal will benefit the cement industry. However, this may be offset by international coal and freight rates increasing.² Analysts said the rising rupee had already reduced the import bill of cement companies significantly in rupee terms. Published under Cement News
Cement companies are set to reap significant benefit from January's mini Budget. Industry leaders said the government¹s decision to snip the customs duty on coal by 10 per cent, from 25 per cent to 15 per cent, would have a positive impact on the bottom lines of cement companies. Anil Singhvi, executive director, Gujarat Ambuja Cements said, ³The comnbined impact of the reduction of import duty on coal from 25 per cent to 15 per cent and the abolition of the 4 per cent special additional duty (SAD) will help companies to further cut their cost of production and be more competitive.² Gujarat Ambuja imports around 500,000t of coal every year. The current landed price of coal is around $60 per tonne. D D Rathi, chief financial officer, Grasim Industries, said since the imports of coal would become cheaper, domestic prices of coal were likely to soften. ³This will definitely have a positive impact on the margins of cement companies,² he pointed out. Y M Deosthalee, chief financial officer, Larsen & Toubro said, ³The cut in customs duty on coal will benefit the cement industry. However, this may be offset by international coal and freight rates increasing.² Analysts said the rising rupee had already reduced the import bill of cement companies significantly in rupee terms. Published under Cement News
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