India Cements doubles 1Q net profit

India Cements Ltd (ICL) reported that net profit for the 1QFY2023 more than doubled to INR760m (US$9.54m) over the year-earlier period.

Revenue from operations rose by 41 per cent to INR14,460m and total expenditure increased by 57 per cent to INR152,60m, the company said in a filing. Total comprehensive income more than doubled to INR800m. 

During the quarter, clinker production was up by 28 per cent while cement sales rose by 38 per cent to 2,553,000t. Clinker sales were marginally higher at 119,000t (1QFY22: 94,000t).

N Srinivasan, vice chairman and MD of the company, said the increase in power and fuel costs alone was more than 54 per cent in the quarter, while the overall increase in variable costs was about 40 per cent with marginal savings in other items of raw materials and stores. “Since power and fuel are the main causes, we could not do anything against the onslaught. It is an extraordinary situation,” he said.

Mr Srinivasan added that coal can be imported either from Australia, Indonesia or South Africa, depending on prices. ICL had recently imported two shipments of coal from Russia and it had stocks lasting for two months.

On the outlook, Mr Srinivasan said that he did not immediately foresee any sharp drop in fuel prices. The exact scenario will be known in the coming weeks. 

He added that the company would set aside INR600m-700m as capex for the completion of its Sankar Nagar cement plant modernisation and waste heat recovery system.

Meanwhile, R Parthasarthy, chief marketing officer, said that ICL had sold more than 10,000t of CSK cements in three months since its introduction in March.