Emami expects to break even in FY16-17

Emami expects to break even in FY16-17
01 September 2017

India-based Emami Cement expects to break even by the end of FY17-18 and bank a profit by the next financial year.

The company’s bottom line will be driven primarily by value and volume of sales, according to Vivek Chawla, wholetime director and CEO. Emami’s top line is forecast to expand to INR14bn-15bn (US$218.9m-234.5m) by the end of the current fiscal if sales of 3.2Mt are achieved. This sales volume represents 80 per cent of its 4Mta total installed capacity.

“Usually cement companies take longer to break even. Despite being a new entrant into the segment we are positive of making profits by next fiscal. Our debt position is also fairly comfortable,” Mr Chawla told India-based BusinessLine.

The company runs two cement plants - a 2Mta integrated unit at Risda in Chhattisgarh and a 2Mta grinding unit at Panagarh in West Bengal. Commercial production at the Risda works started in December 2016, followed by the start-up at Panagarh in February 2017. Revenues during the December 2016-March 2017 period reached INR2bn. In the current financial year to August, sales reached INR4.1bn.

In addition to the INR34bn investment into the Chhattisgarh and Panagarh plants, the cement producer is investing INR6bn in a 2Mta grinding unit at Jajpur in Odisha, which is expected to be commissioned at the end of FY18-19. Emami has also acquired on lease a 300Mt limestone mine in Rajasthan and a 220Mt limestone mine in Andhra Pradesh.

Published under Cement News